Topic: Ripple vs Bitcoin = Subversion vs Git (Read 2213 times)

I agree, I'm skeptical of the current implementation by NewCoin, and I am concerned with the level of adoption and implementation necessary for a completely trustworthy Ripple network. That said, the concept of IOUs are fine. I make and receive IOUs regularly, and they are handled mostly on time with gratuity. If Ripple handled that for me all electronically, that'd be flippin' awesome! Maybe it'd need to be done in circles like G+ has "friend circles". As a matter of fact, Google will more than likely add that ability sooner or later.

What bothers me right now is that, like you said, it is highly centralized, requires major exchanges (same as bitcoin) and basically if the IOU system were used at this moment, I'm pretty sure everyone and their mom would be scammed to hell and back. Some random dude on these forums PMed me the other day with "hey! add me on Ripple buddy!". That shit is going to be more devastating than bitcoin wallets deleted because it will affect relationships and reputation. It's not an easy problem to fix though because like Bitcoin, people just aren't used to being responsible with their money, much less PGP signing, encryption, and the idea of "no chargebacks when you give your money to a scammer". That's gotta change first, and where Bitcoin tries to solve that problem (and fails, because bitcoin can't fix the social engineering side of a scam, e.g. fake ASIC websites that accept BTC, etc), Ripple would simply organize debt to make it much easier to settle it.

Ask JoelKatz how long it's going to be before Ripple is going to be a system for tracking those kinds of things.

The Ripple that's being created now is an enhanced and polished version of the same paradigm that we're trying to replace, that might someday evolve into a system for tracking P2P credit. The merchants that sign up to this are going to trust gateways, not individual users. You'll hand your money (BTC or legacy currency) over to a gate keeper, which will then give you permission to use your own funds.

Granted it's going to be a much more pleasant experience than the current state of the art for moving fiat currency around, assuming legal and regulatory barriers do not emerge which completely cripple the functionality gateways are allowed to provide.

With Ripple, no one would need to have a bank anymore, ever. No need for bitcoin wallets either. I don't think of it as a question of not protecting someone's belongings or investments, but of opening more diverse opportunities to collect on them.

I'd rather know my brother was giving me either a cup of sugar or something of equal value and that I could trust him to do so when he is able (or when I need it most), than to trust an insanely volatile speculative internet commodity to retain any value whatsoever. No, I'm not against Bitcoin, I love it! I'm against Bitcoin as a currency though. It will make even less sense the more bloated the blockchain and higher the fees.

That is an incredible statement.  It is why the banksters will protect their investment.  It would facilitate a true free trade without them making profits and they are only built on the massive profits that are given to them.  You say the average person is not a cruel banker, but when we all realize what is happening, people protect their hard work.

When your brother borrows a cup of sugar and doesn't give it back on time, do you have him arrested? Society doesn't work like this, and it has nothing to do with everyone being "smooth talkers". As for the argument of bitcoin having "absolute value" because it's "mathematically backed", etc, the "value" of bitcoins fluctuates insanely at the whim of centralized exchanges and manipulators.

Back on topic, if your brother borrows a cup of sugar and you want a soda pop instead of the sugar, can't your brother give you that instead and just agree it has the same value? Why make your brother go to the store when you don't even need the sugar in the first place? That's not "mathematically exact", but if you both agree it to be of the same value, isn't that a more sociable solution?

The average person is not a cruel banker, and some of us enjoy finding solutions in an effort to foster the growth of opportunities. Some of us are extremely generous in repaying debts out of thankfulness to those who extended it (an absolute mathematical system would deny any generosity). The reason we hate banks right now is because they're cold, cruel, and talk smooth. I agree. Is it really necessary to hate your brother for not having sugar, when a network can be created (Ripple) that would allow you to get sugar from your neighbor because your neighbor owed your brother something of equal value too?

