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RIPPLE Ripple’s CTO clarifies that Interledger Protocol [ILP] is not connected to the RippleNet yet

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2 minutes ago, BobWay said:

I think that it is deceptively hard to replicate. It seems like it should be technically easy (and it is), but the hard parts are compliance and liquidity based. That is where Ripple has be working the hardest.

it's also short sighted to think of XRP as being synonymous with xRapid and not the other products. While it may seem so at the moment, it should be clear from the RippleNet diagrams that they all fit together into a comprehensive system where each component builds on the others.

It turns out that international payments through crypto draw nicely on paper, but there are a lot of moving parts.

1. Alice generally has to send money from her account through the local currency system to a compliant exchange.

I get the liquidity part of the equation being difficult, but I’m not positive about the compliance part. Is it because of the AMA/KYC piece? If so, is that not handled by the banks? If it’s the security issue, then will compliance become a low hurdle for competition to enter once regulation is set in place? I guess I’m struggling to see how compliance will be a major problem 1,2, or 3 years down the road.

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13 hours ago, BobWay said:

I think that it is deceptively hard to replicate. It seems like it should be technically easy (and it is), but the hard parts are compliance and liquidity based. That is where Ripple has be working the hardest.

it's also short sighted to think of XRP as being synonymous with xRapid and not the other products. While it may seem so at the moment, it should be clear from the RippleNet diagrams that they all fit together into a comprehensive system where each component builds on the others.

It turns out that international payments through crypto draw nicely on paper, but there are a lot of moving parts.

  1. Alice generally has to send money from her account through the local currency system to a compliant exchange bank account.
  2. The exchange has to detect the local bank transfer and then credit that money to someone on the exchange.
  3. The local currency has to be traded at the current rate for crypt
  4. The crypto need to be sent via blockchain to the remote exchange
  5. The crypto needs to be credited to someone on the exchange.
  6. The crypto needs to be traded at the current rate for the remote currency.
  7. The remote currency needs to be moved off the exchange and credited to someone at that exchange's bank
  8. The money needs to be send from the account at the exchanges bank to Bob's account through the local system.

Then of course you find out that Bob closed his account last week. So the whole process needs to suffer a lossy reversal process. But all of that is really easy conceptually...

Later you realize that sending money to a local exchange and trading it for crypto yourself is normally a series of two-party transaction. (otherwise known as "just doing business"). Exchange are setup and compliant for these types of transactions. But sending payments generally require three (or multiple) party transaction. This turns "just doing business" into "money transmission" which is highly over regulated in every country and state. Aaarrrggg!

Oh wow, where were you like 6 months ago when we were all speculating as to how this process would work! I am very, very, very grateful for your time and knowledge!

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@BobWay clearly the best info in a very long time, but also reads as if Ripple and their products are not as near to "Breaking it wide open" as Brad leads us to believe in his exuberant globe trotting interviews.

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34 minutes ago, 010101 said:

@BobWay clearly the best info in a very long time, but also reads as if Ripple and their products are not as near to "Breaking it wide open" as Brad leads us to believe in his exuberant globe trotting interviews.

Except for all those times he's said this is a marathon and we're in mile 1

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Posted (edited)
1 hour ago, doopers said:

Except for all those times he's said this is a marathon and we're in mile 1

I would counter and say Euro Exim this is your bank? Dozens of banks will use xRapid in 2019 BG says? If they are all like Euro Exim with less than 1 million in assets the collective wealth of this forum is far greater. 

Yes, crawl, walk, run, but the caliber of the latest "partners" are disappointing to me.

Edited by 010101
can't spell

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19 hours ago, BobWay said:
  19 hours ago, Raz said:

I think my big question is how difficult it is to replecate what Ripple is trying to achieve with XRP and xRapid.

 

19 hours ago, BobWay said:

I think that it is deceptively hard to replicate.

Come on, Bob! You act as if you are re-inventing money or something! 

I am impressed by the complexity of Ripple's foresight and by their willingness to "pivot" at critical times to make this new, freedom inspired, idea of money a blossoming reality for the people and countries of the world. Thank you again for bringing your insight to the xrpchat. I think your presence can go a long ways in forwarding the legitimacy of Ripple and xrp.  

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46 minutes ago, VanGogh said:

I am impressed by the complexity of Ripple's foresight and by their willingness to "pivot" at critical times to make this new, freedom inspired, idea of money a blossoming reality for the people and countries of the world. Thank you again for bringing your insight to the xrpchat. I think your presence can go a long ways in forwarding the legitimacy of Ripple and xrp.  

Thank you very much VanGogh! 

Ripple has pivoted from time to time. Sometimes it wasn't a full Silicon Valley pivot, more like a shift in focus between alternatives that were being explored. I've agreed with some in the past and disagreed with others. In general it a group of great people all attempting to do the right things in the right order in the face of many unknowns.

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Posted (edited)

Thoughts on non-Ripple developments which use XRP/XRPL?  Personally, that's where the "fun" is, for me, in thinking about this stuff, last year or so...  The rest of it's just a wait(-on-the-state(s)-)state... so I push out onto the edges of what's being developed, where I suspect there may be non-linear potential... just to keep myself entertained. :)  At the moment, I'm watching ILP (what I think of as universal, but what you're calling v4) Ping Protocol get developed - and the picture I'm using is that the 0-value pings are sort of analogous to X-Rays in crystallography... (yeah, I usually go for the weird visual metaphors...)

