Reimagine global payments with the creators of the Interledger

Lawil: You are listening to another episode of the future money podcast

presented by the Intelligent Foundation, where we invite people of all backgrounds

and disciplines to imagine what a financially inclusive future might be.

I'm Nawil Karama, and today our newest host, Sabine Scheller, will

interview two very special guests.

In this episode, I am in conversation with the creators of the Intellectual

Protocol, Stefan Thomas and Evan Schwarz.

Their conversation covers a variety of topics and reflection.

We dive into their early days and the challenges they've faced in creating

a universal payment system and a role of ILP in enhancing efficiency.

They dive into smart contracts, decentralization, and a need

for a universal payment network that connects different ledgers.

The conversation highlights the successes and the mistakes made along the way.

And of course, the ongoing work to improve and integrate technologies.

We hope you enjoy another episode of the Future Money Podcast.

Sabine: Welcome to the Future Money Podcast.

Today, we have.

Two guests with us, we have Stefan Thomas and we have Evan Schwartz, the

co creators of the Interledger Protocol.

And for the very little chance that people haven't heard about you

ever before, do you maybe want to introduce yourself real quick and

tell us a little bit about yourself?

Stefan: Yeah.

My name is Stefan Thomas.

I kind of grew up loving writing code and, um, worked as a freelancer,

a web developer for a long time.

And then I got into Bitcoin back in 2010 and got really fascinated

by the idea of You know, you could write code that moves money around.

And that has been my obsession ever since.

I think the thing that got me very excited about Bitcoin at the beginning

was the idea that you could send money to people internationally very easily.

As a freelancer, I knew that there was a lot of friction there.

Working with people in other countries was always very difficult.

Just getting them paid and getting the money there.

So Bitcoin didn't fully live up to that by itself.

I think it's a great foundation.

But I ended up joining Ripple, uh, working on XOP Ledger, um, working on

other blockchain technologies as the chief technology officer at Ripple.

And as part of that also created a research team, which Evan

was a part of and he'll tell you his perspective on that.

And yeah, during that time researching things and trying to

figure out like what are some of the missing ingredients to take.

Blockchain technology and other existing financial technology and kind of bring

it up to the, to the level that we'd like to see where everything feels

really frictionless, um, that led to the development of Intellidger.

And so nowadays I am the chairperson of the Intellidger foundation and I kind

of work full time on open source code.

I work on a project called Dasi, which we'll probably get into later.

And I'm just trying to get Interledger out there into the world.

Evan: And my name is Evan Schwartz.

I've worked as a software engineer for the past 10 plus years.

I've worked on a couple of different open source projects in

general, like open source things.

I've always wanted to be an inventor and that's kind of the thing I love doing.

So like coming up with new ideas for things that included working

with Stefan on Interledger and some other things after that.

Sabine: So Evan, I know you guys met at Ripple.

Did you have any other prior experience with payments and

financial products, stuff like that?

Or how did you, how did you end up in that space?

Evan: I had no, no prior experience whatsoever.

I was just out of college and looking for jobs.

And Got introduced to ripple, to be honest, was not particularly

interested, but was like, you know, I need interview practice and so

I'll, I'll take the interview anyway.

And then read up on it seemed kind of interesting and then met up with

Stefan for an in person interview.

We ended up talking for an hour and a half and I was like, wow, this seems crazy.

This is like a 14 person company talking about connecting the global

financial system more like that seems nuts, but also very interesting.

And that was kind of how.

How we started working together.

Stefan: This is a long time ago now.

What was your knowledge about blockchain at the time?

Were you interested in it at all or didn't care?

Evan: No, I didn't know anything about it.

I had never heard of it before being put in touch with, with you and had

no particular interest and was just like, Oh, okay, let me, let me, let me.

Find out about this.

And then your interview style at the time was just explaining Ripple's technology.

And then I think judging people based on the questions that they were asking.

And I didn't know anything.

