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Interledger @ Boston Layer 2 Summit

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Interledger is a Layer 3 protocol that connects Layer 2 networks like Lightning, Raiden, and other blockchain scaling solutions. This presentation gives an overview of the need for interoperability, how Interledger works, the parallels with the Internet, and use cases for streaming micropayments.

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Interledger @ Boston Layer 2 Summit

  1. 1. Interledger L2, L3, and Beyond Evan Schwartz Co-Inventor of Interledger @_emschwartz
  2. 2. Barriers to Blockchain Adoption: 1. Scalability 2. Interoperability
  3. 3. L2 Is a Hot Topic! ...And many more!
  4. 4. L2 Focuses on Scalability: ➔ Lower fees ➔ Faster transactions ➔ Higher throughput ➔ More users
  5. 5. Enabling New Use Cases
  6. 6. Enabling New Use Cases
  7. 7. How do we avoid this? Do you take Lightning? No, only Raiden
  8. 8. Barriers to Blockchain Adoption: 1. Scalability (ledger-specific) 2. Interoperability (ledger agnostic)
  9. 9. What if we could build network-agnostic (d)apps?
  10. 10. The Promise of Interoperable (Micro)Payment Networks I Lightning I Raiden
  11. 11. Internet of Money Payments Value Blockchains Coins
  12. 12. The Internet Works the Same Over Ethernet, Fiber, Radio
  13. 13. How do we connect different types of networks?
  14. 14. What if we copied the design of the Internet?
  15. 15. Interledger Internetworking for Money
  16. 16. Internet Architecture PPP ETHERNET WIFI BLUETOOTHL2: Network COPPER FIBER RADIOL1: (Physical)
  17. 17. Internet Architecture IP PPP ETHERNET WIFI BLUETOOTH L3: Internetwork L2: Network COPPER FIBER RADIOL1: (Physical)
  18. 18. Internet Architecture IP PPP ETHERNET WIFI BLUETOOTH L3: Internetwork L2: Network L4: Transport TCP UDP QUIC L5: Application HTTP SMTP NNTP NTP RTP COPPER FIBER RADIOL1: (Physical)
  19. 19. IP Requirements for Integration: ● Send data
  20. 20. IP Is So Network-Agnostic...
  21. 21. This is Why Protocols Designed for PDP-10s Work w/ iPhones
  22. 22. Interledger Architecture BLOCKCHAINS CENTRAL LEDGERSL1: Ledger
  23. 23. Interledger Architecture PAYMENT / STATE CHANNELS SIDECHAINS ... L2 Network BLOCKCHAINS CENTRAL LEDGERSL1: Ledger
  24. 24. Interledger Architecture ILP PAYMENT / STATE CHANNELS SIDECHAINS ... L3: Interledger L2 Network BLOCKCHAINS CENTRAL LEDGERSL1: Ledger
  25. 25. Interledger Architecture ILP PAYMENT / STATE CHANNELS SIDECHAINS ... L3: Interledger L2 Network L4: Transport IPR PSK STREAM BLOCKCHAINS CENTRAL LEDGERSL1: Ledger
  26. 26. Interledger Architecture ILP PAYMENT / STATE CHANNELS SIDECHAINS ... L3: Interledger L2 Network L4: Transport IPR PSK STREAM L5: Application SPSP HTTP-ILP PAYTORRENT BLOCKCHAINS CENTRAL LEDGERSL1: Ledger
  27. 27. Connectors Route Payments Across Ledgers Connector BTC USD
  28. 28. Connectors Generate Revenue From Spreads Alice 0.01 Chloe 0 Chloe 100 Bob 0 BTC USD
  29. 29. ILP Packets Can Be Sent Across Any Number of Hops BTC EUR RDNUSD
  30. 30. ILP Requirements for Integration: ● Send data (you can use IP) ● Send money
  31. 31. Interledger.js Uses Plugins to Abstract Different Ledgers & L2s
  32. 32. Current Plugins: ● XRP PayChan ● BTC Lightning ● ETH, ERC20 (Machinomy) Help us build more!
  33. 33. How much can we copy from the IPv4 packet?
  34. 34. We cut out many IPv4 fields
  35. 35. ILPv4 Packet (Prepare)
  36. 36. ILPv4 Packet (Fulfill + Reject)
  37. 37. Main Difference from IP: Packet loss is unacceptable with money
  38. 38. Optimistic Execution (Correspondent Banking Today) EXECUTE
  39. 39. Optimistic Execution (Correspondent Banking Today) FAIL
  40. 40. 1. PREPARE 2. EXECUTE Two-Phase Execution Secures Multi-Hop Transfers REFERENCES J. Poon and T. Drya, The Bitcoin Lightning Network: Scalable Off-Chain Instant Payments, 2015 S. Thomas and E. Schwartz, A Protocol for Interledger Payments, 2015
  41. 41. How similar are IP and ILP?
  42. 42. Copying QUIC Onto ILP
  43. 43. What network-agnostic (d)apps can we build?
  44. 44. INTERNET OF VALUE ILDeathmatch: Pay to Respawn, Winner Takes All
  45. 45. DEMO Watching video with streaming micropayments
  46. 46. INTERNET OF VALUE End of Ads and Surveillance-as-a-Service? Source: Matthew Henry on Unsplash
  47. 47. INTERNET OF VALUE Signup-Less Services
  48. 48. INTERNET OF VALUE Payments With Any Asset, Exchanged in Real Time Source: AWOL
  49. 49. INTERNET OF VALUE LASERBEER (Streaming Payments for Streaming Goods)
  50. 50. Interledger Project Invented at Ripple, Developed as a Standalone Open Project Open Protocol Community Group @ W3C 300+ Contributors Banks Central banks Payments companies Tech giants Consulting companies Blockchain companies
  51. 51. Join us for the hackathon! ● Create plugins for other L2s ● Build streaming payment apps
  52. 52. BlockchainBanks Mobile Money Online Wallets What will you build on the Internet of Value? interledger.org @interledger Next Boston Interledger Meetup on Tuesday 5/22: Interledger Protocol Stack Deep Dive

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