RippleNet and it's parts

[KarmaCoverage]

In short, RippleNet is the combination of all...

xCurrent does messaging and can do settlement if desired for existing nostro/vostro relationships that are nonFX payments. By selling xCurrent to regulated banks, the banks already meet the regulatory requirements for their jurisdiction, so that makes xCurrent and it's part of RippleNet regulatory compliant.

xRapid is for connecting Exchanges where there is open market trading liquidity available for FX to XRP, and all the Exchanges are connected to XRPLedger. It must have Exchanges using it before, banks using xCurrent can connect to it. Once a bank is connected to both xCurrent & xRapid, it can work with xVia.

xVia is for the Corp Treasury departments, it is just an API that enables them to send/receive payment requests to/from their bank using xCurrent and xRapid for payment processing...

...and then the payment will go through the whole RippleNet system, which is tied together end to end with ILP.

Here is what it all looks like...

I have seen a lot of confusion around which products do what. If any of this is inaccurate please let me know. I hope this helps concisely explain what RippleNet is, and how it's parts are tied together.

Edited February 15, 2018 by KarmaCoverage

[lll_lll]

How easy it from someone who currently is using xCurrent to move to xRapid?

[Dutchpinoy]

11 minutes ago, lll_lll said:

How easy it from someone who currently is using xCurrent to move to xRapid?

From what I've heard, it's currently pretty rapid.

[lll_lll]

I have heard that too but I was wondering about the technical aspects of the barriers that could be.

[KarmaCoverage]

I just dont think xRapid is fully out of beta yet.

xRapid has a LOT of exchanges to integrate with, it makes it easy for the banks/xCurrent users to integrate with xRapid once, and functionally be integrated with all the exchanges. Now that ILPv4 is settled upon, I think it may help make all the necessary connections, if the exchange does not already have an existing API.

I saw one interview where Evan or Stephan said that one exchange they integrated xRapid with was going very slow. They finally figured out that the exchange's API was only running a cron job once per hour, (because that is slow enough for bitcoin). Once they updated the cron job frequency, the end-to-end payments went much faster through xRapid. Which shows that even though XRPLedger is 3-4 seconds, it is the slowest ledger in the path that is the bottle neck

Edited February 16, 2018 by KarmaCoverage

[Lumpy]

1 hour ago, KarmaCoverage said:

xRapid ... all the Exchanges are connected to XRPLedger ...

Hello, actually it's not true. Not all the exchanges are connected to the XRP Ledger. Some of them but not all. XRP can source liquidity off-blockchain.

[lll_lll]

I am wanting to know a bit more in-depth about the technical aspects of ILPv4 and RippleNet. Can you guys point me to few resources?

[KarmaCoverage]

14 minutes ago, Lumpy said:

Hello, actually it's not true. Not all the exchanges are connected to the XRP Ledger. Some of them but not all. XRP can source liquidity off-blockchain.

If they are going to complete a payment through xRapid, where there is an XRP payment from Exchange A to Exchange B, then both must have an account on XRPLedger.

Also, how are they selling XRP if they dont have any, and the only way to own XRP is to have in in an account/wallet on XRPLedger.

I do think you are right in a sense, we doing know the deal terms Ripple Inc has with Exchanges, and since xRapid is not out of beta (I think) it would be safe to assume not all Exchanges are xRapid enabled yet.

5 minutes ago, lll_lll said:

I am wanting to know a bit more in-depth about the technical aspects of ILPv4 and RippleNet. Can you guys point me to few resources?

here you go

 

[Lumpy]

16 hours ago, KarmaCoverage said:

If they are going to complete a payment through xRapid, where there is an XRP payment from Exchange A to Exchange B, then both must have an account on XRPLedger.

Once again, it's not true. 

It's well explained in the post (1) below written by JoelKatz.  

XRP exchanges can take place off-blockchain. Imagine I bought 10 XRP through the XRP Ledger. Then I write a paper/ contract that says the 10 XRP now belongs to you. The change of property is made and there is no evidence of that in the XRP Ledger. 

It's exactly how private exchanges (Poloniex, Bittrex, etc.) work. They first buy a pool of XRP directly from the company. This transaction appears in the XRP Ledger. However, what happen next regarding this pool of XRP is completely off-blockchain.

As mentionned in the post (2) by mDuo13 (Ripple Employee),

Quote

xRapid uses public exchanges that trade XRP to source liquidity from speculators and other members of the public who're trading cryptocurrencies for fiat and vice-versa. It pairs trades at different exchanges in real time and transfers the XRP between exchanges. It is, in a sense, a really polished standard interface to the exchanges' own APIs.

Sourcing liquidity among exchanges can be done via ILP technology that makes the bridge/ reconciliation among different private ledgers. Then XRP can still be used as a liquidity tool without its native and public network: the XRP Ledger.

This architecture/ model does make sense in a business perspective. The RippleNet is the denomination of the private network held by the company. Ripple's FI clients do not want that their exchanges/ transactions appear public on a public network. On top of that you can add the poor liquidity within the XRP Ledger and the limited corridors available (GBP does not even exist on the XRP Ledger).  

I hope that will help! 

 

(1)

 

(2)

 

[Guest]

43 minutes ago, Lumpy said:

(1)

 

that thread is amazing

[KarmaCoverage]

@Lumpy what Joelkatz is saying is true, and I would say it does Not qualify as a cross ledger transaction... if everything is done on the Exchange's single ledger (Polonex).

