Right now there are only a few gateways in the Gateway List.

I think the idea is that traditional banking institutions will become gateways. Note that no action is required on your part for this to happen, thanks to the Federation Protocol. You already trust your bank now. Maybe you get a paycheck with direct deposit. You probably pay your bills out of it.

Imagine a Ripple enabled bank account. You could buy Bitcoins directly, using the money in your checking account, without the need for doing a wire transfer or ACH payment. You could deposit Bitcoins at a gateway, sell them in the Ripple order books, and receive the U.S. dollars directly into your checking account again without having to wire or do an ACH payment.

If you don't trust the bank, you could always withdraw your money as Bitcoins or XRPs and hold cryptocurrency instead. You could keep your bank account, and periodically  liquidate small amounts from your cryptocurrency stash into U.S. dollars held in your bank account to do things like pay bills.


I'm not sure I follow. OpenCoin isn't creating any IOUs (XRPs are not debt). Gateways should only issue IOUs in amount equal to what they have on deposit. I imagine that as Ripple gains acceptance, one of the ways that a gateway will establish trust is to use open-accounting systems to prove that they have not over-issued IOUs. With Bitcoin it's easy to audit a public address in the block chain.