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CreditRelationshipExample
Main.CreditRelationshipExample History
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September 26, 2010, at 07:45 PM
by - clean up
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%cframe width=2400px% %width=2350px%https://ripplexchange.com/images/diagrams/Ripple.png | '''An illustration of Ripple credit relationships'''
to:
%cframe width=1100px% %width=1050px%https://ripplexchange.com/images/diagrams/Ripple.png | '''An illustration of Ripple credit relationships. Right-click and view or save image to see full detail.'''
September 26, 2010, at 07:43 PM
by - clean up
Changed line 77 from:
%cframe width=1600px% %width=1550px%https://ripplexchange.com/images/diagrams/Ripple.png | '''An illustration of Ripple credit relationships'''
to:
%cframe width=2400px% %width=2350px%https://ripplexchange.com/images/diagrams/Ripple.png | '''An illustration of Ripple credit relationships'''
September 26, 2010, at 07:41 PM
by - clean up
Changed lines 19-20 from:
Ryan-Thomas USD Credit Relationship
to:
Ryan-Thomas USD credit relationship
Changed line 23 from:
Ryan's issuance limit: 1,000 (could be set to, eg, 1 billion, if Ryan wants no issuance limit)
to:
Ryan's issuance limit: 1,000 (could be set to unlimited if Ryan wants no issuance limit)
Changed lines 26-27 from:
Thomas's issuance limit: 5000
to:
Thomas's issuance limit: 5,000
Changed lines 29-37 from:
Balance of Payments: 0
Ryan'sAvailable Credit with Thomas: 500 (smaller of 500 and 1,000)
Thomas'sAvailable Credit with Ryan: 1,000 (smaller of 1,000 and 5,000)
Time passes, and Thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 Ripple payment to Ryan." The credit relationship now is as follows:
Credit/Issuance Limits unchanged.
Balance ofPayments:
Ryan's
Thomas's
Time passes, and Thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 Ripple payment to Ryan
Credit/
Balance of
to:
Balance of payments: 0
Ryan's available credit with Thomas: 500 (smaller of 500 and 1,000)
Thomas's available credit with Ryan: 1,000 (smaller of 1,000 and 5,000)
Time passes, and Thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 Ripple payment to Ryan". The credit relationship now is as follows:
Credit/issuance limits unchanged.
Balance of payments:
Ryan's available credit with Thomas: 500 (smaller of 500 and 1,000)
Thomas's available credit with Ryan: 1,000 (smaller of 1,000 and 5,000)
Time passes, and Thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 Ripple payment to Ryan". The credit relationship now is as follows:
Credit/issuance limits unchanged.
Balance of payments:
Changed lines 42-43 from:
Thomas's available credit with Ryan: 800 (smaller of (1000-200) and 5,000)
to:
Thomas's available credit with Ryan: 800 (smaller of (1,000-200) and 5,000)
Changed lines 46-48 from:
Credit/Issuance Limits unchanged
Balance ofPayments:
Balance of
to:
Credit/issuance limits unchanged
Balance of payments:
Balance of payments:
Changed lines 55-60 from:
to:
Notice how the balance from both of their perspectives remains the same size but in opposite directions. Ryan and Thomas are tracking the balance of credit in their relationship.
!!!Running into limits
Ryan would now like to buy a laptop from Thomas, which Thomas is selling for $1,200.
!!!Running into limits
Ryan would now like to buy a laptop from Thomas, which Thomas is selling for $1,200.
Changed lines 62-63 from:
So, Ryan adjusts his issuance payment upward to $1,300 in order to make the payment. We now have
to:
So, Ryan adjusts his issuance payment upward to $1,300 in order to make the payment. We now have:
Changed lines 67-68 from:
to:
Ryan then purchases the laptop for $1,200, and we have:
Changed lines 70-76 from:
Balance of Payments:
+300 (from thomas's point of view)
-300 (fromryan's point of view)
Ryan'sAvailable Credit with Thomas: 200 (smaller of 500-300 and 1,300)
Thomas'sAvailable Credit with Ryan: 1,300 (smaller of 1,000 + 300 and 5,000)
-300 (from
Ryan's
Thomas's
to:
Balance of payments:
+300 (from Thomas's point of view)
-300 (from Ryan's point of view)
Ryan's available credit with Thomas: 200 (smaller of 500-300 and 1,300)
Thomas's available credit with Ryan: 1,300 (smaller of 1,000 + 300 and 5,000)
+300 (from Thomas's point of view)
-300 (from Ryan's point of view)
Ryan's available credit with Thomas: 200 (smaller of 500-300 and 1,300)
Thomas's available credit with Ryan: 1,300 (smaller of 1,000 + 300 and 5,000)
September 26, 2010, at 07:28 PM
by - clean up
Changed lines 1-2 from:
There is a basic explanation of the Credit Relationship concept at [[Definitions]].
to:
There is a basic explanation of the credit relationship concept at [[definitions]].