I guess I too can see how the mathematical finality of Bitcoin would appeal to people who are accustomed to living alone, hiding from social situations and making sure their action figure collection is still not opened. For the rest of us? Ripple seems to be a more natural system of payments and an ingenious way to organize IOUs in a very unpredictable world, one run by humans who accidentally delete their bitcoin wallets all the time.

I agree. If Ripple can be made decentralized like Bitcoin, without any thought of ridiculous hyped up XRP or BTC "prices", then it would be a fair system for everyone and any debt could be paid by anyone, anywhere by any negotiable means necessary. That is the future I believe, not demanding someone use your protocol. We already have banks for that.

First of all, Ripple could like I said, it could send not a ripple but a tidal wave of disruption to the current system.  Also if something is that revolutionary it will take hold quicker than you think.  Micromanagement of your money in my opinion is something to be considered, along with public investments in the next transparent company that you believe in instead of deposits in the bank.  The internet is past due for the macro management of peoples own money.

That's true. With Bitcoin there are no "take backs".  Once you commit to something by broadcasting a transaction on the network there's no way to say later, "I was just kidding. Can't we all just get along?".  I can see how the mathematical finality of Bitcoin would appear to be cruel and unforgiving for people who are accustomed relying on their ability to talk their way out of problems as an alternative to following through with commitments.

Ripple deals with money as a human concept, the way it should be. Bitcoin deals with money as a mathematical *exact* concept the way bankers think. If you're a math nerd, you'll love Bitcoin. If you're a normal human being who wants to use something on a regular basis, you'll love Ripple. They are different concepts, but not mutually exclusive.

I really hate that Ripple will take so long to get going (there is a huge awkward factor to it because friends and colleagues don't *usually* keep tabs on their microloans to each other so much as it creates social issues), but once it does get going, I don't think there will be a place for Bitcoin any longer to be honest. Bitcoin is slow, bulky and acts more like a stock or commodity. Ripple seems to work to solve everyday issues, not get early adopters rich; that fact alone makes many bitcoiners hate it. "How am I supposed to get 3000% profts from Ripple?"  


Disclaimer: I have no comment on the current implementation of Ripple by OpenCoin, still watching and learning. Anything that allows Open Transactions to be done by laymen should be looked into in my book.

I thought a decentralized exchange was the answer without thinking about who would hold the fiat.  How does ripple solve the problem of a decentralized exchange, while facilitating the problem of having to "send" fiat to a central broker.  On the other hand most of our money is digital right now anyway, but I have the mental block of where the fiat be stored.  On the third hand, we do not need the fiat...

I'm looking forward to this.

People who believe that fiat currencies are awful and shouldn't be used might see Ripple as a bridge between the existing financial system and a future financial system based exclusively on crypto-currencies.

In the meantime, Ripple will help Bitcoin by making it easier to buy and sell Bitcoins and reducing some of the currency risk by allowing currency exchange to be built into payments denominated in Bitcoins. Every merchant who accepts Ripple payments will be another merchant you can pay with Bitcoins. (We're working on making this more seamless.)

The existing financial system is broken in many ways. But it works well enough for practical purposes. We're hoping that Ripple will work a little better for a significant class of transactions that can't yet be replaced by Bitcoin.

i'll just give an example of why I think ripple will help bitcoin. Maybe I misunderstand things.. but here goes

Say you have a bitcoin ATM. How would it work? when someone deposits money in it you can't magically send that money to an exchange. What you could do is what bit instant does. Bit instant uses THEIR funds and buys the bitcoin with THEIR money and you get the bitcoins and eventually some time later... they get your funds. This limits liquidity.

Now in comes ripple

you insert dollars into an ATM. You can then purchase bitcoins right then and there directly off an exchange because the ATM itself has a trust relationship with the exchange and is therefore a satellite of sorts for deposits.

I don't see the big need for ripple. It has very few advantages to BTC, and many disadvantages, including completely pre-mined coins held by the founder. Also, is the source code open yet?

I don't see why ripple needs Bitcoin. It might simply draw in digital currency users by accepting it. Doesn't necessarily promise an advantage to btc.

