What is Ripple? 4 1921

ripple

Now you’re down with Bitcoin and Ethereum, if you heard about the Banco Santander announcement about a partnership with Ripple, you may be wondering – what is Ripple? Is it just another cryptocurrency like Bitcoin? And if so, does that mean that one of the world’s largest banks is now accepting payments in cryptocurrency?

No, and definitely not. What’s going on, then? Let’s take a closer look.

Rather than just a digital coin, Ripple is a remittance network, currency exchange and real-time gross settlement system (RTGS). Going back to 2012 when it came out, Ripple (unlike Bitcoin) does not actually use the blockchain system. It uses what is known as a common ledger, which is essentially a network of independent servers that validate transactions constantly.

If you’re thinking, “that sounds a lot like the blockchain,” that’s because it is. Ripple’s shared public database also uses a form of consensus. The majority of the network has to be in agreement on the validity of transactions, to prevent events like a 51% attack.

Unlike Bitcoin though, Ripple doesn’t rely on a proof-of-work (PoW) concept, or the computational power of members of the network. It also isn’t mined.

The token is XRP and its main characteristic–the raison d’etre of Ripple–is that it allows for real time exchange of currency between two parties, whether that be fiat currency, gold, or any other type of currency. Its major claim to fame is that it allows people to avoid wait times, fees, and even exchanges transactions.

How is Ripple Different From Bitcoin?

As mentioned, the technology they rely on is different. Ripple is more targeted to banks and other FSIs (as displayed through the Banco Santander partnership). While Bitcoin was built for the people, Ripple was built for enterprise. Sure, you can buy and trade it peer to peer, but that’s not what this cryptocurrency is all about. It’s to move massive sums of money around safely and practically instantly. That’s what’s getting the banks all excited.

And today, it is still the fastest cryptocurrency for transactions, settling payments in a maximum of four seconds, as compared to Ethereum, which can be a few minutes, and Bitcoin, which can take several hours. Another main difference is that this cryptocurrency is not mined, like Bitcoin, Ether, and other cryptocurrencies. They just settled on 100 billion tokens from the get-go and issued that many coins.

In theory, the 100 billion XRP tokens originally issued are meant to be the only tokens there will ever be. But there is technically nothing to stop Ripple from issuing any more. But, they probably won’t, seeing as the XRP token is completely separate from Ripple’s technology. Banks can send currency in dollars, yen, or pounds, without needing to use XRP at all, making the investment in this token somewhat less attractive. Without doubt, Ripple’s value is the network, not the Ripple coin.

Banks can use its software for fast, international payments (as is the case with Banco Santander) and can ditch the traditional SWIFT method, that is slow and cumbersome.

Is It Volatile as Well?

Yes. Like most cryptocurrencies, the markets are very sensitive to FUD and FOMO. As the price of Bitcoin exploded towards the end of last year, Ethereum doubled and Litecoin blew up, Ripple also experienced a massive price hike, with first time investors looking to purchase cryptocurrency within their price budget. Moreover, a rumor was spread that Coinbase was thinking of listing it on their exchange and that shot the price up further…

Until Coinbase quashed the rumor and the price came crashing back down.

Against an Ideology?

Bitcoin purists have criticized Ripple, because it has owners. It is a centralized network in the middle of a decentralized, idealistic ecosystem. Also, the trusted Unique Node List (UNL) that is supposed to protect Ripple from hackers and threats throws up another issue: while it protects the cryptocurrency, what’s to stop a  government or regulating body from coming in and making a change?

It is certainly an interesting technology and worth keeping on your radar. But, unless you’re working in a large financial institution, you probably don’t need it too much of it in your investment portfolio.

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Christina is a technology and business communicator who has worked with high profile ICOs and blockchain influencers to break industry news.

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Freelance Terrorist Carried Out Hundreds of Bomb Threats in Exchange For Bitcoin 43 2495

An American-Israeli teen is sentenced to a decade in prison after a Tel Aviv court convicted him for a series of fake bomb threats he carried out in exchange for Bitcoin.

The 19 year old began making threats professionally at the age of 16. He is convicted only for crimes committed while over the age of 18. These include making false threats and reports, extortion, money laundering, and conspiracy to commit a crime.

While the Israeli courts withheld the defendant’s identity because some of his alleged crimes occurred while he was a minor, the Guardian identified him as Michael Kadar at the time of his arrest. He was originally indicted for over 2,000 bomb threats, carried out between 2015 and 2017.

Kadar Targeted Children and Jewish Community Centers

The targets of Kadar’s threats included Jewish community centers, the Israeli Embassy in Washington DC, elementary schools, shopping centers, hospitals, law enforcement agencies, airports and airlines.

A threat to an El-Al flight resulted in the deployment of fighter jets for an escorted emergency landing; another threat to a Canadian airport left six people injured during emergency disembarkment; a Virgin flight dumped eight tons of fuel before landing because of a threat; and another threat went to a plane carrying the Boston Celtics.

Kadar also targeted Republican Delaware state senator Ernesto Lopez, who he threatened with blackmail and the murder of his daughter. After Lopez ignored the demands, Kadar ordered drugs to have sent to Lopez’s residence.

Dealing Terror From Mom and Dad’s Apartment

His reign of terror operated from his parent’s fifth floor apartment near the beach in a posh neighborhood in Ashkelon, about 30 miles south of Tel Aviv. But his threats landed in over a dozen countries, including Ireland, New Zealand, Germany, Denmark, Great Britain, Belgium, Australia, Norway, Argentina, Israel, the United States, and Canada.

