Question about basic concept

[Adam Wascholl]

I have a question and I'm not sure I've seen answered yet: does the new Ripplepay operate the same as the old?  That is, do we establish credit limits with other users in the network, so that when we make transactions in real life with individuals, the network finds a pathway of credit?

http://www.screenr.com/c5K

Thanks for all of the work you're putting towards this idea.

[Jeffrey Cliff]

define 'new ripplepay'.  If by that you mean ripple.com...

> do we establish credit limits with other users in the network, so that when we make transactions in real life with individuals, the network finds a pathway of credit

Yes.

Only there's 'easy to connect to' people called 'nexuses' that interact with the legacy banking system, for those of you out there with either no friends or no friends who use ripple.

Jeff

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GENERATION 26: The first time you see this, copy it into your sig on any forum and add 1 to the generation

[Jorge Timón]

I would say the main differences in usage are that the new Ripple
doesn't support interest rates like the classic ripplepay (a bad
design decision IMO) and for cross-currency payments, the exchange
rate is not pulled from an external market. For cross-currency
payments, you need an offer from currency A to currency B in the
system to be able to make the payment (I like this more).

The main advantage, of course, is that it's not on a centralized
server but a p2p network, at the cost of minimal fees in a host cash
(as opposed to credit) currency called ripples (xrp). Privacy is also
somewhat compromised, but you can run various connected nodes to
improve it through obfuscation. Paying through Nexuses can also
improve privacy.

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Jorge Timón

http://freico.in/
http://archive.ripple-project.org/

[Ryan Fugger]

On Thu, Jan 3, 2013 at 11:37 PM, Jorge Timón <jtim...@gmail.com> wrote:
> I would say the main differences in usage are that the new Ripple
> doesn't support interest rates like the classic ripplepay (a bad
> design decision IMO)

I should just add that charging interest isn't precluded by the
design, it's just not implemented as a feature in the client at this
point.

Ryan

[Jorge Timón]

Yes, I've been talking with some developers and it seems they plan to
eventually implement it. It's just not a priority for now.
Sorry, I forgot about this thread.

[Adam Wascholl]

A few ideas/questions:

1)  Is it possible to establish an overall credit limit you're willing to give to your friends, but have the sum of the individual credit limits exceed that overall limit?  A good example is something like a circuit breaker.  Your house limit might be 100 amps, but you could easily have 20 different breakers that are 10 amps each.  Here's how it would work with something like Ripple:

You set an overall limit of 500, and you have three friends with a credit limit of 200 each.  If two of your friends max out their limit with you, you're now saying that the third friend only has a limit of 100.  This would be done because the sum of the credit limits you offer to each of your individual friends might exceed the amount of credit you could realistically provide should they all call on it at the same time.

2) Is it possible to create different credit limits with individuals, based on the reasons they're calling on the credit?  For instance, maybe I would offer a friend of mine a 200 ripple credit limit for general things, but if they're using the credit towards something like local agriculture, I might want to help support that initiative for 400 credits.

3) Could a crowdsourcing feature be built into the network?  It would be nice to see other members in the networks expressing what projects they might want to work on, and now people with skills or resources may be able to provide just as much as those with money. 

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~A

[Kurt Padilla]

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I would love to see such a credit limit feature as well, but you would have to be careful about setting limits this way because it could turn out like a bad tapas dinner, where a few friends miss out and don't get any credit.

Kurt

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[Jorge Timón]

Hi, Adam.

On 1/13/13, Adam Wascholl <adam.w...@gmail.com> wrote:
> A few ideas/questions:
>
> 1) Is it possible to establish an overall credit limit you're willing to
> give to your friends, but have the sum of the individual credit limits
> exceed that overall limit? A good example is something like a circuit
> breaker. Your house limit might be 100 amps, but you could easily have 20
> different breakers that are 10 amps each. Here's how it would work with
> something like Ripple:
>
> You set an overall limit of 500, and you have three friends with a credit
> limit of 200 each. If two of your friends max out their limit with you,
> you're now saying that the third friend only has a limit of 100. This
> would be done because the sum of the credit limits you offer to each of
> your individual friends might exceed the amount of credit you could
> realistically provide should they all call on it at the same time.

