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For those worried about XRP being classed as a security


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14 minutes ago, marousi said:

What do you mean "another" lawsuit? As far as I know, this is the only lawsuit regarding XRP being a security, it is just summed up by different media. If there are other lawsuits regarding this topic, please post the sources here. The way you wrote your post seems like there are countless security lawsuits piling up on Ripple :D

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If they use the Howey Test, there's no way it's a security. I'm worried about the Howie Test, though...

Cobalt is really just an update of the consensus mechanism at the heart of the XRPL. It turns out that in the presence of untrustworthy (byzantine) nodes, then the XRP ledger is not as theoretically s

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1 hour ago, jbjnr2 said:

Cobalt is really just an update of the consensus mechanism at the heart of the XRPL. It turns out that in the presence of untrustworthy (byzantine) nodes, then the XRP ledger is not as theoretically safe as had been assumed previously. Fortunately, there are currently only nodes run by ripple/banks/trusted friends, so everything is ok, but as decentralization moves accelerate, then the possibility of including nodes that want to disrupt the network or are just faulty/slow increases. What they are doing with cobalt, is decoupling the ordering of valid transactions from the running of the ledger update mechanism so that the consensus can be reached using cobalt, but the ledger can be updated/maintained using a faster layer (like the current XRPL mechanism) that is tightly coupled to it.

With the current XRPL you can imagine that each validator has neighbours that are the ones that it must agree with. It turns out that if you and I are neighbours in the network, then we must share 90% of our other neighbours, so 90% of my nodes are also your nodes - if this condition isn't met, then the network could halt and stop making progress when there are problems or untrustworthy nodes. Cobalt allows this number to drop to 60%. What this means is that you can introduce a lot more nodes that are distant friends, and decentralize the network much more effectively. It also cannot get stuck. So XRPL could in theory halt in its current implementation if too many nodes were added that were unreliable - cobalt will not ever get stuck (by stuck we mean that different nodes come up with different ledger updates and can't agree on which ones are 'right'). If the network halts, then no transaction can go through and a backlog builds up. This would be disastrous in a production system.

With cobalt, decentralization is easier, safer, more reliable and a little bit faster, but it doesn't fundamentally change anything in the way XRP actually works. The lightning network doesn't really address any of these issues, it's just a form of payment channel for making fast transfers off-ledger between two endpoints. Cobalt will make the network provably safe against a wide range of problems and is the kind of thing that banks will want to use to guarantee that their customers are protected and the system remains up and running without interruption.

HTH. I apologise that this is not a thorough review of the cobalt paper. It is my intention of doing a full review of it when I have time to read it through a few more times and I will post my review to this forum.

 

Thanks, this is a great explanation that helps me understand what Cobalt does.  Have not seen it put like this before before

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This SEC meeting will obviously hear evidence, are they likely to give a verdict quickly or do these sorts of decisions take ages to agree and report on?

I get the feeling that Ripple Labs are concerned that there is a small chance that the decision could go against them (courts are made of vulnerable people that often make bad decisions) and have been concentrating on putting hands off distance between Ripple Labs and the XRP tokens that is 20% owned by the founders of Ripple and the preferred coin for use with their software modules XRapid and XVia.  I also get the feeling that institutions are hesitant about getting involved until after this decision is made.  The other side of this coin is that if XRP is ruled as not to be a security (the most likey outcome) there will be a surge in investment and value.

If the ruling goes against XRP should we sell, let the dip happen and rebuy at a cheaper price?

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2 hours ago, Julian_Williams said:

This SEC meeting will obviously hear evidence, are they likely to give a verdict quickly or do these sorts of decisions take ages to agree and report on?

I get the feeling that Ripple Labs are concerned that there is a small chance that the decision could go against them (courts are made of vulnerable people that often make bad decisions) and have been concentrating on putting hands off distance between Ripple Labs and the XRP tokens that is 20% owned by the founders of Ripple and the preferred coin for use with their software modules XRapid and XVia.  I also get the feeling that institutions are hesitant about getting involved until after this decision is made.  The other side of this coin is that if XRP is ruled as not to be a security (the most likey outcome) there will be a surge in investment and value.

If the ruling goes against XRP should we sell, let the dip happen and rebuy at a cheaper price?

I'm confident a SEC ruling will turn out in favor of XRP. In the off-chance the verdict is 'security', I'm out as this will mean an enormous fundamental shift I'm not comfortable keeping money in. I'd probably not buy back in as there'd be very little left of XRP's proposition and utility value as a bridge currency. I'm still all in and I'm prepared to lose everything if SEC ruling goes Hawaii.