So I was very happy to just ask lots of questions and that worked out well.

Stefan: Yeah.

I was like, lock the door.

This, this person's not leaving.

Sabine: But Intellidger wasn't something that you already had in

your mind at that time, Stefan?

Stefan: I think maybe like.

The, the sort of seeds were in the lack of scalability in existing ledgers.

Like I already knew that we're going to need something.

Because if you think about how a blockchain works, you know, you have a

ledger and it's so distributed across lots of different computers all over the world,

but every transaction that happens has to be recorded by all of those computers.

And so as more and more people try to transact, eventually.

The math just doesn't math and, you know, you're just doing too

much work for each transaction.

And so, you know, in the traditional finance world, a traditional payments

world, the way that you often deal with that scalability issue is with netting.

So, like, if you make a credit card transaction, there isn't like

an international bank wire that one to one corresponds to your

credit card transaction, right?

Like, The way that works is that the banks will add up all the

transactions and then send one big transfer to, to net it all up.

And so I always thought it would be something like that happening for

these newer technologies as well.

I just didn't know exactly what it would look like.

Evan: I think the other kernel of an idea that contributed to it a lot was

when I joined Ripple, the company's whole mission was about connecting

the global financial system more.

And the idea was, like, if you can get everyone onto one ledger that

supports multiple currencies and atomic transactions between them, then you

could have global interoperability.

And that idea, I think, was kind of in the, in the zeitgeist at

the time, to some extent, though maybe a little bit before its time.

And I remember at some point, Stefan saying, I don't know if it's going

to be possible to get everyone on one ledger because like there was

the like Bitcoin sort of started off the whole blockchain thing.

But then a lot of other people came out with with different blockchains

with slightly different features.

And I think like one of the things that I always give a lot of credit to Stefan

for was like the company's whole mission was like, let's get, let's connect

the entire world's financial system.

Let's connect everybody to this one ledger.

And I think the way that I remember Stefan looking at it was like,

Oh, what if that's not possible?

Is there a way to achieve this vision in a different way?

Uh, and I think that was the current, that was one of the

kernels that kind of kicked off.

Stefan: I remember having a lot of anxiety about sharing that

thought with my colleagues.

Like the very first person I told was Monica Long, who was at the

time our head of communications.

And I basically just like took her into a meeting room and I was like,

so this is going to sound a little weird because you know, our whole thing

is that we want everybody to connect through the XRP ledger, but, you What

if there were multiple ledgers and we had to think about how to connect

them all together and like, what if we changed our view and, and the XRP ledger

is just one of many, many ledgers.

And that seemed initially very like counter to the company's goals

and took us a long time to kind of figure out how it all fits together.

But I think looking back, you know, even with the original vision, you

still have to deal with legacy ledgers.

You still have to deal with bank internal ledgers and companies, internal ledgers.

So the world has many, many ledgers and you need a way to get across them.

So that, you know, that was sort of inevitable, but yeah, it was

very scary at the beginning.

Sabine: We've already talked a little bit about blockchain inspiring it, but

it not being the greatest solution.

So you came up with Intellidger for, um, the more non technical audience.

Can you briefly describe how Intellidger works?

And I know this is a challenge, but I have full confidence since you pitched it at

Ripple that you will be able to do that.

Stefan: Well, who are you asking?

Are you asking me?

Are you asking Evan?

Sabine: Uh,

Stefan: cause I think you might get slightly different explanation.

Sabine: Hmm.

I'm asking Evan this time.

Evan: All right.

Interledger is about routing money across different payment networks.

So there's lots of different payment networks in the world.

And the idea is to come up with a really, really simple way.

Of sending money across them so that you and I could be on different payment

networks and still send money to one another I think that's the simplest way

that I can put it It's also worth adding that we in thinking about the design for

how to actually do that We took a lot of inspiration from the design of the

internet, which is also why the names are somewhat similar But the internet

is also about routing Packets of data, not money across independent networks.

