Libra/JPMorgan/MakerDAO - stable EuroToken

[synctext]

Based on our work finished in 2017: Real-time Money Routing by Trusting Strangers with your Funds

• basket of coins (Simple fixed rate to start: 1 dollar, 1 pound, 3 Euro)
• multiple legal regimes
• independence for default risks
• no central bottleneck, no single legal entity
• full reserve
• Decentral exchange platform for basket of coins
• exchange rate based on a combination of assets
• asset manager traditionally determines the asset combination, based on exchange rate.
• Notary accounts for buy-in

[synctext]

Stable Coin Survey - literature survey

Pension Fund APG should be able to use our infrastructure for pension-transfer and other uses. Keep it simple: focus on single currency. Euro-token.

Related work: Digital Currencies and Fast Payment Systems: Disruption is Coming - Darrell Duffie from Stanford. Central bank digital currencies - Bank for International Settlements. Fedcoin by R3. Proper theory: https://www.sciencedirect.com/science/article/pii/S0167739X18300475

Scope: preparation for a thesis on stable coins, usable in the real-world. Stability through fiat currency like Euro or fancy MakerDAO contraptions. Boring and truly stable is a plus. Blockchain as a legal authoritative ownership tracking of Euros on a full-reserve bank account. Netting and clearing between participants. Real-time Euro-token transfer. System model: an secure overlay for legacy bank accounts. Questions:

• how to eliminate default risk (e.g. JPMorgan goes bankrupt)
• provide strongest possible legal certainty
• design space:
  • a single central collateral bank account
  • multiple collateral bank accounts
  • Each participant has a single collateral bank account
  • Each participant has multiple collateral bank accounts
• avoid single legal zone: spread out over the globe, beyond Euro-zone?

Ambition level: preparation for a thesis with real a money test.

[synctext]

Real world happenings:

• https://cointelegraph.com/news/eu-and-libra-facebooks-project-getts-challenged-as-eurocoin-looms
• https://www.coindesk.com/a-loan-shark-situation-makerdao-is-leaving-crypto-borrowers-with-rising-bills-and-theyre-crying-foul
• https://www.foxbusiness.com/technology/trump-libra-facebook-cryptocurrency-regulation
• many stable hypecoins https://defiprime.com/stablecoins
  • trust these white papers
  • trust the system and architecture (MakerDAO)
• literature survey writeup:
  • beyond traditional listing (system1,system2,system3,...)
  • more scientific angle: discuss each key design decision and classes-of-systems (casually mention concrete stable coin projects)
• You could do a deep-dive into Libra, like we did for Filecoin
• Next meet: 40+ papers read, post list of sources on this issue, section structure draft

[rwblokzijl]

Financial Derivatives on the Blockchain or How to Stabilise a Crypto Currency - A Literature Survey

Introduction

General Theory and Background

Centralised Stablecoins

Theory

Fedcoin_Central_Bank_R3.pdf

Examples

Pegged by reputation

JPMorgan Coin
JP Morgan backed, aim to provide fast inter-organisation value transfer

Libra
Not pegged, or backed

Pegged by currency reserves

Centre
fiat pegged, multiple holders/issuers (exchanges)

Gemini
Centralised reserves, fiat backed by bank, approved by New York State Department
of Financial Services, run by exchange,

PAXos
Centralised reserves, fully collatoralised, approved by New York State
Department of Financial Services

Tether
Largest stablecoin right now, centralised reserves, 1 escrow account,
controversial because of autiting funny business

TrueUSD
Multiple escrow, audit by third party, used to be 2nd largest coin

Stasis
Company that tokenises assets, Euro stablecoin as a first product, Network of
liqudity providers, focus on regulation, live since december 2018,

stably
Multiple escrow, audits, FDIC-insured

Pegged by assets

DigixDAO
DAO, gold pegged coin, central storage of gold

globcoin
Made by an Asset Management Company, Diversified reserve of 15 currencies,
basically a token for a "basket of global currencies"

x8currency
Token that tracks 7 currencies and gold.