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5 minutes ago, Dutchpinoy said:

I'm confident a SEC ruling will turn out in favor of XRP. In the off-chance the verdict is 'security', I'm out as this will mean an enormous fundamental shift I'm not comfortable keeping money in. I'd probably not buy back in as there'd be very little left of XRP's proposition and utility value as a bridge currency.

Can you explain why you think a security determination for XRP would be negative for Ripple? I don't see it, so I'd like to know what I'm missing.

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12 hours ago, Tinyaccount said:

but I am sure that Ripple and I have a similar goal. 

Yes you both have the goal of becoming wealthy. However your goal requires XRP adoption to become successful, where Ripple only needs XRP to fund their goal of making their "agnostic" software successful. You feel you are in a partnership with the dealer, but he has multiple decks, and your cards are truly optional.

How many rubber trees would you buy, for their gum, based on the fact the Goodyear makes billions, manufacturing tires, and the fact that rubber trees are so scarce? Would you re-evaluate if you found out that the gum can be easily synthesized and tires are "gum agnostic?"

BTW: I have said that the majority of "experts" on this chat site have repeatedly bashed other members for stating what you now claim is common knowledge. What happened to the additional 20% savings when using XRapid/XRP? What happened to BG and his suitcase full of cash, flying across the Atlantic. Mr. G. never used the term "any digital coin" when making his analogies for settlement.

Unfortunately Ripple is going to learn how fast their loose lips, sink their ship. Twitter along with all of those undisciplined interviews will be used against them. Nothing easier than self incrimination. If XRP is indeed NOT required or somehow preferred in RL's software offerings, then RL has no dedicated use case for XRP, and they have a very weak defense of their fundraising methods.

I call it the "Jobs effect" Where every young entrepreneur now feels they also need to become a cult icon or celebrity. Being wealthy and successful was not enough. Need that fame. Well, splash goes the bone into the pond.

If you are correct, 2018 will be a write off, but at least Mr. Schwartz will have thousands of twits following him. Unfortunately, one cannot buy a cheeseburger with "likes"

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1 hour ago, Valhalla_Guy said:

Yes you both have the goal of becoming wealthy. However your goal requires XRP adoption to become successful, where Ripple only needs XRP to fund their goal of making their "agnostic" software successful. You feel you are in a partnership with the dealer, but he has multiple decks, and your cards are truly optional.

How many rubber trees would you buy, for their gum, based on the fact the Goodyear makes billions, manufacturing tires, and the fact that rubber trees are so scarce? Would you re-evaluate if you found out that the gum can be easily synthesized and tires are "gum agnostic?"

BTW: I have said that the majority of "experts" on this chat site have repeatedly bashed other members for stating what you now claim is common knowledge. What happened to the additional 20% savings when using XRapid/XRP? What happened to BG and his suitcase full of cash, flying across the Atlantic. Mr. G. never used the term "any digital coin" when making his analogies for settlement.

Unfortunately Ripple is going to learn how fast their loose lips, sink their ship. Twitter along with all of those undisciplined interviews will be used against them. Nothing easier than self incrimination. If XRP is indeed NOT required or somehow preferred in RL's software offerings, then RL has no dedicated use case for XRP, and they have a very weak defense of their fundraising methods.

I call it the "Jobs effect" Where every young entrepreneur now feels they also need to become a cult icon or celebrity. Being wealthy and successful was not enough. Need that fame. Well, splash goes the bone into the pond.

If you are correct, 2018 will be a write off, but at least Mr. Schwartz will have thousands of twits following him. Unfortunately, one cannot buy a cheeseburger with "likes"

So, have you sold your stack?

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12 minutes ago, HenrySeldom said:

So, have you sold your stack?

No need to sell, I only invested what I could afford to lose?, and I am barely below water, not to mention that TRON has more than made up for XRPs short term performance. I am a Hodlr who hates FUD, almost as much as I hate CRUD (Constant reassurance using disinformation). Do we honestly fight both on this site?

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13 hours ago, Tinyaccount said:

Um er...   Your post made it appear that I had said the words that Graine had actually said.  Please edit it to fix that.  I do NOT agree with what Graine was saying there and would like the record corrected please.

Fixed. sorry about that. Didn't mean to put words in your mouth.

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8 hours ago, jbjnr2 said:

Cobalt is really just an update of the consensus mechanism at the heart of the XRPL. It turns out that in the presence of untrustworthy (byzantine) nodes, then the XRP ledger is not as theoretically safe as had been assumed previously. Fortunately, there are currently only nodes run by ripple/banks/trusted friends, so everything is ok, but as decentralization moves accelerate, then the possibility of including nodes that want to disrupt the network or are just faulty/slow increases. What they are doing with cobalt, is decoupling the ordering of valid transactions from the running of the ledger update mechanism so that the consensus can be reached using cobalt, but the ledger can be updated/maintained using a faster layer (like the current XRPL mechanism) that is tightly coupled to it.