So I'm on a different internet service provider than you guys are.

And that's fine because the internet just makes the connection

happen in the background.

And that's kind of the hope with interledger is that we could be

on completely different payment providers and still be able to

send money between one another.

Stefan: Yeah.

I mean, like we could talk for hours on this, you know, different

ways to explain intelligent.

I'd say maybe a couple of thoughts, like one.

If, if we're just talking about what's the goal of interledger,

that's like one side of it.

Right.

Which is, I would say just making money move very efficiently and, you know,

getting to a point where, you know, communication has become so ingrained

and effortless, you know, you don't think about like, Oh, you know, we're

gonna have to write a letter and I'm gonna have to take it to the post office.

Like you just type whatever you want to send to somebody and you send it.

Within seconds, they can read it.

And we haven't quite reached that level yet with, with payments, even though

they're also just bits and bytes.

And so IntelliJ is essentially trying to, to catch payments up to

the same level that the data is at.

So that's, that's one side of it.

And then when you talk about the technology, I think Evan kind of already

covered, like it's very much inspired by some of the key ideas behind the internet.

One of them I would highlight is this idea of just it being an

abstraction layer, it's just an API.

Like you're, you are.

Building applications for interledger.

And you don't know if they're eventually going to run on some blockchain or

they're going to run on some bank ledger, they're going to run on some other system.

It doesn't matter.

You're programming your application for interledger, and that means

it's going to run everywhere.

So it's kind of like, um, connecting all the different solutions together.

And then I think the other thing, which is maybe getting a little too into

the weeds, uh, at this stage of the conversation, but I'll mention it briefly,

which is the end to end principle.

So the internet.

Kind of was competing it at the time when it was being developed with other,

lots of other network interoperability standards, because people realize,

okay, we have all these networks, but you know, kind of would be nice

if they were all connected together.

So there were a bunch of different efforts along those lines, but I

think one thing that really helped the internet win and become the standard

that we all use today was that it was able to be much more simple.

And the reason it was able to be much more simple is because.

It realized that there are a lot of features that you can

provide on the network level, like reliability, checksums, you

know, also the things like that.

But if you actually skip all of those and you make a deliberately

unreliable core network, that core networks ends up being very simple.

And then what you do is you treat all those.

Issues or you handle all those issues at the end points.

So when I send a packet over the internet, I don't know if it's going to get there.

Maybe not.

Maybe it will, maybe it won't, maybe it'll take a while.

Maybe it'll get there tomorrow.

Like, I don't know.

But I will handle those different failure modes and you kind of have

to do that anyway, because whatever reliability mechanism you implement

on the network layer could fail.

And so you don't really lose anything by doing it this way, but you gain

a lot of simplicity or like you lose a lot of complexity in that sense.

Right.

So we tried to take that same architectural approach with Intellidger.

And if anything, you know, I mean, first of all, credit to Evan,

because he was the first one to kind of think in that direction.

And that ended up being, I would say the key breakthrough is like.

Really using the internet as the foundation.

Um, for the design and we've been surprised again and again, how

well it actually translates over.

Like there've been so many things where I was like, surely payments are different.

Money's different in this way or that way.

And it ended up being like, no, actually we can just do what

the internet does, you know?

So it was very interesting.

Sabine: We are in version four of the Intelligent Protocol right

now, and I'm assuming we made it simpler from one to four.

Is that correct?

Stefan: Yes.

I would say much simpler.

Sabine: Can we make it even simpler?

Do you have ideas?

Yes.

Stefan: Um, there are actually a few things I am thinking about.

I don't know if we should talk about this here, but it's kind of interesting

cause like the internet went through its own sort of revision with IPv4 to IPv6.

So for those who don't know what follow network technology, um, IPv4

was the original version of the internet that ended up being popular.