Anyway, back down to things I can write, instead of just visualize:

Curious about your familiarity w/non-Ripple ecosystem around XRP (and/or ILP) --- what you think is fun / interesting / promising... esp given your role wrt STREAM...

(Total honesty:  "Whatcha got cookin'?")

Edited by NightJanitor
can't forget ILP (and might as well go for total honesty)

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12 hours ago, BobWay said:

I never read Ripple's press releases or watch the interviews. I always felt it was my job to understand  the deeper view.

I can't really say when it will "break wide open", but I do see from first hand experience that banks and financial companies are pack animals. I can't tell you how many times I heard a version of, "We'd like to be your very first, second customer." Personally, I'm bullish on 2019 being a very good year.

Thanks for turning my topic into gold. It's so refreshing to hear someone speak that actually understands the technology and not just speculating on how it works. Very much appreciated! 

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On 3/7/2019 at 8:01 AM, Scout said:

Thanks for turning my topic into gold. It's so refreshing to hear someone speak that actually understands the technology and not just speculating on how it works. Very much appreciated! 

it's my pleasure @Scout. It is really hard to figure out what topics are currently misunderstood, until someone like you asks the question directly. To me, nothing is more important than asking good questions to the people who thought they'd already explained things clearly. That is the only way to get them to improve their explanations.

On 3/6/2019 at 8:05 PM, NightJanitor said:

Curious about your familiarity w/non-Ripple ecosystem around XRP (and/or ILP) --- what you think is fun / interesting / promising... esp given your role wrt STREAM...

Actually one of the reasons I'm here is to learn what the non-Ripple ecosystem is doing. Please clue me in, I'm definitely behind the curve.

I do have some idea of what Stefan and Coil are working on. He is pretty open so I'm sure everyone here does as well. I'd like to follow up on what Evan is doing. He was key to the idea of streaming payments. Personally I think it is one of those crazy ideas that could change everything. But it might also be one of those crazy ideas that people have trouble wrapping their head around.

I tend to be an old fuddy duddy at times. Fixing "grown up" payments is fine with me as a goal. Streaming payments taking to its full potential is clearly a complete reinvention of money.

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On 3/5/2019 at 4:03 PM, BobWay said:

One of the reason I wanted to make an account here was to comment on this particular thread. So apologies for resurrecting something slight older.

Without contradicting David or Evan, I'd like to add a bit of context here.

The Ripple product xCurrent does use "The Interledger Protocol" (ILP) version 1.0 in atomic mode. I can say this authoritatively because I was the original architect of RippleConnect (renamed xCurrent) and also part of the Ripple research team during the creation of ILP. One of my key contributions to the protocol was "atomic mode". This is absolutely the right technology for multi-party payments among banks. This includes same currency and cross currency inter-bank transactions. ILP 1.0 atomic mode was specifically designed to "synchronize" multi-party accounting transactions. That is the concept you see referenced here by the Bank of England in their survey

This call for interest explains the concept well.

There are some awesome related threads on this site as well. Here and here. I apologize if I missed others.

Synchronized (atomic) payments among banks is one of the key technologies in Ripple's arsenal. It is hard to overestimate how important it is.

----

On interledger.org what Evan was referencing as "the open interledger" is implemented using ILP version 4 (penny switching). You might ask what happened to ILP v2 and ILP v3. I often ask myself that as well. ;-)  It turns out that those were rather short term interim proposals between ILP v1 and ILP v4. Even more confusing is that there were two different view points on ILP v4 as well. I called them "grown up payments" vs "penny switching". ILP v4 PS is a really mind blowing way to think about reducing payment risk by via "packet switching" analogies with the internet. (I'm happy to go into all the details and differences elsewhere if people are interested.) ILP v4 penny switching serves as the underlying technology for ILP "streaming payments". This is one of the key concepts that is so exciting about Coil!

The important thing to understand is that ILP v4 is NOT a semantic versioning of an incrementally improving ILP v1 (xCurrent) product. The two were designed for different use cases and different user bases. ILP v4 is a second high speed clearing layer (analogous to lightning) that is built to complement the ILP v1 settlement layer (analogous to bitcoin).

----

The two "protocols" are designed to complement each other, however, at the moment the two "networks" don't overlap. This shouldn't cause concern if you understand what the short and long term goals are. Banks are focusing on bank to bank atomic (instantly settled) payments. Individuals are focused on high speed p2p clearing with (currently) ad hoc settlement. If you think of the individuals participants as accounting networks, then they create two (currently) disconnected graphs. This is fine while "the open interledger" is gaining its peer-to-peer feet. But it should be expected that those parties will replace their current ad hoc settlement relationships with standard ILP v1 interbank payments once those API's become available at the consumer level.

The way I understand the current jargon is:

RippleNet: is a bank focused network build using Ripple's xCurrent, xRapid & xVia products. These products are base on ILP V1 atomic mode but are currently being referred to as RippleNet rather than as "The interledger".

The Open Interledger: is a group of individuals building a network using recent interledger.org public standards. These are based on ILP V4 clearing protocols.

The term "THE interledger" creates a hugely unfortunate and unbelievably confusing naming clash. I hope I've done a little to clarify it.

Thank you! Turns out I am one of the few outsider who know what's actually going on. Note that I didn't say it's v1 in the tweet. But I can imagine that it's unlikely that xCurrent moved from v1 to v4.

 

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