Pegged by other centralised stablecoins

Reserve
Centralised governance with "promise" of decentralisation, collateral using
USDC, TUSD, PAX, backed by big names, launches q3 2019, only "Reserve Rights"
(governance token) are on the market as of now

Decentralised Stablecoins

Collateralised

Dependencies

Chainlink oracle

Development over time

BitShares
bitusd is a token for speculating on bitshares uses CDP like structure

MakerDAO
DAO, pegged to dollar, CDP accepting ether, plans to add Digix gold CDPs, gets
margin called when under collatoralsed, governance token is printed and sold as
last resort

Havven
generalises stablecoin to tracking of offchain trackers, now synthetix, hold
singe collatoral pool of "SNX", allows exchanes between any tracked asset

Domain Specific

Steem dollar
Steem-dollars are used for storing proceeds on the steemit network, redeemable
for 1 dollar worth of newly minted STEEM with a weeks delay |

Algorithmic

Theory

How to make a digital currency on a blockchain stable

• Argues that the way newly created currency is unlinked to the supply and
  demand leads to uneccessary instability.

• Mining rate increases and decreases with demand and thus price
  • Mining reward should go up when mining rate increases
  • Mining reward should go down when mining rate decreases.
  • This is done by not resetting the block time to 10 minutes unless a
    minimum/maximum threshold is reached.
  • When the threshold blocktime is reached the reward for the block should
    simply be scaled with the mining difficulty.
• The author also suggests no halving in mining reward
• To cull inflation the author suggests a mechanism for deflation
  • every 100 blocks all bitcoins are depreciated in value by deleting a
    percentage of them

Practice

Nubits
First Stablecoin to be stable for a year, incetivises holders to park currency
during low demand, Democratic DAO, failed after a demand shock in 2016,
recovered, failed again, never recovered again |

Ampleforth
Formerly fragments, Scales existing coins in place to make 1 equal to a dollar,
rebase happens at most every 24 hours

Anchor
Pegs to "Global Economic Growth" with MMU oracle (Monetary Measurement Unit).
Uses Seigniorage Shares Model

Basis
decentralised, defunct, brings up interesting faults of makerdao and bitshares
was based on Seigniorage Shares Model

BitBay
peg needed for trading platform, maintains rollong peg by freezing users coins

General theory

Are Stable Coins Stable?
DuffieDigital and Fast Payment Systems
Money as IOUs in Social Trust Networks
Can We Stabilize the Price of a Cryptocurrency?: Understanding the Design of Bitcoin and Its Potential to Compete with Central Bank Money
TrustChain
THE STATE OF STABLECOINS
Stablecoins in Cryptoeconomics. From Initial Coin Offerings (ICOs) to Central Bank Digital Currencies (CBDCs)
Stablecoin: Yet Another Layer of Cryptocurrency Complexity
(In)stability for the Blockchain: Deleveraging Spirals and Stablecoin Attacks
Elasticoin: Low-Volatility PoSW
Designing Stable Coins

Coins to investigate

minex
carbon
augmint
AuroraDAO

[synctext]

Little (1 page) intro on foundations of money (e.g. read https://core.ac.uk/download/pdf/6252203.pdf)
1844 private money creation ban: https://en.wikipedia.org/wiki/Bank_Charter_Act_1844

Add buying these coins and selling them again, market liquidity problem?

