Interledger Workshop Berlin (1 June 2017)

1. Interledger Berlin - 1 & 2 June 2017

2. Live Stream: https://bluejeans.com/795795755 Tweet @interledger or use the hashtag #interledger Breakfast, afternoon tea provided both days Lunch in the hotel/expo

3. 09:30 - 10:00 An Interledger Overview 10:00 - 10:45 KEYNOTE: How micropayments will change the world 10:45 - 11:00 Coffee/Tea break 11:00 - 12:30 Building the live Interledger network with ILP Kit and Connector.land 12:30 - 13:30 Lunch 13:30 - 13:45 A walkthrough of the Interledger Java implementation 13:45 - 14:15 DEMO: Ledger plugins and existing integrations 14:15 - 14:45 DEMO: Gatehub ledger plugins and APIs 14:45 - 15:00 Interledger and the W3C Web Payments APIs 15:00 - 15:15 Crypto-conditions 15:15 - 15:30 Coffee/Tea break 15:30 - 16:00 PANEL: Interledger routing challenges 16:00 - Close Planning for day 2 Agenda For Today (1 June)

4. Interledger Project KEY FACTS Open Protocol Community Group @ W3C 220+ Contributors Banks Central banks Payments companies Tech giants Consulting companies Blockchain companies

5. October 2015 Published the Interledger White Paper November 2015 Launched Interledger Community Group at W3C February 2016 First workshop in San Francisco (50+ attendees) February 2016 First draft of Crypto-conditions RFC March 2016 First draft of Architecture Overview (ILP - RFC 1) June 2016 Re-launch of interledger.org website July 2016 Second workshop in London (70+ attendees) July 2016 IETF Berlin - BoF session September 2017 W3C TPAC Lisbon - ILP Community Group meeting October 2017 InterledgerJS launched at the JS Foundation November 2017 ILP Kit v1 released March 2017 ILP Address and Packet specs released May 2017 ILP Kit v2 released June 2017 Third workshop in Berlin A Little History

6. 6 Interledger Workshop LONDON 2016

7. Interledger Evan Schwartz @_emschwartz Internetworking for Money

8. Payments are broken.

9. Payment Methods Accepted By Prineta.com Accepting Payments OnlineAccepting Payments Online

10. Blockchain will not solve the problem.

11. Payment Networks Are Disconnected BlockchainBanks Mobile Money Online Wallets

12. We Need the Internet of Money Payments Value Blockchains Coins

13. Can We Connect Everything to One Blockchain? ? ? ? ?

14. No.

15. The World Will Never Agree On One Ledger

16. We Need the Internet of Money Payments Value Blockchains Coins

17. internetworking

18. in·ter·net·work·ing Connecting networks through gateways that route data packets between the networks noun

19. Internetworking Connects Everyone

20. BlockchainBanks Mobile Money Online Wallets Internetworking For Payment Networks

21. Interledger Internetworking for Money

22. OUR INSPIRATION The History & Architecture of the Internet

23. SIMPLICITY

24. Internet Architecture IP WIFI BLUETOOTH ETHERNET Internetwork Network Transport TCP UDP Application HTTP SMTP NNTP NTP RTP

25. Interledger Architecture ILP BLOCKCHAINS BANKS MOBILE MONEY Interledger Ledger Transport IPR PSK PSK-ECDH Application SPSP HTTP-ILP PAYTORRENT

26. Interledger 101

27. Internetworking Ingredients: 1. Ledger Abstraction 2. Routers 3. Multi-Hop 4. Address + Packet 5. Routing

29. BlockchainBanks Mobile Money Online Wallets Need a Way to Interact with Every Kind of Ledger

30. All Ledgers Are Treated Equally

31. IP Works Over Every Type of Network

32. Stay Tuned for More on Ledger Plugins: 1. Demo Today @ 2pm 2. Plugin-athon Tomorrow

34. Payments Within One Network Are Trivial Sender ReceiverLedger

35. Payments Across Ledgers Sender ReceiverLedger Ledger ?

36. Connectors Link Two Ledgers Connector EUR USD

37. Connectors Exchange Currencies Alice 100 Chloe 0 Chloe 107 Bob 0 EUR USD

38. Connectors Generate Revenue from Spreads Alice 100 Chloe 0 Chloe 107 Bob 0 EUR USD

39. Payments Across Connectors? EUR USD ? BTC

41. Multi-hop is trickier with money than with data

42. Correspondent Banking: Optimistic Execution EXECUTE

43. Correspondent Banking: Optimistic Execution FAIL

44. 1. PREPARE Interledger: 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

45. 1. PREPARE 2. EXECUTE Interledger: 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

46. Conditional payments enable trustless connectors

47. 1. PREPARE 2. EXECUTE Sender is Guaranteed Fulfillment or Money Back 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