You can simulate this with two accounts. Your regular account would be
A, where you trust all your friends. With A you trust B by the overall
negative limit and B trusts A for the overall positive limit. You use
B to pay. Your friends will only owe (or be owed by) A.

> 2) Is it possible to create different credit limits with individuals, based
> on the reasons they're calling on the credit? For instance, maybe I would
> offer a friend of mine a 200 ripple credit limit for general things, but if
> they're using the credit towards something like local agriculture, I might
> want to help support that initiative for 400 credits.

I guess you could make a similar work around using mutliple accounts.
Probably the easiest solution is for your friend to make a different
account for the agriculture project.

> 3) Could a crowdsourcing feature be built into the network? It would be
> nice to see other members in the networks expressing what projects they
> might want to work on, and now people with skills or resources may be able
> to provide just as much as those with money.

I think you mean crowdfunding...
Yes, in fact I think Ripple is great for p2p lending. Ripplepay
supports interest rates. The new Ripple still doesn't and it's not a
priority, but I've been told that it will eventually have them.
People could donate regular money in exchange for Ripple IOUs at interest.
If you don't want to have returns, people can just donate ripple
credits or donate regular money some other way.

I hope this helps, but don't hesitate to ask whatever you don't find clear.

[Apostolis Xekoukoulotakis]

Crowdfunding projects in the way kickstarter does, in which all funds are returned if the goal isnt reached requires the reversibility of the transfers of money.

Having a third party manage the transfers ,would be the easiest way,but with limited amount of credits along the path of transfer, even then the reversibility might not be possible until later.

I would prefer a distributed way.

Anyway I would like this feature too. It would be cool to be able to crowdfund open source projects for the well being of humanity. ( http://opensourceecology.org/ )

2013/1/14 Jorge Timón <jtim...@gmail.com>

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Sincerely yours, 

     Apostolis Xekoukoulotakis

[Adam Wascholl]

You can simulate this with two accounts. Your regular account would be
A, where you trust all your friends. With A you trust B by the overall
negative limit and B trusts A for the overall positive limit. You use
B to pay. Your friends will only owe (or be owed by) A.

 

I guess you could make a similar work around using mutliple accounts.

Probably the easiest solution is for your friend to make a different
account for the agriculture project.

Isn't there any way to do it without creating multiple accounts?  It just seems like a lot of work when one account can have different parameters set up to direct the flows of credit.  I understand if it would be difficult and maybe even unnecessary to build it into the system at first, but I feel like it would be beneficial in the long run. 

[Jorge Timón]

I would say this is the simplest solution. Of course a client could
implement a different interface for the user simplifying what he sees.

For the overall limits isn't much work> you just need one additional
account that is only connected to the main account.

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Jorge Timón

http://freico.in/

http://archive.ripple-project.org/

[Adam Wascholl]

As a non-programmer, what are some ways I can help with the testing of the new Ripple implementation?

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~A

[Jorge Timón]

You should ask the team for access to the client being tested.
You access it by pressing the button "Start Ripple" in this page
https://ripple.com/
but access is restricted, ask for it at be...@ripple.com

Then just use it, find bugs and report them here:

https://github.com/rippleFoundation/ripple-client/issues

Maybe you want to read some of the opened (and closed) issues first,
since some of them are just misunderstandings on how it works. But
don't be afraid to open an issue that is wrong: they will just explain
you the functioning and close the issue.

You can create multiple accounts to test. But don't use it for real
things, since some times they restart the ledger and your data will be
lost.

> ~*A*

[Jorge Timón]

First of all, I don't mean to implement interest in the same way
ripplepay does. As I've told you before, I wouldn't even have trust
lines nor currencies (the 3 letter tag), only currencies (each address
is one) and exchange rates (orders). That's what we have planed for freicoin,
maybe you can reuse somethign from our design in the makings.