I think a lot of internet traffic, I don't know what the numbers are, but,

uh, probably the majority of internet traffic is still using IPv4 today.

Okay.

But there was sort of one big issue with IPv4 was that it was meant

as a sort of a testing version.

It wasn't really meant to be the thing that then takes off because

it had a limited address space.

When I say limited, it's like 4 billion, a little over 4 billion addresses.

So it's, it's not that limited.

But when you're trying to connect the whole world, like it

does start to become an issue.

And with the number of devices that are trying to connect today, it's

definitely become a bottleneck.

And so that was the main driving force.

But of course, when you're doing a revision to the core protocols, you

try to make some other improvements.

You cut some stuff you didn't end up needing.

You add some stuff that was missing.

And so there's a new version of the internet protocol called IPV6.

And people are trying to roll it out and have been for many

decades, several decades.

And.

We're sort of in a similar spot, I think, where like, you know, there is IPV4.

It works great.

It has all the things you need, but we're always thinking about like,

what are some tweaks we could do here?

Some, some things we could clean up.

Um, I think one thing that is sort of a mistake that, that I

pushed for at the time was the date format in the Intellidger

packet is sort of a textual format.

I'm not going to go through all the reasons why I thought that was a good

idea, but I think like, Today, even when I'm writing my own implementations of it,

I'm like, I wish it just, just a number, just like a lot of network protocols do

just use a, an integer, um, so kind of wish it was that there is a congestion

control mechanism in the internet protocol called explicit congestion notification.

CN again, it could get very technical here, but basically it allows the

network to detect when congestion is about to happen without actually

having to drop any packets.

So it increases efficiency.

The internet was able to implement it because they had some bits

available that they could sneak in and make these the ECN bits.

We don't really have any spot for that in the intellectual protocol format.

So yeah, we might make some tweaks and stuff.

That's actually one of the conversations I'm very excited to have at the

summit in Cape town later this year.

Sabine: Likewise, Evan, do you have ideas?

Stefan: Uh, no,

Evan: I think it's good at this.

Um, no, in all seriousness, I mean, the approach that we took with the

different versions was we, we had this idea, like, we don't know what

the final version will look like, but we'll know it when we see it.

And I very distinctly remember when we had that feeling and it sort of gave

us all goosebumps at the time because we had spent so much time poring

over, like, how much can we remove?

Do we really need this aspect?

And we had a couple of different protocols that were part of

what we called ILP at the time.

We had a couple more fields in the packet.

We debated, do we need a packet format?

I was the proponent of not until convinced that it was a better idea to have a

specific format and we like really poured over every aspect of it to try to see,

is there anything we can rip out of here?

And when we got to the What we considered at the time the final version, or I think

still sort of do, or I still do, let's say, uh, we had that feeling of there's

nothing left to take out for the thing that Stefan mentioned, I would be curious

whether, like, that extra bit would be possible to add in a non breaking way so

that, like, maybe there's a version 4.

1, but Ideally, not a five or not a five for a long time, because

I think there's a lot of value in maintaining interoperability

and not making breaking changes.

Stefan: Yeah, I definitely agree with that.

I think it's for protocol designers.

It's always very tempting to make breaking changes because you

always see the next shiny object.

But especially when you're trying to get the new protocols off the ground, that

can be a big problem if you can't see.

Kill the momentum,

Sabine: I'm not going to lie, I am a fan of that current version as

is, but I mean, there's the, the intellectual protocol itself, but then

there's also the intellectual stack.

So we have multiple protocols that all together define kind of what intellectual

is and you design all of them.

So maybe this one is for Evan.

What's your favorite one in there?

What do you think is the most rounded?

Evan: Definitely ILP itself.

So the the idea of the stack is similar to the internet There's there's different

layers of of the internet stack different people draw the lines in different places

But roughly you have you have networking which on the internet that's technologies

like Ethernet you have internet working Which is the internet protocol?

And that the only job of the internet protocol is just saying,

I have this packet of data.