2 hours ago, Lumpy said:

Sourcing liquidity among exchanges can be done via ILP technology that makes the bridge/ reconciliation among different private ledgers. Then XRP can still be used as a liquidity tool without its native and public network: the XRP ledger.

You are mixing terms up here just a little bit. There is no "liquidity to source" through ILP.

ILP alone enables 2+ ledgers to pass a payment between them... but Only if the liquidity is already on Both ledgers. You can't do an ILP payment without someone having value deposited on Both ledgers before the tx.

The only way xRapid can do a cross-ledger transaction enabled by XRP, is if one hop in the payment path is on XRPLedger.

That said, banks can honor existing nostro/vostro relationships at whatever FX rate they want, not touching XRPLedger at all.

Back to joelkatz Polo example, This is similar to how stock brokerages work for customers wanting to sell a stock. The brokerage will internally match the sell order with other customers buy orders... but the brokerage (like the polo exchange) does not go to the public stock market (public XRPLedger) and actually buy & sell the shares. It's not really that simple, but it is often all done on the Brokerage's internal ledger.

Mduo13's example shows an actual xRapid cross ledger transaction, with step 3 being the XRP to XRP transaction on XRPLedger.

...so "no more GBP on ledger"? This sort of sucks, IOUs and all the things that RCL can do is what attracted me to Ripple in the first place. To see much of that abstracted away, and off ledger (like the polo example) is somewhat sad.

That said, I think enabling many of these things to happen off ledger is a good idea, it will make more funds flow around XRPLedger, much like the Polo example is depicting.

The more value flows around XRPLedger, the more value will flow through it.

[Lumpy]

@KarmaCoverage we are having a very interesting and deep conversation! Good!

37 minutes ago, KarmaCoverage said:

You are mixing terms up here just a little bit. There is no "liquidity to source" through ILP.

I understand what you say. You are right. However, ILP provides the technological framework that enables XRP to be used as a bridge/ liquidity asset.

If you are looking, for instance, to exchange USD for Mexican Pesos. You will first deposit USD to a private exchange. You will then buy XRP for USD. Send a payment to another private exchange that proposes/ allows to trade XRP for Mexican Pesos. You will then sell XRP for Mexican Pesos then proceed to classic/ bank withdrawal. 

XRP is used as a bridge digital asset: USD/XRP > XRP/PESOS 

44 minutes ago, KarmaCoverage said:

ILP alone enables 2+ ledgers to pass a payment between them... but Only if the liquidity is already on Both ledgers. You can't do an ILP payment without someone having value deposited on Both ledgers before the tx.

You are right, you need two accounts on both platforms.

50 minutes ago, KarmaCoverage said:

The only way xRapid can do a cross-ledger transaction enabled by XRP, is if one hop in the payment path is on XRPLedger.

Here you are wrong. Having two accounts and trading XRP on both platforms does not mean to have a XRP wallet address on the XRP Ledger. The XRP Ledger won't be used at any moment in the process.  

57 minutes ago, KarmaCoverage said:

The only way xRapid can do a cross-ledger transaction enabled by XRP, is if one hop in the payment path is on XRPLedger.

So no and definitely no

58 minutes ago, KarmaCoverage said:

It's not really that simple, but it is often all done on the Brokerage's internal ledger.

It's only done on the ledger of the private exchange. All of it. There is no tx within the XRP Ledger.

1 hour ago, KarmaCoverage said:

with step 3 being the XRP to XRP transaction on XRPLedger.

You are wrong. Mduo13 does not talk about the XRP Ledger in his example. The example is valid on and off-blockchain from a to z.

 

 

Today the XRP Ledger is mainly used as a store of value. Read this post and the response from JoelKatz.

 

[KarmaCoverage]

3 hours ago, Lumpy said:

The RippleNet is the denomination of the private network held by the company.

Ripple Inc does not necessarily need to know about a banks xCurrent connections to other xCurrent using banks.

I doubt the banks would agree to let Ripple Inc know about or manage their interbanking relationships.

I believe the banks will buy the xCurrent tool for managing those relationships, then use the tool to do so themselves.

So Ripple does not own RippleNet as a network, they sell the software that enables RippleNet to be. (Nobody owns the internet.)

Now, Ripple inc could own an opportunity to make some money off of value flowing through the network. My guess is that xRapid may give some spread on a hop or two of the end-to-end tx. This could mean huge profits at large volumes of value flow.

[Lumpy]

7 minutes ago, KarmaCoverage said:

So Ripple does not own RippleNet as a network, they sell the software that enables RippleNet to be. (Nobody owns the internet.)

Right! 

[KarmaCoverage]

10 minutes ago, Lumpy said:

It's only done on the ledger of the private exchange. All of it. There is no tx within the XRP Ledger.

If two exchanges both run xCurrent, Im not sure if they actually do, xRapid may be enough for Exchanges?.. but if they did they can create their own direct connection or tunnel for XRP, not on XRPLedger exactly like banks can do with fiat nostro/vostro relationships.

However, I think you are overlooking Settlement. XRPLedger is the only ledger that can do final settlement of XRP. 

So assuming two exchanges trade XRP off ledger with eachother and they don't experience a perfect balance of funds flowing each direction... then at some point they will want to do a net settlement and bring the relationship back into balance. At this point they must do an on XRPLedger transaction. 

...but what you are describing is not a cross ledger transaction. It is simply an exchange shifting balances between internal accounts. Does not matter at that point if the balance transfers are USD, Euro, XRP, or whatever, it has nothing to do with RippleNet at all, just internal transfers all on one same ledger.