> There are two possibilities:
>
> If you know what the time horizon for the loan is, you don't need an
> interest rate. You can just charge more for the credit.
>
> If you don't know what the time horizon for the loan is, charging interest
> breaks everything. For example, say someone owes you $10 at 15% APR. The
> Ripple network could either discharge this loan or pay you $12. Which would
>
> you prefer? Without knowing the time horizon, there is no way to know. Or
> say you could pay for a book either using $10 at 15% from one person or $9
> at 11% from another person. If you don't know which person is likely to pay
>
> you back first, how can you know which is the better deal?

You're only considering the use case of the payer paying at interest,
which I don't consider very important. Anyway, since you don't know the time
horizon, I would say a century would be a safe default.
Would many people pay anything at 1% interest for one century?
I don't think so, but what's the problem?
After all, the payer always choses the path, different clients can
have different settings depending on the user. But that's just about
defaults and clients, shouldn't be a concern for the server part.

> So with interest, you'd have to set time horizons on everything and you'd
> lose money if you guessed wrong. With a charge for the credit, you don't
> have to set time horizons on anything, but you can still lose money if you
> guess wrong and underprice or overvalue.

Without interest you're not taking time into account. Ripple as it is
cannot be used for p2p lending or implementing local demurrage
currencies, for example.
We plan to support both things in Freicoin.

> We plan to support charging interest through the contracts system, but it
> seems to me that it's a vastly inferior mechanism to simply charging for
> the extension of credit based on the expected time horizon. It's certainly
> easier than having to manually guess the time horizon for every single
> obligation and set it somehow.

Forget about time horizons and let's play with some use cases.
I'm assuming each address is a currency and each address has a fixed
interest/demurrage rate.

No I want to borrow 100 bitstampUSD at 5% interest.
I create a new account timonUSD5 with 5% interest.
I create an offer "100 bitstampUSD for timonUSD5".
You want to lend me those 100 usd, so you accept it.
I will have 100 bitstampUSD and you will have 100 timonUSD that grow
at 5%.
Now you set an offer "all my timonUSD5 for bitstampUSD at 1:1"
To pay you back, I only have to buy my IOUs back from you. The earlier
I buy them back, the less interest I pay.
Any problem with this so far?

Another use case, let's say I start a freicoin gateway. I create a new
account with the same demurrage Freicoin has, to be applied each 10
minutes.
Say someone has an offer "1000 timonFRC for 10 davidUSD"
That offer can be rippled without any problem, but there's two
possibilities here:

1) When the account making the offer has less than 1000 timonFRC, the
order gets unfunded and thus cancelled.

2) (The one that we've chosed for FRC) The amount of timonFRC in the
order is adjusted throughout time for demurage, but the rate
(100:1) remains constant.

Maybe there's another better way to do this within Ripple so that you
don't have to refactor the whole server, but I think this is certainly
the best thing for "ripplecoin".

We're still designing (Mark and I), but you can have a look at what we have
specified so far (sorry, still a little bit dirty):

https://docs.google.com/document/d/1nnul3oDO5z8sspWBKgTKKSjQ7dWoOqU4Pd8DILLmFN8

One of the things we don't have ready yet, but that I want to do since
quite a while is to support private transactions ala Ryan's two phase
commit, using the chain as commit method as default. Not only that, I
want atomic hybrid Ripple transactions with private and public parts
in it.

Feedback welcomed. I would also be pleased to help you integrate
whatever parts you find interesting into your own design however I
can. I want "full ripple" (as I see it idealized in my mind) to be in both PoW
chains and in ledger consensus. The closer both designs are, the more
easily inter-operable they will be. And the more synergies we can have.
I think Ripple could support interest and hybrid public/private
transactions like we want for Freicoin. You would need something
different from refHeight though, as ledgers don't tend to be 10 min
distanced of one another (by the way, we're going to change the
difficulty filter on Freicoin).

Feel free to ask anything about our design.

[David Schwartz]

You can use the new Ripple this way if you wish. However, Ripple also use gateways which act kind of like banks to get money into and out of the system without having to rely on inter-personal lines of credit. Essentially, you deposit funds with the gateway and the gateway gives you a credit balance in Ripple, which you can then transfer or exchange.

DS