This presentation from the Boston Interledger Meetup goes into the technical details of the Interledger architecture. It describes how ILP integrates with different ledgers and Layer 2 networks, how ILPv4 works, and what the Transport and Application Layer protocols built on top of ILP look like.

1. Interledger
Protocol Stack Deep Dive
Evan Schwartz
Co-Inventor of Interledger
@_emschwartz

2. Agenda 1. Internetworking Architecture
2. Ledger Integrations: HTLCs vs HTLAs
3. Interledger Protocol V4
4. Building on ILP: Transport & Application

3. Internet of
Money
Payments
Value
Blockchains
Coins

4. The Internet Works the Same Over Ethernet, Fiber, Radio

5. IP Is So Network-Agnostic...

6. This is Why Protocols Designed for PDP-10s Work w/ iPhones

7. 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 RADIO(L1: Physical)

8. Interledger Architecture
ILP
PAYMENT / STATE CHANNELS
SIDECHAINS ...
L3: Interledger
L2 Network
L4: Transport IPR PSK STREAM
L5: Application SPSP HTTP-ILP PAYTORRENT
BLOCKCHAINS CENTRAL LEDGERS(L1: Ledger)

9. Background
Why layered protocol stacks?

10. Balancing Interoperability and Innovation
More
Standardization
More
Flexibility

11. 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 RADIO(L1: Physical)

12. What features belong in each layer?
?
?
L3: Interledger
L2 Network
L4: Transport ?
L5: Application ?
?(L1: Ledger)

13. What interfaces should each layer provide to the others?
?
?
L3: Interledger
L2 Network
L4: Transport
?
L5: Application
?
(L1: Ledger)

14. Background
Securing multi-hop payments

15. Optimistic Execution (Correspondent Banking Today)
EXECUTE

16. Optimistic Execution (Correspondent Banking Today)
FAIL

17. 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

18. 1. PREPARE
Sender Cannot Lose Money If Packet Is Dropped

19. 1. PREPARE
2. EXECUTE
Malicious Intermediaries Lose Funds If Response Is Dropped

20. Background
HTLCs vs HTLAs

21. Hashed Timelock Contract (HTLC): Ledger-Mediated

22. What if the ledger is too slow, expensive, or no HTLCs?

23. Hashed Timelock Agreements (HTLA) Are Purely P2P

24. HTLA: No Preimage → No Money

25. HTLA: Preimage → Money

26. HTLA: Preimage, No Money → No Future Business

27. HTLAs: Prepare, Fulfill, Settle, Repeat

28. What features are needed from
ledgers (or Layer 2 networks)?

29. Layers 1 + 2
Ledger Integrations

30. There are a lot of blockchains out there!

31. Layer 2 Is a Hot Topic!
...And many more!

32. The Traditional Payment Space is Already Highly Fragmented

33. What features are common to
all payment networks?
What features can we expect?

34. Interledger.js Uses Plugins to Abstract Different Ledgers + L2s

35. Core Ledger Functions
● Send money
● Send data

36. Sending Data: BTP Uses Websockets for Secure P2P Comms

37. BTP 2.0 Is A Binary Request/Response Protocol

38. Sending Money: Settling HTLAs
?

39. What if the ledger is too slow or expensive?

40. Payment Channels Enable Fast, Free Settlement for HTLAs

41. XRP Ledger Payment Channels

42. Machinomy Library for ETH + ERC20 Payment Channels

43. Lightning Payments Used on Bitcoin

44. Payment channel plugins extend
ilp-plugin-btp and
ilp-plugin-mini-accounts

45. Plugins for on-ledger settlement
extend ilp-plugin-payment

46. Layer 1 + 2 Must-Haves:
● Send data
● Send money
Layer 1 + 2 Nice-To-Haves:
● Fast, Cheap Transfers OR
● (Unidirectional) Payment Channels
● Native Comms / Authentication

