Wiki: Ripple (monetary system)
Bitcoin 2.0: Can Ripple Make Digital Currency Mainstream?
Fast Company
It has been a nail-biting year for people who hold Bitcoins, an open-source digital currency that has quickly gained traction in the tech community. Last June, Bitcoins were worth $5. By April 2013, they were up to $266. Then they dropped to $70 in April. They were back up to $108 by May 7. Bitcoin is volatile. We know that much. It’s also vulnerable. Mt. Gox, the biggest Bitcoin exchange (where users go to exchange Bitcoins for other currency)--was recently faced with multiple DDoS attacks , shutting down the site temporarily.
But here’s the thing about open-source currencies: they’re open to improvement. Ripple, a platform that just received funding from Google Ventures, Andreessen Horowitz, Lightspeed Venture Partners, and others, has created both an alternative to Bitcoin and a distributed currency exchange for Bitcoiners (and others) who aren’t comfortable using only Ripple’s currency, known as XRP.
Bitcoiners could have reason to be suspicious of Ripple right off the bat. Whereas Bitcoin was created anonymously and relies on a foundation to standardize and protect the currency, Ripple is the product of OpenCoin, a public-facing company that just raised funding from a number of firms. OpenCoin plans on holding 25% of all the XRP in existence--the idea being that as the currency becomes more valuable, the company will have more resources to fund its operations (and presumably, to make its founders quite wealthy). There’s nothing intrinsically wrong with OpenCoin wanting its currency to rise in value, but the system is dramatically different from Bitcoin.
OpenCoin co-founder Chris Larsen believes that having a central company behind the currency is to its users’ benefit. "Bitcoin does a great job with a group of folks working through a foundation, and ad hoc contributions," he says. "We thought we could get that too, and also get a core group to nurture this thing for a few years."
The Mechanics of Ripple
The Ripple platform serves two purposes: it’s a distributed open-source payment network, and it’s the home of the newly minted XRP currency. As a payment network, Ripple provides free global payments without chargebacks (minus a $0.0001 per transaction network charge, implemented as a security precaution against hackers), the ability to pay in any currency using a distributed currency exchange, and an open protocol that any developer can use. "The Ripple network is a protocol. It’s like HTTP for money. Users, merchants, anyone can use it for free without a license," explains Larsen.
Participants can exchange dollars, yen, Euros, and even completely made-up currencies, all of which are entered into the system via "gateways." Larsen says: "A UI designer and myself can be a gateway to each other. A gateway can be a friend, neighborhood, a group. Most gateways will be larger. It’s like the way Paypal works--you give them $100, they create a $100 balance." The largest Ripple gateway right now is Bitstamp, which is used to buy and sell Bitcoins.
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Full Article:
http://www.fastcoexist.com/1682032/b...ncy-mainstream
Other Articles:
Ripple Labs Announces $3.5 Million Investment Round
IDG Capital Partners and Google Ventures Invest in Ripple Developer OpenCoin
The Crypto Currency Company That Google is Investing In
Bitcoin rival Ripple looks to make waves
'Ripple' Digital Currency Challenges Bitcoin
Bitcoin Maverick Returns for New Crack at Digital Currency
Now Backed By Andreessen & More, OpenCoin Looks To Build A Better Bitcoin — And A Universal Payment Ecosystem
What comes after Bitcoin?
The promise of Ripple
Ripple, a Peer-to-Peer Financing Network, Could Make Bitcoin Great (Or Destroy It)
Google Ventures invests in OpenCoin, the firm behind Bitcoin exchange Ripple
'Ripple' is the New Bitcoin: Adventures in Virtual Currency
How Ripple Plans to Take on Bitcoin
Core Innovation Capital Backs Ripple Labs
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