Answer: My Dinner with David

[BobWay]

I just wanted everyone to know that Dinner with David (and four other great guys) was awesome! I really did come away pumped after our long discussions. The fact that everyone at the company is in agreement that David & Arthur's  original (and later my) "long term" vision for XRP acting as a bridge currency has/is/was/will always be the guiding star forward. At least that is the way I heard it in my head. David can make his own public statements.

But what PUMPED ME UP the most was that it is no longer seen as a "long term" vision. It is a focused activity that the company NEEDS to pursue now. But best of all, they ARE all actively pursuing it, NOW! To David, they all seem unified in the realization that, XRP as a bridge currency, has changed from a “WANT to happen” to become a “NEEDS to happen.” Or else TIME will shift from working with Ripple, to working against Ripple.

The early Ripplers really, truly BELIEVED in the concept of a cryptocurrency and everything the fine folks on this forum believe. However, Ripple, for all the right reasons, hired the true cream of the crop from the financial services industry. Their experience gave Ripple insight into MANY many ways to improve payments and communication within the financial networks of the world. But they were not intrinsic fans of cryptocurrency. They were open to the idea of course. But still harbored some skepticism.

For a long time it was fine with everyone if Ripple was seen as an enterprise banking software company. But that silly pipe dream evaporated as everyone realized how much more value could be created by shifting the focus back to XRP. Ripple still makes great enterprise banking and payments software. That will never stop. But Ripple is most definitely a cryptocurrency focused company again!

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Keep in mind, some of what I said above is perhaps owed to my interpretation of what David said and its personal impact on me, colored by my history with the company. I'm not a reporter quoting David's exact words. He speaks for himself. I'm writing my personal impression of what I heard along with my feelings about it. This may not be the official company position.

But know that nothing we talked about was private. At best it was semi-private. We were all in the middle of a crowded restaurant talking pretty loudly. We were also all talking openly to people at the table neither David nor I had ever met before that moment. So I'm not selling out my friend or saying things whispered to me.

(David didn’t say this next part.)

I personally believe that the company is dramatically revisiting every situation where the software licensing cost was seen as a barrier to entry for institutions. I personally believe that was a case of “false economy”. Ripple the company benefits much more from the customers that small and medium size banks bring, then they do from any licensing fees they could charge the banks.

Hearing what David has to say made me ecstatic…

(But I want to be clear about why. I don’t want anyone mistaking what I’m saying as, “XRP to the moon, next week.” XRP will go to the moon, absolutely, in my mind. But I have no idea when.)

… The reason it made me ecstatic, was that a long while back Stefan nicknamed me Cassandra. In Greek mythology, “Cassandra is cursed to utter prophecies that were true but that no one believed.”mI actually got a substantial raise that on my review said, “I have to rate you highly, because your initial ideas always end up being the ones we implement...  wait for it  ...after trying every other possible alternative. So truly believe me when I say me being ecstatic was not financially related or something you should trade on.

The reason was pure vanity.

Edited March 18, 2019 by BobWay
I am not a reporter. These are not direct quotes. Edited to show this is my opinion and impression.

[BobWay]

11 hours ago, Truckdriver said:

so wen Gottfried Leibbrandt

So true story. I met Wim Raymaekers and talked to him for more than two hours on the floor of the Bitcoin Amsterdam conference in May 2014. He was fascinated at all the things I demonstrated to him that Ripple could do. Our pitch was "Access, Speed, Certainty, Cost" at that time as well as now.

Well the next day Wim reappeared with this other nice fellow named Gottfried. Wim asked me to demonstrate to Gottfried what I'd shown him. I was very keen to tell the both of them how interested Ripple was in working with SWIFT. I saw the two technologies as quite complementary (actually I can still make that case). The three of us talked for almost two more hours.

Now keep in mind I had no idea who either of these guys were. Usually just rank and file employees walk the floor at conferences and discuss details with tiny new companies for three and a half hours. If they weren't SWIFT employees I would have thought they were monopolizing my time. The rest of the people manning the booth actually got annoyed I was talking to them for so long.

Also keep in mind these were not meeting planned in advance nor did we have a quiet room. The stood shouting over the noice with me that whole time. (How could those guys be particularly important?) Also note that in Banking and Finance everyone has pompous titles. I never knew what to think. In banking, VP means "entry level".

So these were very productive conversation and I tried very hard to sell them on the idea of a partnership. When they finally left, both deeply understood what Ripple (now XRPL) could do. So I expected them to call Patrick and set up an "important people" meeting.

But no. Shortly afterward SWIFT announced the Global Payments Innovation Initiative (GPII) now (GPI). Look at the dates for GPI on Wim's resume. Even their collateral matched Ripple's almost point per point. (I couldn't find the initial release online.)

Of course, I thought it was highly improbable that I had anything to do with their decision. SWIFT is a big company and probably works on lots of things for years before talking about them. But later, I was introduced to a SWIFT employe who was actually on the GPII team. So I told him the story and asked if it was correlation or causation. He said, "No, we had nothing like that going on. Wim and Gottfriend came in right after their trip and said, "We have a new number one priority..." and that turned into GPII. So it was in direct response to the (unintentional) fear I caused in both of them.

Edited March 18, 2019 by BobWay

[BobWay]

52 minutes ago, Cryptsycrackers said:

You probably mentioned before, but I haven't had time to read anywhere near all this new information.

