Re: Ripple

Hi all,

I am one of the engineers at Ripple Labs. I've been with the company for 3
months so I can speak to a fair number of these points but for the nitty
gritty details of how consensus works I'll bring our chief cryptographer
David Schwartz into the conversation.

Regarding the order book and exchange rates, the order book is public and
is one of the pieces of information the system uses consensus to determine.
If you want to see all of the outstanding offers for any currency pair you
can do that directly in the client.

When someone wants to make a trade or do a cross currency payment the path
finding engine will search direct and indirect paths for the rate that is
best for the initiator. If you want to see visuals of these paths happening
you can go to ripple.com/graph and click on a transaction entry to see a
visualization of the paths. Transactions can and often do take multiple
paths to get the best rate but all the end user really needs to know about
is the amount it'll cost them in the currencies they have to send some
amount in another currency to someone else. If you take a look at the Send
tab in the client and have a couple of different currencies in your wallet
you can see this functionality in action.

Happy to try to answer any more questions you all have, I think there's a
lot of opportunity for collaboration between Ripple and this group.

Evan
On Nov 17, 2013 3:25 PM, "Joseph Potvin" <jpotvin@opman.ca> wrote:

> Thanks,
>
> RE: it has an order book and the market determines the price
>
> How exactly?  And is the order book and associated process documented
> somewhere? I'd love to see the UML sequence or activity diagram, for
> example, but text will do.
>
> Is the general user experience that of a price-maker or price-taker? A
> currency "price maker" is asked to bid. A currency "price taker" is shown a
> rate as a fait-accompli.  And does the user make or take the intermediate
> XRP rate, or the destination currency rate?  (i.e. If Fred pays CAD to a
> vendor who wants to receive USD, he'd want to make or take the CAD-USD
> rate. The CAD-XRP then the XRP-USD rates would be invisible and of no
> concern to him.)
>
> Joseph
>
>
>
> On Sun, Nov 17, 2013 at 5:26 PM, Melvin Carvalho <melvincarvalho@gmail.com
> > wrote:
>
>>
>>
>>
>> On 17 November 2013 23:24, Joseph Potvin <jpotvin@opman.ca> wrote:
>>
>>> Melvin, Can you point to the specific documentation about how Ripple
>>> determines XRP inter-currency spot exchange rates with all the central bank
>>> currencies,and for BTC? And is there a documented policy for choosing the
>>> official source of exchange rate data for any other present or future alt
>>> crypto currency out there would be added to the Ripple portfolio of
>>> currencies?
>>>
>>
>> AFIAK it doesnt use a spot rate, it has an order book and the market
>> determines the price.
>>
>>
>>>
>>> Tx,
>>>
>>> Joseph Potvin
>>>
>>>
>>>
>>> On Sun, Nov 17, 2013 at 4:32 PM, Melvin Carvalho <
>>> melvincarvalho@gmail.com> wrote:
>>>
>>>>
>>>>
>>>>
>>>> On 17 November 2013 22:27, Fabio Barone <holon.earth@gmail.com> wrote:
>>>>
>>>>> I should do this as a homework, I apologize,
>>>>>  but I'm currently pretty busy.
>>>>>
>>>>> Would someone be so kind and answering these questions about Ripple:
>>>>>  - Is the code open source?
>>>>>
>>>>
>>>> Yes
>>>>
>>>>
>>>>> - Is the protocol they use openly documented,
>>>>>   as openly as bitcoin is?
>>>>>
>>>>
>>>> I can only answer this superficially as I've not written a web ripple
>>>> implementation (yet)
>>>>
>>>> But it seems to be yes: https://ripple.com/wiki/
>>>>
>>>> You only ever know after you've drilled down into every last detail ...
>>>> something I plan to do next year ...
>>>>
>>>>
>>>>>
>>>>> thanks
>>>>>
>>>>>
>>>>> 2013/11/17 Manu Sporny <msporny@digitalbazaar.com>
>>>>>
>>>>>> On 11/14/2013 04:30 PM, Andrew Miller wrote:
>>>>>>