[rwblokzijl]

Current progress

TODO:

• Write history of money, value and pegs
• convert notes into nice text for chapter 5 and 6
• Discussion, conclusion, abstract

Estimated time needed 1 week

[synctext]

10week Survey Progress: 4 pages, 40 citations!

non-paywall paper: https://repository.tudelft.nl/islandora/object/uuid:c51ac99d-3013-44b3-8ddd-fbd951a2454a/datastream/OBJ/download
1st line intro stuff: stable coins are a promise to offer all the advantages of the digital world, while being as reliable as a briefcase of 500 Euro notes. (easy on the content, easy to read, easy to understand)
Page 1 intro picture
Note # 4863 on "DelftDAO" brainstorm (subject to change, like DarkNetDAO/s :-) ).
https://www.google.nl/search?q=literature+overview+table
Stable coins and the law? out-of-scope?
"As of the writing this survey,", suggestion: currently..
?? Dividing line: permissioned versus real permissionless + privacy (Monero level)
?? Bitshares; versus Regulation goes through the exchanges: buying and selling MUST use KYC and AMLD compliance
Overview picture like this shown in: https://arxiv.org/pdf/1906.06037.pdf

[synctext]

Big fraud paper: "Is Bitcoin Really Un-Tethered?"

This paper investigates whether Tether, a digital currency pegged to the U.S. dollar, influenced 
Bitcoin and other cryptocurrency prices during the 2017 boom. Using algorithms to analyze
blockchain data, we find that purchases with Tether are timed following market downturns and
result in sizable increases in Bitcoin prices. The flow is attributable to one entity, clusters below
round prices, induces asymmetric autocorrelations in Bitcoin, and suggests insufficient Tether
reserves before month-ends. Rather than demand from cash investors, these patterns are most
consistent with the supply-based hypothesis of unbacked digital money inflating cryptocurrency
prices.

[rwblokzijl]

Here is the first finished version.

paper.pdf

[synctext]

Blunt comments to make it better:
Principle, concept, and algorithms should be the cornerstone of the storytelling. It does not signal science when BitUSD has 19 occurrences in a text column without any illustrations. Please re-consider the 3 items in your title, try to determine scientific principles to focus on. Somehow it now has also a tutorial feeling, then a science feeling. Abstract away the specific of each system, focus on the cardinal principles... Leave out the right details. plus repeating above: https://www.google.nl/search?q=literature+overview+table

[synctext]

Discussion points:

• consider making the tone boring and solid:
  • Replace Tether with ECB and German bank club
  • Central bank digital currencies by European Central Bank
  • German bankenverband.de : crypto-based Euro
• systemic pegging risks:
  • first define term
  • counter-party risk around collateral
  • capacity limits, no operational layer 1 can support 22% of the world economy (e.g. The Euro)
  • then layer 1 attacks: transaction spam on Ethereum, each Tx costs $1000?
  • technical design flaw, current SHA1 end-of-life show what may happen
  • We discover other system risk in the architecture itself like pre-computation using Rainbow table
  • are crypto-pegged currencies as dangerous as sub-prime mortgages or can they be made safe?
  • During a financial crisis the evaporation of value in MakerDAO erodes all "Tier 1" capital. Instant correlated need for capital by all players in the pegged crypto market. "capital run". Explain this principle and give it a gloomy name: sub-prime cypto.
  • using a volatile crypto and an atomic swap to simulate a a stable currency is inherently unstable
  • @BloodyFool since the whole crypto industry is correlated and self-amplifying, they all go down together
  • the need for Tesla, Nike, thorium-ore, and Apple stock to de-correlate collateral
• thesis future direction brainstorm: EuroToken, DAO, and/or Trustchain

[devos50]

using a volatile crypto and an atomic swap to simulate a a stable currency is inherently unstable

Related work: On the optionality and fairness of Atomic Swaps (published in AFT'19).

[rwblokzijl]

I spent some time thinking about how double spending could be solved on permissionless networks using the FWSP. I think i came up with something:

Title ideas:

• Solving double spending on permissionless HyperSharded Blockchains
• Solving double spending by using continuously evolving witness sets to
  create a chain of custody.

