That idiot who replied to you didn't understand what MP wrote.
MP is stating that when I deposit $1000 in a bank and get IOU back (which I can trade a la the gold certificates of private banking in the 1800s), then I expect to be paid an interest rate and I expect that bank to make a statement as how many IOUs they will issue relative to reserves they have in the vault. Ripple does neither.
Well to be fair it seems this is more a criticism of banking in general, not Ripple. I'm not aware of Ripple claiming they'd reform banking practices. From my understanding they're simply designing a system that can allow banks to operate more efficiently.
And MP also states correctly that Ripple places all those who receive IOUs from the same entity on equal footing, which the idiot who replied to you didn't seem to grasp. The reason this is bad, is because then I can't sue that issuer without a class action lawsuit. And large players can't negotiate for seniority in a default liquidation scenario.
In other words, Ripple has none of the features required for private banking to function correctly.
I would be happy if you posted my rebuttals there.
I'll leave it at that. Unless you want to further discuss over there. I'm just taking it all into consideration and not looking to really go back and forth too much.
Perhaps banks think they will like Ripple because they can use it just as settlement layer and have their own side agreements on the aspects which Ripple doesn't enforce:
Fundamentally, Ripple has a much better chance of getting regulated and being brought to a major market, like NYSE or BATS, than bitcoin because it is more centralized. There is also a lot of banks around the world that are looking at ripple as a form of real-time gross settlement. To banks, a system like Ripple has a lot of advantages over bitcoin . Banks really aren't interested in "alternative money" like Bitcoin and other cryptocurrencies , they're interested in the underlying distributed ledger technology, and that is exactly what Ripple is. They WANT more control over the system, they don't want to give up control to miners who are securing the network based on the price of the currency, they like distributed ledgers because they can actually give banks more control over their back-end systems, bitcoin will probably never be used for this, and as such, Bitcoin and Ripple should be seen as completely different technologies. Some people like to say Ripple has no value because it is centralized, or because the fundamentals are so different from Bitcoin , but that is simply not the case. It is just valuable for different reasons and big Banks definitely see the value in Ripple, while they've been pretty cold towards Bitcoin . This sets the stage for Ripple to have a pretty massive long-term bull-run now that all the weak hands are out of the market and new money is flowing into cryptocurrency .
See also:
https://www.quora.com/Does-Ripple-have-a-chance-of-disrupting-the-banking-industryhttp://bitcoin.stackexchange.com/questions/40530/why-banks-are-trying-consensus-algorithms-like-ripplehttp://www.cnbc.com/2016/06/22/banks-trial-ripple-blockchain-to-make-international-money-transfers-like-sending-an-imessage.htmlhttps://ripple.com/insights/how-banks-use-ripple/I'll do some further reading. thanks.
The problem for Ripple is what is the fungible unit of transfer? So banks are going to transfer XRP? Then how can they do fractional reserve banking because Ripple doesn't allow transferring XRP minted by a private bank, unlike Lightning Networks which is in theory could if users blindly trust the centralized hubs.
Ripple would only be useful for trades between banks on their mutual trust of their own USD.chase, EU.sandanter, etc..
I expect Ripple to collapse as the sovereign debt crisis goes into defaults probably next year.
So some soon to be non-existent banks like Ripple. Who cares.
Well, that was my point earlier. I don't see banks becoming non-existent "soon". Are you talking 5, 10 or 20 years when you say that?