48. Interledger works even over simple payment channels

50. { account: "g.us.usd.chase.bob.car", amount: "10", data: "SGVsbG8gV29ybGQhCg..." } Interledger In One Slide

51. { account: "g.crypto.bitcoin.1BvBMSEY...", amount: "10", data: "SGVsbG8gV29ybGQhCg..." } Interledger Addresses Work for Any Ledger

52. Core of IP is the Address and Packet Formats

54. Addressing is Separate From Routing Please deliver to g.crypto.bitcoin.1x... Right away!

55. Interested in Routing? Come to the Routing Discussion @ 3:30pm

57. Internet of Value

58. Interledger Internetworking for Money

59. Micropayments Stefan Thomas @justmoon Small Payments Make a Big Difference

60. The Internet Economy is Incomplete 10010110 ??? DOWNLOADER UPLOADER Today: Protocols Suffer from the Barter Problem

61. Coincidence of Wants There may be many people wanting, and many possessing those things wanted; but to allow of an act of barter, there must be a double coincidence, which will rarely happen. - William S. Jevons, 1875 “

62. So We Use Hacks to Get Around the Problem 10010110 DOWNLOADER UPLOADER $$$ Hacks: Aggregation, Bartering, Bundling, ...

63. Why Are You Getting 30% of Everyone's Revenue, Exactly? Aggregation: Explosion of Marketplaces

64. Tim Cook, CEO Apple When an online service is free, you're not the customer. You're the product.

65. Bundling: Annoying and Dangerous 66

66. Users Are Opting Out Source: PageFair/Adobe Ad Blockers Rising

67. Peer to Peer Model

68. $$$ 10010110 DOWNLOADER UPLOADER Money: Solving the Barter Problem Since 5000 BC Money Solves the Barter Problem

69. Everywhere you want to be. There are some things money can't buy. For everything else, there's MasterCard. TODAY Payment Networks Compete For Reach

70. This used to be true for information networks too

71. "… biggest …" "… more members …" "… more services…"

72. Internetworking commoditized reach

73. America's fastest Internet. Reliable. Safe. Fast. High-speed Internet from AT&T Fast, reliable, unlimited Internet WITH INTERNETWORKING Providers Compete on Speed, Reliability, Ease-of-use

74. Sending Payment... $1241.20 remaining; current speed: 13.2 $/s

75. Efficient Switching Removes Fixed Costs unviable viable viable fixed cost Transaction size Cost Transaction size Cost pre-internetworking fixed costs price out long-tail use cases post-internetworking new business models become possible

76. The Internet Enabled Fundamentally New Business Models

77. Internet — Cost vs Volume SOURCES Cisco DrPeering

78. $$$ Large (>10$), Slow (several seconds), Few in Number Today: Humans Pay for Goods and Services 2017

79. $$$ Payments in 2021: 100x Cheaper, 100x Smaller, but a Billion Times More Volume Future: Humans Pay for Goods and Services $$$ 10010110 2017 2021

80. We will move from mobile-first to AI-first. Sundar Pichai, CEO Google

81. 87

82. This Applies to Everything Data is Transforming Every Industry and This Will Transform Data ● Artificial Intelligence ● Virtual Reality ● Drones ● Internet of Things ● Self-Driving Cars ● Mobile ● World Wide Web ● Stocks Get Paid for Submitting Training Data Pay for Premium Content Experience Pay for Recharging Devices Providing Services to Each Other Trade Road Data; Pay for Transit Priority Disrupt App Marketplaces Gain a Sustainable Business Model Settle Trades Across Exchanges

83. Advertising and Marketplaces May Become Outdated Models The Disrupter Becomes the Disruptee 1995-2016 2017- ?

84. Nodes and Links Michiel de Jong @michielbdejong On the Open Interledger

85. Part 1: Nodes on the Interledger

86. The first nodes: FiveBellsLedger

87. The first nodes: FiveBellsLedger + ilp-connector

88. The first nodes: FiveBellsLedger + Ilp-connector + PluginVirtual

89. FiveBellsLedger is great for Dial-up Nodes

90. Ilp-kit servers have become Personal Nodes

91. Connectors are the links between Ledgers

92. Connectors are the links between Ledgers FiveBellsLedger FiveBellsLedger Connector Connector Plugin Virtual Plugin Virtual

93. Connectors are the links between Ledgers FiveBellsLedger FiveBellsLedger Connector Connector Plugin Virtual Plugin Virtual

94. Spring 2017: The Interledger Enlightenment

95. Connectors are the links between Ledgers Ledgers Connectors

96. Ledgers are the links between Connectors FiveBellsLedger FiveBellsLedger Connector Connector Plugin Virtual Plugin Virtual

97. Ledgers are the links between Connectors FiveBellsLedger FiveBellsLedger Connector Connector PEER LEDGER

98. ilp-kit: Reference Node Changes often Personal Server Version 2 live Version 3 dev