Can you get it over there?

And it defines what over there means, but it doesn't tell you anything

about how to get over there, how fast you need to get it there.

How like it's just like a way of saying over there.

And then on top of that, you build all of the reliability

stuff that Stefan had mentioned.

All of the web and all those technologies are higher level and the whole idea with

the end to end principle that Stefan mentioned is that by trying to simplify

the core as much as possible, you make it so that we don't really have to

agree on that much across the entire thing, and that allows it to evolve on

the higher levels and the lower levels.

So the technologies that the Internet was built on have changed Many, many times.

And there's been a lot of innovation on the networking layer.

And there's also been new protocols that have been built on top of it.

And that's one of the things that's, that's really, really cool.

Interledger tries to take that same approach so we can have new,

new ledger technologies that it's built on and then new application

protocols that are built on top of it.

But the idea is that the interledger protocol should stay the same

because it's just trying to define.

Can you get this money over there and similar to the Internet, it's defining

how you address things and how you say over there, but not saying how

you get there or anything like that.

Stefan: Well, I'll have a different answer because I just worked on a pre

implementation of the stream protocol.

So we're talking about the end to end principle, trying to get all that

complexity out of the ILP intelligent protocol and moving at one layer up.

Well, that layer up is the stream protocol.

And so I think a lot of the credit for why IntelliJ is so simple actually belongs to

the stream protocol because that's, what's allowing IntelliJ to be more simple.

And, um, you know, Evan was the one who developed a lot of stream

and designed it and implemented it.

And I hadn't even really looked at the implementation back then.

And so over the last couple of months, when I was re implementing it, Just to

kind of learn it better, I really got a much deeper appreciation for all the

thought and design that went into it.

So my, my answer would be the stream protocol.

I love it.

It's really cool.

Evan: Well, I will repass that credit onto the QUIC protocol designers because

QUIC is a newer version of kind of replacement of TCP, which is kind of

an important protocol on the Internet.

Um, and QUIC is a newer version that adds a lot more fancy features, and that's

based on a lot of years of people using TCP and finding all the problems with it.

And so QUIC was a really well designed protocol, and we were

kind of like, okay, great.

If we want to design.

Transport layer protocol for interledger can we take inspiration not from the

original version of the Internet's transport protocol, but also from what

they learned in the subsequent decades.

And so a lot of the time spent developing stream was basically like

I had the RFC for a quick open on one.

In one tab and then a parallel one was like writing, okay,

that seems relevant for us too.

Great.

Let's copy that idea.

Oh, great, great, great.

And that was, that was a great jumping off point to build that protocol.

So most of that credit belongs to the quick authors.

Sabine: Stefan, you've mentioned Darcy now twice.

You've mentioned it early on and now you said you've been

working on a re implementation.

Do you want to tell us a little more about Darcy and what your goal is with Darcy?

Stefan: Yeah, I would say that.

It's interesting to think that we've been working on this now for 10

years, like a little over 10 years.

And if you'd asked me like, where would, where are we going to be in 10

years, like 10 years ago, I probably would have said that the adoption

would be further along than it is.

Right.

And so I think that, you know, I, I will say that I'm personally made a

lot of mistakes in terms of like the strategies to pursue and how to drive

adoption and some of the decisions along the way, but thankfully those

are all, you know, transitory, right?

Like you, you make a mistake in the strategy for adoption, you learn from

it, you try a different approach.

The parts I'm much more happy with is this, how the actual protocols

are designed and everything.

But in the vein of like how, what's a better strategy, the best success

that we've had with Intellidger were probably in 2019 when we had sort of a

community network built around Codius and Intellidger and people could run their own

Intellidger nodes and things like that.

And I remember that time as being very dynamic.

Like this was the time where, you know, somebody made a dashboard for

seeing the status of the Codius network that we had no idea this was coming.

We don't know, I think we still don't know who built it or just, I don't know.