Core idea:

• Double spending can be prevented by preventing forks of the local blockchain
• preventing forks can be done by enforcing a pointer to the last block
• enforcing a pointer can be solved by a maintaining a set of fairly selected
  witnesses store the last block hash
• maintaining a set of fair witnesses can be solved by incentivising account
  holder to monitor the set size and expanding the set when needed
• fairly selecting witnesses can be solved using the Fair Witness Selection
  Protocol

Protocol brainstorm:

• use FWSP to select witnesses for each account
  • witnesses store only the last block hash (or block)
• transact as follows:
  • sender creates a transaction block specifying:
    • amount transferred
    • updated account balance (so we don't need history)
  • sender provides all blocks, starting at the last stored hash, ending at the
    newly created block, to all witnesses:
  • witnesses then:
    • verify the subchain if:
      • the first block provided matches the stored hash
      • all transactions and account balances are valid
    • if the subchain is verified:
      • the stored hash is updated
      • a signature of the last block is returned to the sender
  • sender provides block and signatures to receiver who verifies the
    signatures and witness set
  • receiver can submit this block to its witness set, but if the witnes set
    can be verified after any period of time somehow, the blocks only have to be
    submitted during the spending of the transferred funds.
• avoid witness set degradation:
  • each account holder is responsible for "adding" new witnesses if their
    witness set degrades
    • if witness counts degrade below a certain level, this accounts
      transactions can no longer be accounted for and the account is "lost"
    • Witnesses could also find replacement when leaving, by punishment of
      losing a "stake"
  • a new witness must be provided a block hash that is verified by k other
    witnesses
  • this means that a witness set is degraded when the total witnesses online
    drops below k, but can be restored if they come back online

Further questions:

• What to do with lost funds on witness degradation?
• how are bad witnesses punished? stakes?
• sybil resistance?
• avoid half a transaction if the receiver drops their connection
  • transact only if both witness sets write?
• Minimum witness count?
  • For transaction
  • For adding new witnesses

Any obvious faults? Am i being naive? Any thoughts? @synctext @devos50 @inconspicuous-username @MattSkala

[rwblokzijl]

and here is an updated version of the stablecoin survey:
paper.pdf

I have added visuals and tables to aid in the explanation of the stablecoin mechanisms. I have also rewritten the 2 core chapters (centralised stablecoins, and decentralised stablecoins)

ToDo:

• Rewrite 1 Introduction
• Rewrite 2 Background
• Rewrite 5 Discussion
• Rewrite 6 Conclusion
• Cleanly insert references
• Properly format tables

[MattSkala]

If I understand FWSP correctly, then it requires you to keep a log of when each peer entered/left the network, so anyone can later verify that you selected the witnesses correctly according to the protocol. How exactly would you adapt this to a permissionless system where you don't know which peer joined/left the network at which time?

[devos50]

@BloodyFool I'm not sure how much added value your proposal would have. Double spending in TrustChain (more generally: chain integrity) is something that we already explored a few times (although it has never been properly scientific published). For example, see this recent master thesis.

I think PeerReview was one of the first systems to use witness selection and random auditing to prevent cheating. In fact, PeerReview and TrustChain share many similarities, in a sense that they both focus on the accounting of data elements in pair-wise ledgers. Recently, we wrote an article that I think address most of your bullet points. If you wish, I can send it to you, with the remark that it is confidential and under double-blind review.

If I understand FWSP correctly, then it requires you to keep a log of when each peer entered/left the network, so anyone can later verify that you selected the witnesses correctly according to the protocol. How exactly would you adapt this to a permissionless system where you don't know which peer joined/left the network at which time?

To do so, you need some kind of membership function where you can query the full set of nodes currently online. Churn makes this challenging. I think this is one of the main reasons why FWSP is designed around permissioned networks.