Was wondering since you think XRP will moon, at some point whenever that is, what your definition of moon actually is?

Read moar! 

I'm going to talk about that when I finish the "my price thread" shortly. (I hope)

[BobWay]

13 minutes ago, Truckdriver said:

@BobWay I think Diliop Rao is incredible as a speaker , he is all class and do not hear enough from him. A true example of "cream of the crop". It's hard for him to shine when he is surrounded by star's.

He is a great friend of mine. I worked closely with him on trade finance in Singapore. He also built an amazing team in Sydney. The are truly spectacular!

[BobWay]

5 hours ago, ixb2454 said:

I am a little bit surprised that you talked like that with competitors. If ripple is not 5 years ahead, i would see that as a serious problem.

The funny thing is that the XRP Ledger (formerly Ripple Ledger) were not and are not competitors. They simply don't do the same thing at all. In fact they are completely complementary.

• The XRP (Ripple) Ledger is an accounting system that executes multi-party atomic (rippling) payments.
• SWIFT is a secure reliable email system between bank. The messages just tell the banks how they should so the accounting.

Swift works great for what it does. Messaging. They say they've never lost a message and I believe them. The problem is with the sequential nature of the messages. This causes different banks to do their internal accounting at different times. If some forget or fail to do their part, the end-to-end payment fails. But in reality, this failure has ZERO to do with swift.

What I wanted to do was let SWIFT continue to be the end-to-end messaging layer. This allows every bank along the chain to decide if they want to participate in a payment. Once everyone agrees, the Ripple (XRPL) then makes sure that NO ONE can screw up the accounting. Atomic means, everyone or no one.

So you can see, it would have been a beautiful partnership. I really can't see how I f***ed that up. Sorry Ripple. Mea Culpa

[BobWay]

1 hour ago, DividendGamer said:

Why would every bank be necessary? Surely there would be a consensus layer that would have been used to speed up approval.

I love it when you point out where I'm not clear. Thank you!  Let me try again and make me continue until I get better.

It would be possible to have a consensus process that help approve new banks to participate in the system, if that is what you meant. 

But what I'd like everyone to realize is that each "payment" moves through multiple banks and payment systems. Each of those has certain regulatory requirements they need to comply with on a payment by payment bases. The make these decisions independently. So that type of decision is not a good candidate for consensus. So what happens in the current system is:  Alice asks to send a payment to Bob. Alice is at a small bank in the US. Bob is at a small bank in Brazil. So a payment path might look like this:

• Alice ---> Alice's Bank ---> Alice's Bank's Correspondent Bank -----------> Bob's Bank's Correspondent Bank ---> Bob's bank ---> Bob

So the first thing that happens is Alice asks her bank to send a payment to Bob. The next thing that happens is her bank says: "Who's Bob? Hey's not a customer of ours. We need to "know or customers" (KYC) when we process payments. You first you'll need to fill out these forms about Bob in Brazil and why you are sending him money. Since we also need to make sure you aren't laundering money (AML) of financing terrorism (OFAC). So Alice fills out a big form and hands it over. The bank types everything into their system for transactions screening and give is OK to go. Then immediately after, Alice's bank debits Alice's account.

Only then does it try to figure out if it even CAN make the payment. So it sends a SWIFT message to their correspondent saying, "Hey, please debit our (Alice's Bank's) account with you, and pass this money along toward Bob. And their correspondent says, "Whose Bob? Oh, and by the way whose Alice?" So the bank passes that form information along with Alice's customer info to their correspondent as well. Who then runs that through their KYC, AML, and OFAC screening systems and OKs the payment as well.

So they send a SWIFT message to their foreign correspondent saying. "Hey, please debit our account and pass this money along to Bob." and they do all of the above and again it is OK. So they pass the message through SWIFT (or local rails) to Bob's bank. And they credit Bob's bank on their books.

And Bob's bank receives the message and sees the money in their account. And then goes to credit Bob's account and realizes, "Hey, Bob closed his account last week!"

But all the money has been moved along the chain. So now all of those accounting transactions have to be reversed. So the SWIFT messages start again from right to left reversing the transaction.

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What Ripple's Pre-Validation layer implements is a common standard for all of these messages. (SWIFT's standard is quite quirky) And it implements a protocol that allows each bank to do all of their transaction screening, BEFORE any money moves. If they all "validate" the transaction. Only then do they send the payment along through the atomic accounting system (XRPL or ILP).

If SWIFT has partnered with Ripple early on, all the work of that new messaging layer could have been built more quickly upon SWIFTS existing infrastructure and relationships.

The above statements were my personal opinion at the time. It was not a company plan nor even a direction we had discussed before the moment I crossed paths with Wim and Gottfried. That conversation was just a happy coincidence. Keep in mind, at that time I had those conversations with strangers every day. Also, RippleNet did not exist and Ripple did not sell anything. We gave our software, help and tech support away for free to anyone who wanted to build upon the (Ripple) XRP Ledger.

Also note the pre-validation process is describe in Ripple public collateral in many place including this one. Look for the "messenger" component on page 10.

Everyone, please realize that I'm not telling you secrets. I'm telling you how to correctly interpret all the material Ripple is already providing to you in order to learn. I'm just a teacher. I am not out to subvert any plans that Ripple might have. Or to disclose private company information to competitors.