Um, and it just sort of popped up and it was amazing.

And I really regret that at the time we sort of said like, okay, we have to move

towards like more regulated institutions and working with these like, you know,

traditional financial institutions.

And so the community network kind of needs to take a step back and we stopped

supporting it and we kind of actively discouraged people from doing that.

And I think it was a huge mistake because for a community to grow

and thrive, like people need to be able to actually do something.

Um, and participate and, and so on.

And so I wanted to bring some of that spirit back to the project.

And, you know, we are living in these amazing times where there are all

these blockchains and you can just, you know, write some code and it'll connect

up and you generate a private key.

And so suddenly you can send money around.

And so I was very interested in bringing that feeling back.

Dossi is a peer to peer implementation of Intellecture.

So rather than.

It's being meant to be run by centralized organizations.

It's sort of something that you just download, you run it, and it does stuff.

It does intellectual stuff.

Um, it speaks all the intellectual protocols.

From the bottom of the stack all the way up to stream, uh, and even open

payments, which we haven't mentioned yet, but that's sort of a, how to

negotiate a payment, like how much should I pay that sort of thing.

And, um, it's my hope that, uh, people try it out and play around with it and

learn about intellectual that way and hopefully drive the adoption forward.

Ayesha: Hey there listeners, you're tuned into the future money podcast,

where we explore everything related to digital financial inclusion.

I'm Aisha Ware, program manager at the Intellectual Foundation, and

we've got something exciting for you.

But before we dive back into the episode, I wanted to share a project I was

involved in collaboration with Carolyn Malachi and students at Howard University

audio advanced production course.

The course is a capstone for seniors in the audio sequence.

It is designed to challenge students to develop long form audio

productions, including podcasts, audio books, film scores, and more.

Through this project, students created interstitials about Interledger

for our Future Money podcast.

Here is a sample from Shamari Hall, a 2023 graduate of Howard University.

Stay tuned.

Shomari: Welcome to the Interledger Summit.

Join us as we bring together innovators, regulators, and advocates

for financial inclusion to shape the future of digital financial services.

Hear from change makers.

Problem solvers and visionaries who are working to create a more equitable and

connected world through Interledger.

Don't miss the chance to network, discuss ideas, and to be a part

of a movement that's transforming financial services for everyone.

Visit interledger.

org slash summit to learn more and explore how digital finance

Can benefit everyone, every way.

Ayesha: Thanks for listening to Shamari sample.

We hope you enjoy the rest of the episode with Stefan Thomas and Evan Schwartz.

Sabine: Well, now that you've mentioned Codius, I have to ask you

to explain Codius to the audience.

Stefan: Well, Codius is an interesting one because in some ways it's the

sort of missing link between, um, the blockchain era and like when we

were working on blockchain a lot.

And the Intellidger era, basically, you know, I was very

interested in smart contracts.

Um, I helped start the Swiss meetup group for Bitcoin, which was one

of the groups that like really dove deep on smart contracts.

When I was working for Ripple early on, I was working on, uh,

general purpose smart contracts.

So Bitcoin had this sort of very minimal, uh, stack based

scripting language built in.

So we were thinking about like, what would it look like if you built

like a general purpose programming language into a blockchain?

And, you know, somebody was crashing on my couch at the time

was Vitalik, so he clearly got somewhat inspired by that work.

And so, you know, that sort of evolved over time and I think that got to a

point where I was like, okay, why are we even trying to build all the logic

into, into the blockchain itself anyway?

Like the, a blockchain is this sort of thing where, as

I mentioned at the beginning.

You're running everything many, many times.

And so it's very computationally expensive already.

So why are you doing all of your logic on that layer?

The way we do it in most software architecture is we have a database

and then we have our business logic separate from that, you know, you

have a separate layer for that.

And so, you know, we started to think about like, okay, you know, this

was Evan and I back in the day as well, you know, thinking about like,

okay, so we have the blockchain, which is kind of our data layer.