99. ilp-kit is like Lego

100. Other Software: Java (progress!) ilp-node (early)

101. Plugin land: LPI spec Peer ledgers Group ledgers Crypto ledgers

102. PluginVirtual: Each node’s API Node-to-Node RPC calls

103. Core Node Keep a full routing table

104. Periphery Node Ask upstream for a quote

105. Node functions: Receive a route Forward transfer Pass fulfillment Respond quote Balance check Pass rejection Fulfill SPSP Initiate payment

106. Server Hardening Fend off unauthenticated requests Detect peer gone nasty, and unpeer Blame sender or receiver?

107. ConnectorLand Stats about personal nodes A bit behind on its Q2 schedule! Crypto Crypto Crypto Crypto Personal Personal Personal Personal

108. Part 2: Links on the Interledger

109. Who do you trust? Each inbound peer vouches for its predecessors Each outbound peer vouches for its successors

110. Which ledger is inside your node? Destination ledger for spsp Hot wallets

111. Which ledger is between two nodes? Trustline Payment channel

112. How do nodes communicate? Prepare fulfill reject Routes Curves Quotes On-ledger Separate Comms networks Using hubs

113. How does a Link work? Limits Disputed balance In-flight amount Closing a ledger-backed channel Proxying ledgers Hashlocks inside payment channels

114. Ledger Plugins Ben Sharafian @sharafian Elements of Interledger

115. Public Blockchains Xe Et B Z

116. Et Plugin Ethereum Public Blockchains Basic Ethereum integration

117. Xe Plugin XRP Public Blockchains Using Escrow functionality on the XRP Ledger

118. Central Ledgers Fb Gh Pp Ap

119. Gh Plugin Gatehub Central Ledger You'll hear more about this in a moment!

120. Simple Channels V Xp Ep Bp

121. V Plugin Virtual Basic Channels Simplest possible ledger

122. Xp XRP PayChan Basic Channels Only in-flight funds are at risk

123. Et XeEthereum (Escrow) XRP (Escrow) Lo' and Behold: Payment History May 16, 2017

124. Fb Five Bells Demonstrating Interledger

125. Fb V Five Bells Virtual

126. Fb V Et Five Bells Ethereum (Escrow) Virtual

127. Fb V Et Xp Five Bells Ethereum (Escrow) Virtual XRP (PayChan)

128. Fb V Et Xp Ch Five Bells Ethereum (Escrow) Virtual XRP (PayChan) Chain

129. Fb V Et Xp Ch Five Bells Ethereum (Escrow) Virtual XRP (PayChan) Chain

130. V Et Xp Ch Bp Ethereum (Escrow) Virtual XRP (PayChan) Chain Bitcoin (Payment Channels)

131. V Et Xp Ch Bp Xe Ethereum (Escrow) Virtual XRP (PayChan) Chain XRP (Escrow) Bitcoin (Payment Channels)

132. LET'S WATCH THE REACTION!

133. Simple Channels V Xp Ep Bp

134. State Channels V Xp Ep Bp Xb R Li

135. Central Ledgers V Xp Ep Bp Xb R Li Fb Gh Pp Ap

136. Private Blockchains V Xp Ep Bp Xb R Li Fb Gh Pp Ap Ch H

137. Public Blockchains V Xp Xb Ch Et Xe Ep R H B Bp Li Fb Gh Pp Ap Z

138. Periodic Table of Ledgers V Xp Xb Ch Et Xe Ep R H B Bp Li Fb Gh Pp Ap Z

139. Help Us Fill In The Blanks! V Xp Xb Ch Et Xe Ep R H B Bp Li Fb Gh Pp Ap Z

140. W3C Web Payments Interledger in the browser Adrian Hope-Bailie @ahopebailie

141. A payment API built into the browser 147 const methodData = [{ supportedMethods: ["basic-card"], data: { supportedNetworks: ["visa", "mastercard"] } }, { supportedMethods: ["interledger"], data: { spspEndpoint: "http://example.com/spsp/?invoice=1234" } }]; const payment = new PaymentRequest(methodData, details, options); let paymentResponse; paymentResponse = await payment.show(); validateResponse(paymentResponse); paymentResponse.complete("success");

142. What does it look like 148

143. ● Payment Request - https://www.w3.org/TR/payment-request/ ● Payment Method Identifiers - https://w3c.github.io/webpayments-method-identifiers/ ● Payment Handler - https://w3c.github.io/payment-handler/ ● Payment Methods Basic Card - https://w3c.github.io/webpayments-methods-card/ Interledger - https://w3c.github.io/webpayments/proposals/interledger-payment-method.html Tokenized Card - Credit Transfers - https://w3c.github.io/webpayments-methods-credit-transfer-direct-debit/ Specifications

144. Who’s involved 150