I think bitcoin could get incredibly popular... but I don't think it could take over the world alone. I think it needs ripple and ripple needs bitcoin.

The problem lies in that good intentions are ruined by human greed.  Everyone has their sell point.  Ripple is possibly a step in the right direction and could really cause not a ripple, but a tidal wave to hit the current system.

"When I say I hate CVS with a passion, I have to also say that if there any SVN users in the audience, you might want to leave. Because my hatred of CVS has meant that I see Subversion as being the most pointless project ever started, because the whole slogan for the Subversion for a while was “CVS done right” or something like that. And if you start with that kind of slogan, there is nowhere you can go. It’s like, there is no way to do CVS right."

--Linus Torvalds

Ripple and Bitcoin both attempt to solve the problem of digital currency but approach it from opposite ideological perspectives. Ripple recognizes that the existing financial system works as a series of IOUs and attempts to improve the manner in which they are transacted. Bitcoin attempts to make IOUs unnecessary by making the transfer of actual currency as easy as the transfer of IOUs. In the same way, Subversion attempts to make centralized version control better while Git proposed that centralized version control is broken by definition and instead implemented decentralized version control. I propose that Ripple can be at best the implementation of a broken paradigm that sucks less than everything else.

The central question is, "Under what circumstances, if any, should we trust a third party to hold on to our money for us?" If you assume that allowing third parties (gateways in the Ripple system, banks in the legacy financial sector) to hold money for users is a good idea then Ripple looks pretty good in terms of usability. Just because the legacy financial system works this way, however, does not mean it's true.

The benefits of entrusting the storage of money to third parties are dubious even under the best of circumstances. Even before modern times when money was held as gold or paper notes, storing money in a bank was a tradeoff between different risks of theft. On the one hand the bank has a stronger safe and so could resist physical theft better than most individuals, but on the other hand any thief with sufficient resources to overcome the bank's defenses could get away with a lot of money. Oh, and there's also the small matter that if everybody gives their money to the bank it's really easy for the bank to steal it.

In the modern era both of these risks are amplified. Financial institutions have a terrible track record when it comes to not losing or stealing their clients' money. This is even more true when it comes to companies who operate in the Bitcoin economy using business models based on legacy financial principles. The reason we need trustless financial systems is because trust just doesn't work. As companies which store client funds are more successful, they gain more trust. As they gain more trust people give them more money to store. As the amount of money they store increases, so does the bullseye painted on them.

Larger piles of money are more attractive to thieves. Even if we assume the operators of theses services have the best of intentions and perfect integrity that's not enough to say it's a good idea to trust them to store money.  At some point these operators will need to hire employees. That creates the risk of an inside job that only grows as the company becomes more successful. At the same time, thieves who don't want to go to the trouble of getting a job there will attempt remote attacks. This is a huge problem because fundamentally we're losing the battle when it comes to computer security. The capabilities of the attackers scales exponentially while the abilities of defenders to resist attack is scaling linearly. The same feedback loop that causes the most trustworthy companies to attract the most customer money means the most trustworthy companies will be the most attractive to attack.

The only viable way to defend against decentralized attackers is decentralized defense. Everybody hold on to their own money instead of aggregating it at centralized points of attack. This reduces the cost/benefit ratio for attackers, thus making theft less profitable. This seriously undermines the utility of any system which relies on trusted entities to hold client funds, and makes the use case for Ripple as it currently is presented highly questionable.

This doesn't mean that I am entirely opposed to it, however. Even though trustless systems are the future we're going to be stuck with the legacy financial for a while, and the existing methods for transferring value in that system suck so badly that Ripple is a huge improvement. In that way it makes a great transitional technology.

In summary: use Ripple as a way to make the times that you're forced to handle legacy currencies far more enjoyable. Don't accept a Bitcoin IOU in lieu of the real thing though. There's no need for it and sooner or later pretending that IOUs are just as good as actually having BTC will always end in tears.