[inconspicuous-username]

And to add to the churn, FWSP can handle only up to 1/3 of nodes being online. With fleeting nodes this is a hard requirement to fullfill On 28 Jan 2020 09:50, Martijn de Vos <notifications@github.com> wrote: @BloodyFool<https://github.com/Bloodyfool> I'm not sure how much added value your proposal would have. Double spending in TrustChain (more generally: chain integrity) is something that we already explored a few times (although it has never been properly scientific published). For example, see this recent master thesis<https://repository.tudelft.nl/islandora/object/uuid%3A6450bc4d-74e0-4241-9e16-454cda048949?collection=education>. I think PeerReview<https://www.cis.upenn.edu/~ahae/papers/peerreview-sosp07.pdf> was one of the first systems to use witness selection and random auditing to prevent cheating. In fact, PeerReview and TrustChain share many similarities, in a sense that they both focus on the accounting of data elements in pair-wise ledgers. Recently, we wrote an article that I think address most of your bullet points. If you wish, I can send it to you, with the remark that it is confidential and under double-blind review. If I understand FWSP correctly, then it requires you to keep a log of when each peer entered/left the network, so anyone can later verify that you selected the witnesses correctly according to the protocol. How exactly would you adapt this to a permissionless system where you don't know which peer joined/left the network at which time? To do so, you need some kind of membership function where you can query the full set of nodes currently online. Churn makes this challenging. I think this is one of the main reasons why FWSP is designed around permissioned networks. — You are receiving this because you were mentioned. Reply to this email directly, view it on GitHub<#4629?email_source=notifications&email_token=AIBHHBWJ76WDK3ADKSZRTILQ77WVTA5CNFSM4H3RLBHKYY3PNVWWK3TUL52HS4DFVREXG43VMVBW63LNMVXHJKTDN5WW2ZLOORPWSZGOEKCP6HQ#issuecomment-579141406>, or unsubscribe<https://github.com/notifications/unsubscribe-auth/AIBHHBRQOJUVMPEENRUMF63Q77WVTANCNFSM4H3RLBHA>.

[synctext]

Remarks on this version:

• "mostly theoretical way of creating a stablecoin is to simply promise as an organisation that your coin is going to be stable"; Great point. Make this a bit more principled by giving it a fitting name: "Blue Eyes Backed", for instance.
• intro not yet re-written
• Rewrite intro of Facebook Libra dominance, instead of Tether

Thesis direction first version: a new paradigm for finance: re-inventing money.

• thesis goal: close the reality gap of stable tokens
• devise an architecture for secure stable EuroTokens
  • as-simple-as-possible
  • membership function or permissions or authoritative central coin minter
    • double spending, fork prevention, block hiding
    • certified last-block witness?
  • regulator approval (e.g. +dashboard)
  • scalability, protection against default, quantum-proof in far-far-far future, ease of use
• implementation and field trial with notary using real Euros between pension funds

[rwblokzijl]

Survey.pdf
And the correct version of the lit survey.

[rwblokzijl]

Current progress:
Survey.pdf

(johan brief remarks: writing style, remove negativities, citations, "immature?" and first table; then discuss it)

[synctext]

Unique thesis angle (brainstorm II): a new paradigm for finance: re-inventing money.

• thesis goal: close the reality gap of stable tokens
• devise an architecture for secure stable EuroTokens
  • as-simple-as-possible
  • membership function or permissions or authoritative central coin minter
    • double spending, fork prevention, block hiding
    • certified last-block witness?
  • regulator approval (e.g. +dashboard)
  • scalability, protection against default, quantum-proof in far-far-far future, ease of use
• implementation and field trial with notary using real Euros between pension funds
  • possible involve legal angle
  • possibly cooperate with a master student with legal expertise
• Design Choices:
  • Make a permissionless stablecoin and horizontal scale; Meets the requirements of permissionless innovation!
  • could possibly be pegged against any coin and any asset
  • extreme sharding plus witnesses
  • Checkpointing approach. See our prior work from 2017 on this.
  • Keep a rolling account balance, drop full "unspend tokens" history for scalability.
  • critical assumption:
    • each witness joins the network at some point in time
    • each witness obtains a certificate of joining with a globally unique timestamp
    • making total ordering secure is left for future work

[rwblokzijl]

@grimadas, thank you for helping.