With the current XRPL you can imagine that each validator has neighbours that are the ones that it must agree with. It turns out that if you and I are neighbours in the network, then we must share 90% of our other neighbours, so 90% of my nodes are also your nodes - if this condition isn't met, then the network could halt and stop making progress when there are problems or untrustworthy nodes. Cobalt allows this number to drop to 60%. What this means is that you can introduce a lot more nodes that are distant friends, and decentralize the network much more effectively. It also cannot get stuck. So XRPL could in theory halt in its current implementation if too many nodes were added that were unreliable - cobalt will not ever get stuck (by stuck we mean that different nodes come up with different ledger updates and can't agree on which ones are 'right'). If the network halts, then no transaction can go through and a backlog builds up. This would be disastrous in a production system.

With cobalt, decentralization is easier, safer, more reliable and a little bit faster, but it doesn't fundamentally change anything in the way XRP actually works. The lightning network doesn't really address any of these issues, it's just a form of payment channel for making fast transfers off-ledger between two endpoints. Cobalt will make the network provably safe against a wide range of problems and is the kind of thing that banks will want to use to guarantee that their customers are protected and the system remains up and running without interruption.

HTH. I apologise that this is not a thorough review of the cobalt paper. It is my intention of doing a full review of it when I have time to read it through a few more times and I will post my review to this forum.

 

Great stuff thank you!

So in other words, if i'm not mistaken, the better comparison would be between Lightning and  Ripple's PayChan (which is off ledger and can scale 50,000+ tps).

cobaltdecentralized.JPG.ba08cf3e419b2ddb1027741f3433e5f6.JPG

cobalt.png.4d65287dcd4dbae9b8d7c9f19d96669d.png

Cobalt sounds very promising!

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3 hours ago, Benchmark said:

Then Ripple accepts their choice and moves on. You win some, you lose some. 

The point is, if the bridge crypto asset is negotiable, why would anybody choose XRP if there are better (read: more liquid) choices of such assets? Settlement speed, on-chain TX costs and externalized costs like PoW all factor into the decision, but in terms of the bottom line, the main factor in the efficiency of bridging through an asset is its liquidity... XRP seems to be sub par in that regard, for its valuation. There are even some ERC20s with more volume than it, so it really isn't looking good in that regard

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38 minutes ago, corak said:

The point is, if the bridge crypto asset is negotiable, why would anybody choose XRP if there are better (read: more liquid) choices of such assets? Settlement speed, on-chain TX costs and externalized costs like PoW all factor into the decision, but in terms of the bottom line, the main factor in the efficiency of bridging through an asset is its liquidity... XRP seems to be sub par in that regard, for its valuation. There are even some ERC20s with more volume than it, so it really isn't looking good in that regard

@corakI brought this point up earlier in the thread, but I think it deserves repeating here.   None of the existing assets have the liquidity needed to bridge even a fraction of daily world cross-border payments/transactions handled by the likes of SWIFT and FOREX markets, including BTC.  Current liquidity may be enough for a small number of remittance payments, but that's it as of today.   IMO, it is also unlikely a client would specify that its implementation of xRapid use a particular asset, as long as the service they signed up for provided them with the fastest and most cost-effective method of transacting.   Do you care which servers or ISPs your TCP/IP traffic flows through as long as you can surf the web and send e-mail quickly?   Explicitly requiring the use of a differing asset in regard to an xRapid implementation (other than what is standardized by the service, which is currently XRP) would at this point be purely for political reasons.

With respect to the ERC20 volume comment, the vast majority of volume in this market is speculative demand, which changes on a whim and is not based on any fundamentals whatsoever.   Yes volume for some ERC20s may be higher today, but is it sustainable without a solid use case?   Who knows.

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It seems to me Xrp is an example of an asset that could appear as a security in some cases and not in others.  If someone is hodling, that appears to be a security.  If someone is using Xrp to transfer value, that doesn’t appear to be a security.

In which case it seems difficult to tell how the SEC would make a call.  There are a whole host of situations that will fall in between the two situations.  If I hodl for a week, then transfer, then cash out, what is that?   I would have said path of least resistance for SEC is to avoid declaring it a security, and avoid a legal battle with Ripple.  However, there may be people in the wings who would go legal with SEC (more serious than this current stupid lawsuit) if it wasn’t declared a security.

Important key I think is decentralisation.  US is only one jurisdiction, ripple need to (and obviously is, they don’t need me telling them) guide the Xrp ledger to decentralisation as one of its highest priorities

#xrpthestandard

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