“One can easily imagine the terror, the fear and the horror that gripped the airplane passengers who were forced to make an emergency landing, some of whom were injured while evacuating the plane,” read the verdict by judge Zvi Gurfinkel, “and the terrified panic caused when there was a need to evacuate pupils from schools because of fake bomb threats.”

The Judge also divulged Kadar’s fees for his services: $40 for a threatening phone call to a private residence, $80 for a bomb threat to a school, and $500 for an airplane scare. Kadar operated on the dark net and disguised his IP address, using a powerful self-installed antenna to tap into remote networks, and software to mask his voice. According to an indictment filed against him in Florida, he spent some of his calls going into graphic detail threatening the deaths of children in American Jewish centers.

A Small Fortune in Bitcoins

At the time of his arrest, Kadar had amassed around 184 Bitcoins for such services—about half a million dollars at the time, and closer to $680,000 today. He also dealt in bomb making manuals, drugs, and child pornography.

Kadar is the son of an American mother, and his father is an Israeli engineer, and has dual citizenship. The US Department of Justice has also indicted Kadar for 32 crimes, including hate crimes, cyberstalking, giving false information to the police, and making threatening phone calls to around 200 institutions. A separate indictment also accuses Kadar of threatening the children of a former CIA and Pentagon official with kidnapping and murder, and links him to over 245 threatening calls.

When Kadar was arrested, he tried to escape by grabbing a pistol from a police officer, but was wrestled to the ground. Thursday’s conviction follows a cooperative investigation by the FBI and Israeli authorities, who have not been able to recover Kadar’s Bitcoins.

Teen’s Mother Calls Conviction ‘Cruel’

Kadar’s mother spoke outside the courtroom after her son’s sentencing, saying “This is the most cruel, cruel thing in the world. I’m very sorry, but I am ashamed that the country acts this way.” She insisted that her son needed treatment, not prison.

In an earlier interview she told Israeli TV her sun was suffering from a brain tumor, which made school difficult for him. Because of this and his autism, Kadar was homeschooled.

Defense lawyer Shira Nir said these conditions made Kadar unfit to stand trial, as he could not distinguish right from wrong. A medical panel confirmed the defendant’s autistic condition, but concluded he was capable of understanding the consequences of his actions. Judge Gurfinkel said Kadar’s conditions were taken into account, lessening the sentence from 17 years in prison to 10.

There’s an Inflatable ‘Bitcoin Rat’ Staring Down the Fed 93 11261

Someone has put a giant inflatable rat outside the Federal Reserve Bank in New York.

It’s covered in Bitcoin code, printed in rainbow colors, and is apparently a piece of installation art aimed at subverting the federal institution that controls the US dollar. Or is it pale, puffed-up pariah a commentary on Bitcoin bros themselves? Or does it have something to do with Warren Buffett, who earlier this year called Bitcoin “rat poison squared”? According to CoinDesk, who first reported on the inflatable rat, the meaning is intentionally ambiguous.

The artist behind the puzzling prank is Nelson Saiers. He describes his own work as “mystifying” and “singularly original”, notwithstanding the long history of rats being inflated as protests or used as economic and political icons in art and entertainment around the world.

“It’s art, so I hope they’re entertained by it,” he said, apparently implying that art is entertainment. “It’s informative, I hope people will learn [and] I’m hoping it’ll at least help people understand bitcoin better and be kind of faithful to what Satoshi would have wanted,” he added, citing the mysterious pseudonym of Bitcoin’s founder with a touch of reverence.

A $50 Million Artist

Saiers, a phD in theoretical mathematics, was a hedge fund manager who did that thing where you give up all the money to chase your dream of being an artist.

His financial experience includes a stint as managing director at Deutsche Bank’s prop trading desk, before becoming CIO of Saiers Capital, the hedge fund that bears his name. His creative career gives credence to the theory that working as an artist is more and more a privilege of the very wealthy.

CNBC estimated Saiers’s wealth to be around $50 million at the time of he departed from the financial industry to pick up his paintbrushes.

The Rat Joins a Tradition of Sculpture-as-Commentary in FiDi

The Bitcoin rat, which stands on Maiden Lane, isn’t the first pop up sculpture to grace Manhattan’s financial district. Last year, Kristen Visbal’s 50 inch bronze ‘Fearless Girl’ statue made waves by staring down the famous ‘Charging Bull’, to the outrage of ‘Charging Bull’ sculptor Arturo Di Modica. The 3.5 ton ‘Charging Bull’ itself was left on Wall Street in the middle of the night when Di Modica originally created it, obstructing traffic and drawing the curiosity of passers by.

When Saiers placed the Bitcoin rat, he initially set it up on private property and was promptly ushered off by security guards, who he says were good natured about the situation. He expects the sculpture to be more temporary than the aforementioned Wall Street bronzes, and will probably only be around for a few days.

A Critique of the 2008 Bailouts

The placement of the rat on Maiden Lane seems to be no accident, but rather a reference to the Maiden Lane Transactions, more commonly known as that time when the Fed bailed out the big banks after they all caused the 2008 market crash. The Bitcoin crowd’s antipathy towards the Fed and the big banks is palpable in Sairs’s rat sculpture, and while a more specific meaning eludes, perhaps the success of the piece depends upon its ability to start conversations about the state of finance.

We’ll leave it to the viewers to decide who’s the rat—the Federal Reserve, or Bitcoin itself—and what that means for the future of currencies.

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