However I currently ask @Tim-W to upload for me when i need an update published, so a different person to go through to upload doesn't really help. I would like to have direct access to publish updates myself so i can stop bothering other people, and get the updates online quicker.

If you need the APK for other reasons they can be downloaded from the trustchain-superapp github-actions build page.

[rwblokzijl]

Transacting without society as an intermediary of trust!

Copyright Creative Commons CC0

[synctext]

epic! 👌🏔️💶

[synctext]

Digital Euro Experiment

Works! We did a test with native implementation of Trustchain and a digital Euro last week. Field test date: 4 March 2021 at 10:30am. The native Android implementation in Kotlin is slowly getting mature. Location: the bar Doerak (with a liquor license! This is a special place, therefore selected as the site for our trail. Shops which sell coffee or closed canisters of alcohol are "essential shops" and therefore open in Corona times.) Creative Commons CC0 license - share freely:

Zooming into the actual mechanism of QR-Codes (Creative Commons CC0 license - share freely)

[synctext]

Welcome Hacker News! Story no.6

[synctext]

Thesis writing progress: 39 pages,

• Final chapter: Deployment and performance analysis
  • photos of Mountain and Doerak experiment
  • stress testing, as described above
• Repeating: What is your scientific contribution? (unique architecture, gradual transition, product/market fit, validated through trails,proven viability, etc.)
• ToDo: single architecture picture within thesis.
• Next sprint: Finish design&problem description chapters (4-ish pages). Thesis ready form!
  • 2.1 The cashless society
  • offline usage
• ToDo: thesis forms, committee

[synctext]

Killer usage? Zero-cost transactions: Micropayments for content and electricity.

[rwblokzijl]

Back to self reliance!

[rwblokzijl]

[rwblokzijl]

Update:

1. Thesis: Problem description and design done
2. Testing coverage of exchange at 80% +

[synctext]

Thesis .PDF of 36 pages review:

• Not standard TUDelft formatting: less dense, wider margins, etc.
• "In addition to people storing their money in private banks for security reasons, the
  digitalisation of society is a powerful motivator.". All first page chapter text is introduction, not sharp enough for a problem description. "the world is moving from cash to cards"; all explanations and context setting, for instance, private vs. public money needs to move to intro.
• "The battle for the future control of monetary systems is a world wide phenomenon." 🔫
• "While having multiple bank accounts is possible, a lack of standardisation and interoperability makes people easily dependent on their one bank and its features." 2.1-2.3 is intro text.
• First sentence of Problem Description chapter please: "Can we create a digital currency that mimics the properties of
  Central Bank backed cash."
• Advice to put this in 2.1 section:
  1. Be a fully functional system of accounting
  2. Preventing unsanctioned money creation
  3. Scale to the size of the European union
  4. Disaster resilience through "No Internet" ability
• Chapter 2: more details such as 3000Euro limit, e-Money license, eIDAS regulation, GDPR relevance and MiCa rules.
• Theoretical grounding in chapter 1 and 2, see style of: https://arxiv.org/pdf/1312.2048.pdf
• More scientific writing and example style (Figure 3.3) https://blog.acolyer.org/2019/09/16/blockchain-provenance/
  

[synctext]

https://www.riksbank.se/globalassets/media/rapporter/e-krona/2021/e-krona-pilot-phase-1.pdf

[rwblokzijl]

Progress:

1. All code fully tested and deployed (found some bugs in ipv8 during evaluation)
   a. Eurotoken business logic code coverage android: 100%
   b. Eurotoken business logic code coverage python: 80+%
2. Evaluation scripts done, log parsing done, and final benchmarks currently running
3. No writing progress since last time

Remaining after today:

1. Writing only

Early conclusion: TPS scales LINEARLY with network size.