Changed lines 5-6 from:
to:
!!The credit relationship
Ryan and Thomas represent two neighbor nodes with a credit relationship between each other that has been registered with some Ripple server.
Ryan and Thomas represent two neighbor nodes with a credit relationship between each other that has been registered with some Ripple server.
Changed lines 11-12 from:
Ryan wants to limit himself to going no more than $1,000 in debt with Thomas, and Thomas wants to limit himself to going no more than $5,000 in debt with Ryan.
to:
Ryan wants to limit himself to going no more than $1,000 in debt with Thomas, and Thomas wants to limit himself to going no more than $5,000 in debt with Ryan.
Changed lines 15-16 from:
Initially, neither node has used any of its line of credit
to:
!!The balance
Initially, neither node has used any of its line of credit.
Initially, neither node has used any of its line of credit.
Changed lines 22-23 from:
Thomas's Credit Limit: 1,000
Ryan'sIssuance Limit: 1,000 (could be set to, eg, 1 billion, if Ryan wants no issuance limit)
Ryan's
to:
Thomas's credit limit: 1,000
Ryan's issuance limit: 1,000 (could be set to, eg, 1 billion, if Ryan wants no issuance limit)
Ryan's issuance limit: 1,000 (could be set to, eg, 1 billion, if Ryan wants no issuance limit)
Changed lines 25-27 from:
Ryan's Credit Limit: 500
Thomas'sIssuance Limit: 5000
Thomas's
to:
Ryan's credit limit: 500
Thomas's issuance limit: 5000
Thomas's issuance limit: 5000
Changed lines 33-34 from:
Time passes, and thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 ripple payment to Ryan." The credit relationship now is as follows:
to:
Time passes, and Thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 Ripple payment to Ryan." The credit relationship now is as follows:
Changed lines 38-40 from:
-$200 (from thomas's point of view)
+$200 (fromryan's point of view)
+$200 (from
to:
-$200 (from Thomas's point of view)
+$200 (from Ryan's point of view)
+$200 (from Ryan's point of view)
August 08, 2010, at 06:53 PM
by - Added an example
Added line 67:
%cframe width=1600px% %width=1550px%https://ripplexchange.com/images/diagrams/Ripple.png | '''An illustration of Ripple credit relationships'''
Added lines 1-66:
There is a basic explanation of the Credit Relationship concept at [[Definitions]].
In this extended example, we look at the accounting for a credit relationship as it evolves over time.
Ryan and Thomas represent two neighbor nodes that have a credit relationship with each other that has been registered with some ripple server.
Ryan has a 500 USD (U.S. Dollars) line of credit with Thomas, and Thomas has a 1,000 USD line of credit with Ryan.
Ryan wants to limit himself to going no more than $1,000 in debt with Thomas, and Thomas wants to limit himself to going no more than $5,000 in debt with Ryan.
So, for practical purposes, Ryan starts with $500 available credit from Thomas, and Thomas has $1,000 available credit with Ryan.
Initially, neither node has used any of its line of credit
Ryan-Thomas USD Credit Relationship
Ryan (values that Ryan can change)
Thomas's Credit Limit: 1,000
Ryan's Issuance Limit: 1,000 (could be set to, eg, 1 billion, if Ryan wants no issuance limit)
Thomas (values that Thomas can change)
Ryan's Credit Limit: 500
Thomas's Issuance Limit: 5000
Result:
Balance of Payments: 0
Ryan's Available Credit with Thomas: 500 (smaller of 500 and 1,000)
Thomas's Available Credit with Ryan: 1,000 (smaller of 1,000 and 5,000)
Time passes, and thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 ripple payment to Ryan." The credit relationship now is as follows:
Credit/Issuance Limits unchanged.