47. Layer 3
Interledger Protocol V4 (ILPv4)

49. ILPv4 Packet (Request)

50. ILPv4 Packet (Response, Error)

51. Example ILP Prepare Packet
{
"amount": "1000",
"executionCondition":
"3c36339587dbd93a815168c14478afcf3dcf77559c9ff0ca425b53317f32d56e",
"expiresAt": "2018-05-22T19:41:20.724Z",
"destination":
"test.amundsen.bmp.btp18q1xrp.DZ3ec1t1idUwmt7e2uU82mUkmT2pKodAq-PRm4SoNlc.lo
cal.0ttqOHeL_k9Hkdac-XFv4uyy-a3_Q6jbteIVU68ZIyY.ZQzhSKrtxjm10yuJQixQ9vct",
"data":
"a8bbf14d8331429627142fc19ad2e69ef7f3b45d576577ddd1027ec7ed43205e25ef6ff68a
76d2d26e6a7572cf5a7bc09952bfb7067d29f8edea1f17d42e41f36d1c4466b9d3f17cd54a
91ed55a0830702a36290ddad05e7bf41c5d61cac8ce9621e9f59a1dae637d23fcc1e648a99
497707d6a4a1ee85bb78a6b20550d9b99a9b14b9d4f51602c2bfacf9533a6d4c2c819faa6b
77d2592fc7dd75c5e522795e0f"
}

52. Example ILP Fulfill Packet
{
"fulfillment":
"c076b41108fa77c54a447e708f34c6d8114caec0b5a11df70ee31bcd99a4cb46",
"data":
"3f7cc52c5e93bbe6fd35571736c1089c0863fbfa21e6dbc945b4da7b077fde71c5d688c554
ae39226d7df7dde92c33d389335d09c4e1ea1ce3b9fe5a9a18275bc47c9c1cd0d30ea8403d
"
}

53. Example ILP Reject Packet
{
"code": "F99",
"triggeredBy":
"test.amundsen.bmp.btp18q1xrp.DZ3ec1t1idUwmt7e2uU82mUkmT2pKodAq-PRm4SoNlc.lo
cal.0ttqOHeL_k9Hkdac-XFv4uyy-a3_Q6jbteIVU68ZIyY",
"message": "",
"data":
"9e43eb8120564d3da393f80cc24d7f20b3144381c4d3cbc6c0679ab8b39fcba4b484fc50a0
497e24e2fb87e77ceb"
}

54. ILP Addresses Are Hierarchical, Dot-Separated Strings

55. Questions Answered to Arrive At ILPv4
● Crypto Conditions or SHA-256?
● Are conditions a ledger or Interledger concern?
● Address separator: dots, dashes, colons, >’s?
● Should packet include source address, options, QoS?
● Should packet include destination amount?
● Do we need a separate quoting protocol (ILQP?)
...and many more

56. Four People Spent A Full Day Debating Address Separators

57. ILPv4 is (arguably) the
simplest possible protocol for
internetworking value networks

58. Layer 4
Transport

59. 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 RADIO(L1: Physical)

60. Transport layer provides
helpful functionality
needed by many applications

61. 1st Gen: Receiver-Generated Fulfillments

62. 2nd Gen: Sender-Generated Fulfillments

63. 3rd Gen: In-Protocol Quoting

64. 4th Gen: Quoting and Streaming

65. STREAM Client and Server Communicate Over ILP
Client Server
Interledger

66. STREAM Handles Bi-Directional Sending
Client Server

67. STREAM Connections Consist of Multiple Logical Streams

68. STREAM Features

69. STREAM Packets Are Opaque to Intermediaries

70. STREAM Packets Are Composed of a Header + Frames

71. Layer 5
Application

72. Application layer has
undergone many iterations but
more work to do using STREAM

73. Previously, Application Layer
just meant connection setup

74. Application Layer Protocols To-Date
● Simple Payment Setup Protocol
● HTTP-ILP
● Codius Cog
● Web Monetization

75. Resolving Human-Readable IDs to ILP Addresses

76. Application Layer Features
● Connection setup (TLS over ILP?)
● Requests for payment?
● Pull payments (using tokens)?
● Signed receipts?
● HTTP over ILP?
(Get involved in this development!)

77. BlockchainBanks Mobile Money Online Wallets
Help shape the Interledger architecture!
interledger.org @interledger