1. Beverly Hills Hotel participates in the Ripple network and issues its USD-denominated IOUs which are redeemable for hotel stays.

  2. Beverly Hills Performance Car Rentals participates in Ripple network and issues its USD-denominated IOUs redeemable for car rentals.

  3. Both the hotel and the car rental shop have unrented inventory.

  4. Daily room rental rate in USD is roughly the same as the daily rate to rent a Ferrari.


Can the hotel owner and the owner of the car rental business exchange their respective IOUs through either a mutually trusted gateway/nexus or directly (assuming they trust each other) or through a web of trust to allow a room to be rented out for a day of stay and a Ferrari rented out for a day of driving ?

Bonus question:

Is this the real purpose of the "issuer" field in the current Ripple user interface, i.e. to allow any participant to issue IOUs denominated in any currency of their choice ?

  • I can answer your last question in the affirmative. The goal is definitely for it to be possible for anyone to issue an IOU in any currency (standard or even customized like "owe you a beer") if someone else is willing to accept it. The underlying system is designed to fully support it. For example, currencies are just 160-bit numbers to the network. Issuers are just regular accounts. Feb 16, 2013 at 6:22

1 Answer 1


Currently currencies are limited to three-character codenames, so although this can be done and will work it will probably be useful to establish some convention(s) that will help people to not get too confused.

For example your examples seem to amount, in general, to "store credits", like airmiles or giftcards in a way. Thus it might be better to use a code for them that is different from the national cash they might happen to be useable on par with "at the store". So maybe instead of having lots of "different" IOUs labelled as USD most of which are not really someone owing an actual USD but, rather, someone owing in store credit, in other words goods or services, whose retail price happens to be in USD, it might be good to use USC or USX or whatever, the three letter code conventions only use two for the nation, deliberately leaving one for distinguishing between variants (such as day old dollars or tomorrow dollars or some such strangeness I think).

In general though, ripple docs already say that it is okay for a gateway to refuse to cash out people who are not actual members of that gateway, so that gateways can insist on knowing the customer and having anti money laundering data about that customer and so on. So we are told up front already that gateways are not under any obligation to actually make good on their IOUs to just any Tom Dick and Harry. Since that is already said, why not take it a step farther and say "oh yes I am a gateway, but only to people who buy my merchandise, and only up to the actual amount, per such person, that person spends at that moment on my merchandise".

I just think that would be a heading toward being kind of sleazy as compared to right up front setting your IOUs as not being USD but store credits, so people don't end up confusing them with actual fiat debt.


  • In the example above presumable both businesses would want to denominate their IOUs in USD but make them redeemable only at their place of business, hence their are effectively private currencies but measured with a common USD metric. Still, presumably the whole existing b2b barter $70 Billion USD per year industry as represented by imsbarter.com and 10's of other "barter exchanges" most of whom are just poorly designed websites ... My hope would be that Ripple could thrive and enable such "excess inventory without hard cash" exchange which would otherwise not happen at all. Feb 16, 2013 at 21:45

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