>>>>>>> 2. But this doesn't work for public/anonymous networks.
>>>>>>>
>>>>>>
>>>>>> Why doesn't it work for public/anonymous networks? Link? This is Web
>>>>>> of
>>>>>> Trust stuff we're talking about, isn't it (chained trust metrics)?
>>>>>>
>>>>>>
>>>>>>  3. Ripple, on the other hand, takes yet another approach. There's no
>>>>>>> global administrator, but nor is there a well-understood public
>>>>>>> competition. Instead, individual users are supposed to configure
>>>>>>> their clients to identify particular servers they have determined
>>>>>>> they trust.
>>>>>>>
>>>>>>
>>>>>> Isn't this a good thing? If you allow anyone to pick who they trust,
>>>>>> you
>>>>>> force cooperation in the system, don't you? The idea being that for
>>>>>> the
>>>>>> system to be useful, people need to coordinate and thus won't pick
>>>>>> participants with whom they entirely disagree with.
>>>>>>
>>>>>>
>>>>>>  Here's where it gets really murky, and I can't figure out any set of
>>>>>>> assumptions that actually lead to robust functioning of the network.
>>>>>>> What if users entirely disagree with which servers they trust?
>>>>>>>
>>>>>>
>>>>>> Why would someone deliberately do this? If you have to pick from 32
>>>>>> servers, why would you pick from 32 servers that are in a completely
>>>>>> different trust set? It would be incredibly difficult to do that in a
>>>>>> dependency chain based system, wouldn't it?
>>>>>>
>>>>>>
>>>>>>  Are they on two different networks or the same one?
>>>>>>>
>>>>>>
>>>>>> No idea.
>>>>>>
>>>>>>
>>>>>>  If an individual doesn't do their due diligence, and carelessly
>>>>>>> approves bad servers, are they individually affected or does it
>>>>>>> affect the overall network?
>>>>>>>
>>>>>>
>>>>>> I'd expect that in the worst case, the overall network suffers.
>>>>>> However,
>>>>>> the likelihood of this is in the 51% attack against the Bitcoin
>>>>>> network
>>>>>> category, isn't it?
>>>>>>
>>>>>>
>>>>>>  I really wish more people were looking into this rather than ignoring
>>>>>>> it, because I suspect it's not sound (although I haven't come up with
>>>>>>> a super clear explanation why not), and if the underlying assumptions
>>>>>>> aren't sound then does it matter if the frontend UI is great?
>>>>>>>
>>>>>>
>>>>>> Well, yeah, if the algorithm is broken then no UI in the world is
>>>>>> going
>>>>>> to save it. However, I don't think you've explained quite why Ripple's
>>>>>> consensus algorithm is broken. Why is allowing individuals to pick
>>>>>> whom
>>>>>> they trust a bad thing (when the number of servers is large enough)?
>>>>>>
>>>>>>
>>>>>>  Unfortunately the only set of assumptions I can think of that lead
>>>>>>> to this actually working is where every one essentially picks the
>>>>>>> same default list, and the servers on that list are actually
>>>>>>> trustworthy.
>>>>>>>
>>>>>>
>>>>>> I think the problem surfaces when a group of servers create a trust
>>>>>> set
>>>>>> that has no intersection with another set of servers. With that said,
>>>>>> why would anyone do this? What's the attack?
>>>>>>
>>>>>>
>>>>>>  This is the "centralized" option, where the default list determines
>>>>>>> who participates, and no user has any incentive to deviate from the
>>>>>>> default list, either by adding some newcomer they individually trust
>>>>>>> or by removing default servers they don't trust.
>>>>>>>
>>>>>>
>>>>>> I thought that only a subset of the list needs to be trusted for
>>>>>> Ripple
>>>>>> to function, and all trust sets that all servers choose have to
>>>>>> overlap
>>>>>> by at least a small degree. Is that not true?
>>>>>>
>>>>>>
>>>>>> -- manu
>>>>>>
>>>>>> --
>>>>>> Manu Sporny (skype: msporny, twitter: manusporny, G+: +Manu Sporny)
>>>>>> Founder/CEO - Digital Bazaar, Inc.
>>>>>> blog: Meritora - Web payments commercial launch
>>>>>> http://blog.meritora.com/launch/
>>>>>>
>>>>>>
>>>>>
>>>>>
>>>>
>>>
>>>
>>> <http://goo.gl/Ssp56>
>>>
>>
>>
>
>