Balance of Payments:
-$200 (from thomas's point of view)
+$200 (from ryan's point of view)
Ryan's available credit with Thomas: 700 (smaller of (500+200) and 1,000)
Thomas's available credit with Ryan: 800 (smaller of (1000-200) and 5,000)
More time passes, and Thomas buys a bed from Ryan with a $700 ripple payment. The credit relationship now is as follows
Credit/Issuance Limits unchanged
Balance of Payments:
-900 (from Thomas's point of view)
+900 (from Ryan's point of view)
Ryan's available credit with Thomas: 1,000 (smaller of (500+900) and 1,000)
Thomas's available credit with Ryan: 100 (smaller of 1,000-900) and 5,000)
Ryan would now like to buy a laptop from Thomas, that Thomas is selling for $1,200.
Initially he can't do this because he set his own issuance limit at $1,000.
So, Ryan adjusts his issuance payment upward to $1,300 in order to make the payment. We now have
Ryan's available credit with Thomas: 1,300 (smaller of (500+900) and 1,300, the new issuance limit)
He then purchases the laptop for $1200, and we have
Result:
Balance of Payments:
+300 (from thomas's point of view)
-300 (from ryan's point of view)
Ryan's Available Credit with Thomas: 200 (smaller of 500-300 and 1,300)
Thomas's Available Credit with Ryan: 1,300 (smaller of 1,000 + 300 and 5,000)
In this extended example, we look at the accounting for a credit relationship as it evolves over time.
Ryan and Thomas represent two neighbor nodes that have a credit relationship with each other that has been registered with some ripple server.
Ryan has a 500 USD (U.S. Dollars) line of credit with Thomas, and Thomas has a 1,000 USD line of credit with Ryan.
Ryan wants to limit himself to going no more than $1,000 in debt with Thomas, and Thomas wants to limit himself to going no more than $5,000 in debt with Ryan.
So, for practical purposes, Ryan starts with $500 available credit from Thomas, and Thomas has $1,000 available credit with Ryan.
Initially, neither node has used any of its line of credit
Ryan-Thomas USD Credit Relationship
Ryan (values that Ryan can change)
Thomas's Credit Limit: 1,000
Ryan's Issuance Limit: 1,000 (could be set to, eg, 1 billion, if Ryan wants no issuance limit)
Thomas (values that Thomas can change)
Ryan's Credit Limit: 500
Thomas's Issuance Limit: 5000
Result:
Balance of Payments: 0
Ryan's Available Credit with Thomas: 500 (smaller of 500 and 1,000)
Thomas's Available Credit with Ryan: 1,000 (smaller of 1,000 and 5,000)
Time passes, and thomas uses $200 of his available credit with Ryan to purchase a guitar -- which means the same thing as "Thomas makes a $200 ripple payment to Ryan." The credit relationship now is as follows:
Credit/Issuance Limits unchanged.
Balance of Payments:
-$200 (from thomas's point of view)
+$200 (from ryan's point of view)
Ryan's available credit with Thomas: 700 (smaller of (500+200) and 1,000)
Thomas's available credit with Ryan: 800 (smaller of (1000-200) and 5,000)
More time passes, and Thomas buys a bed from Ryan with a $700 ripple payment. The credit relationship now is as follows
Credit/Issuance Limits unchanged
Balance of Payments:
-900 (from Thomas's point of view)
+900 (from Ryan's point of view)
Ryan's available credit with Thomas: 1,000 (smaller of (500+900) and 1,000)
Thomas's available credit with Ryan: 100 (smaller of 1,000-900) and 5,000)
Ryan would now like to buy a laptop from Thomas, that Thomas is selling for $1,200.
Initially he can't do this because he set his own issuance limit at $1,000.
So, Ryan adjusts his issuance payment upward to $1,300 in order to make the payment. We now have
Ryan's available credit with Thomas: 1,300 (smaller of (500+900) and 1,300, the new issuance limit)
He then purchases the laptop for $1200, and we have
Result:
Balance of Payments:
+300 (from thomas's point of view)
-300 (from ryan's point of view)
Ryan's Available Credit with Thomas: 200 (smaller of 500-300 and 1,300)
Thomas's Available Credit with Ryan: 1,300 (smaller of 1,000 + 300 and 5,000)