Some early evaluation graphs: (formatting needed :p)

1. Blocks evaluated as a function of chain length

2. Validation load as a function of network size (small sample size, but i could only run 1 node)
   2.1: for client transactions

2.2: for validators:

[synctext]

• Using full container isolation (Docker), difficult to scale to many clients
• Try to emulate larger network using multiple processes
• Thesis writing:
  • move Trustchain intro and cashless society to introduction
  • Offline requirement in problem description
• Discussion in design chapter?
  • (selected) allow offline transaction, but usage is restricted until a central server/bank has validated transaction
  • (not used) use Promissory notes to address the double spending problem inherent to offline CBDC transaction?
  • (not used) use Conflict detection using checkpointing?
  • (not used) assume trust, acceptable risk, and maximise disaster-proofness

[rwblokzijl]

Writing progress

[synctext]

• thesis title type: capapabilities (actually, please omit this term; shorter title)
  • writing polishing is the key point to address
  • "P2P EuroToken" listed only twice
  • 13 times peer to peer, not peer-to-peer.
• Mention? https://www.ecb.europa.eu/press/pr/date/2020/html/ecb.pr200702~214c52c76b.en.html
• 2.3. Double spending vs scalability vs decentralization informal. "Trade-offs around double spending, scalability and decentralisation"
• clearly define the double spending problem.
• 3.2. Block-lattice accounting, DAG for both Trustchain, IOTA, and Hashgraph
• disaster mode: spending of received offline money without global validation
  • 3.4.2. Balance vs spendable balance. Better terminology: risk-free money; money without global validation (double spending-risk money)
• Explain two trails (Figure 5.1: Field trial) (Figure 5.2: EuroToken off-line trial)
• Polish still required:
  

[rwblokzijl]

Writing progress

[synctext]

eccentric visionaries imagining a financial system that gives power back to the people. 👍 🥇

• More text polish needed.

If fully decentralized currencies don’t come up with a solution to scalability and stability soon.

Not a sentence, some text still rough.

We show how the EuroToken system can be used to create a scalable CBDC as well as serve as a
private money alternative to current banks and provide the benefits of programmable money with the
price stability of the euro.

unclear No alternative exist for the private money creating monopoly of the banking industry.
Our EuroToken system would be the first public money in the form of scalable CBDC which can act as an
alternative for the distorting banking industry ability to create money with a fountain pen ref and Bern Professor.
One study claims for the UK case that banks gathered £182 billion of cumulative seigniorage profits

• higher university abstract thinking is still missing. Example. Much has been said about CBDC. China has done closed trails, Facebook has a proprietary system (with partial open source semi-goodness). Ironically, all technology for public money is non-public. This thesis is the first step to change this.
• To manage expectations, all online CBDC payments are signed by trusted witness or something. Offline payments are at the protocol level IOU, a formal signed acknowledgement of debt (e.g. non-anonymous). When people come online again the accounts are settled. Debt can accumulate. Debt can also travel 5 hops when offline. Full disaster proof. This bypasses double spending by transforming the problem into a trust issue (without escrow).
• "Chapter Design", please make title more informative.
• "In our prototype we user the Tikkie API to enable users to pay us Euros." add bit more info, nobody knows this system.
• "Figure 5.4: Effect of chain length on validation", deadly sin; no time unit.
• determine 1 CPU for gateway and (1 or )4 CPUs for clients maximum transaction rate.
• general comment, CBDC is a busy hot developing field. Nowhere in thesis is the current implementation technology status described and your exact novel contribution to it. Only implied. For instance, Section 2.6 could use something like: "No trail has ever been conducted to date of a EuroToken connected to the live IBAN banking system to confront the numerous ideas of CBDC with real-world NFC, Bluetooth and Android limitations and flaws. The goal of this thesis is to conduct the first European CBDC trail with real money."

[synctext]

Implications of alternative design choices for a CBDC

The specific design features of a CBDC would have implications for its global outreach and ultimately the
international role of the currency in which it is denominated by influencing the ability and incentives of
non-residents to use it as a means of payment, unit of account and/or store of value. 

These features include: (i) interoperability of the CBDC with non-domestic payment systems, (ii) anonymity of users, 
(iii) potential restrictions on use by non-residents, (iv) the CBDC’s remuneration, and (v) the 
underlying transfer/settlement mechanism, including modalities for offline payments.
                                                                                       European Central Bank

https://www.ecb.europa.eu/pub/ire/html/ecb.ire202106~a058f84c61.en.html

[rwblokzijl]

Writing progress

Everything written once, content is there. Most things still require a pass or 2 for "correctness", readability and flow.

[synctext]

Comments on near-final master thesis:

• thesis work now part-time, besides job
• main comment: writing quality of thesis overall, needs polish. Content is sufficient to defend 🎊 👍 🎊
• "e-invoice, e-receipts, e-identity, and e-signatures", not a sentence
• Abstract is lacking, is this a mandatory feature?
• "With transaction fees at around 59 US dollars [36] around April 21 2021", average or a peak?
• the discussion around central bank digital currencies has been lively among central banks [64] [61] [56] [40] [59] [25] [26] [62] [38] [58] [60]. 👍
• "This thesis creates the first deployed digital Euro, connected to the existing IBAN-based banking system", absent from thesis
• Very much hidden text: "In this project we aim to conform to these requirements as best we can and we evaluate our solution
  by these requirements"
• "We aim to create a payment system that is secure, scalable, off-line transferable, stable, secure and digitally capable." move from end to very start of this section 2.2; not thriller-style writing
• Main Question: "combines the functionality of world-wide online payments", what does this mean? Can this be simplified?
• ?? "3.2. Block-lattice accounting"
• LibTorrent [19], Libp2p [18] and IPv8[PyIPv8]. strange ref
• "For the EuroToken to be part of the Euro system a mechanism of exchange is required." more emphasis: we believe our work is the first digital Euro project to fully integrate with the existing IBAN-based banking system.
• "The destruction flow is a simpler process." is money destroyed? Better re-name to load/unload
• IT WORKS..."Figure 5.1: Field trial", something to be proud of, make much bigger!
• ToDo: remove " risk could potentially be reduced to near 0. - TODO work this out in more detail"
• Figure 5.4, Science sin: draw a line through 4 data points! (and left out the exact datapoints)
• "5.6. ECB requirements" or is this more "5.6 System evaluation and ECB requirements"
• "13 Conditional use by non-euro area residents" please use red flag or green checkmarks instead of simply repeating.
• Opening line for conclusion? "We present what we believe to be the first digital Euro deployment with real money, offline peer-to-peer transfers with disaster-proofing, and real-time connectivity to the existing IBAN-based banking system"

Trace from a faulty connection or software bug, possibly UDP packet loss. Gateway and phone are not yet in eachother IPv8 overlay as fellow peers! 🐛 💥 🐛 Status of background discovery of peers is not included in API; no reliable message delivery used. Money is sent, gateway request is sent "P-A" (Proposed and Acceptance with signed balance message), request "(3)" is sent marked in red, response is received for "(4)" and marked green:

Known ToDo: silent drop by gateway of faulty requests.

[rwblokzijl]

Thesis, final version: https://github.com/rwblokzijl/Msc-thesis-EuroToken/raw/master/EuroToken-R.W.Blokzijl.pdf

[rwblokzijl]

Current state of literature survey: Survey.pdf

TODO:

1. Update information to 2021
2. Make a beter taxonomy image
3. Fix tables

[rwblokzijl]

Literature survey, final version: https://github.com/rwblokzijl/stablecoin-survey/raw/master/Survey.pdf

[synctext]

Trails concluded, live on Google Play store. Moving next live trail into issue: #6306.