Well, what would a decentralized business logic layer look like?

And that became the Codeus project.

And the basic idea is just, okay, you have these stateless systems, so they are

not databases and all they do is they run your code, but you can have many of them.

And they then might make transactions against the blockchain.

They might query some traditional API, et cetera.

It's, it's actually kind of a pretty simple idea.

You just have this like group of nodes that does stuff for you.

And that way you implement smart contracts in a more flexible way.

But the problem we ran into very quickly was, okay.

So we have this very neutral smart contracts layer, you know, the

smart contracts layer, that's not tied to any particular blockchain.

You could use it with any blockchain.

You could use it across blockchains.

You could use it across non blockchain systems, but you kind

of have to pay these hosts that are running the code for you and.

You could pay them with a credit card or something like that.

But that seems very clunky.

Like you're trying to pay a hundred different hosts with a hundred different

credit card payments of 12 cents.

Like that seems very inefficient.

And so I think that was partly what prompted the need for the efficiency that

that intellectual brings to the table.

So.

I think Codius has always been this sort of idea that everyone's

still very interested in.

It still seems like a very good idea, but it's taken a bit of a backseat compared

to IntelliJ because IntelliJ seems like the thing that you need to enable it.

Currently, there is a bit of work going on on Codius here at Coil.

You know, we haven't shut down entirely.

We've, you know, spun down quite a lot, but we still have

some, some things going on.

And one of those things is.

So I don't want to say too much yet because it's obviously

still very early days.

Sabine: Very exciting.

Codeus is what got me hooked on Interledger.

Evan, any other project going on around Interledger early on that I

don't know about, is there anything else that you experimented with?

Evan: I think one of the coolest parts about interledger is that neutrality

point, which is kind of what, what Stefan was mentioning is like why you

need something like that for codies.

He mentioned the efficiency.

I think the other important point is the neutrality.

Like you're not picking one.

Blockchain, which, you know, then all the initial people that got in on that early

get super rich and you're not picking like one company's technology, you're

picking kind of a more neutral standard.

And so, um, like one of the toy experiments that that I had done back

in the really back in the day was like integrating it with torrenting

with the idea that torrents are an efficient way of downloading media files

and other and other types of files.

But the two problems with it is you have both an unfairness about like the actual

torrent network, but then also the content creators don't get paid, which is why it's

historically been associated with piracy.

And with something like interledger, you could actually have the original content

creators get paid along with the people that are, that are helping torrent.

And so that was something that we had played with as well, which relies on that

neutrality and the currency agnosticism.

That was another example of something that we played with.

Stefan: It's actually really interesting hearing you talk about torrenting, because

it sort of reminds me about like how the world has moved in a certain direction.

Like, you know, so many of the ways that we interact with digital services

today is very, very centralized.

You have these gigantic companies, they have gigantic social media networks,

you know, I don't have to list all the names, but you know, the usual suspects.

And, you know, when, when Evan and I, when we were growing up, like, you

know, there was the web, you know, and there were lots of different websites

and obviously that still exists.

It's just really outshined at the moment by these very large hubs that sort of have

taken over the mass of, of internet use.

And, um, it's kind of interesting that that is happening at the same

time as some of these decentralization technologies, you know, making progress.

And there's so many projects like, uh, Blue Sky and Nostr and, and

Mastodon, all these different things that are trying to distribute these.

And I really wonder, like, what is the missing piece that really makes it flip

over and, and makes those services more attractive than the very centralized ones.

I think one of the things that you can certainly speculate

might be part of that is.

The ability to create business models.

Cause like, if I can, you know, be on one social media network where I get

paid ad revenue and I can make money, but then I'm on a decentralized version

of that, but I don't get any ad revenue.

I don't get any money.

Then obviously I'm going to go with the, the mainstream thing that pays me.

Right.

And so I always wanted there to be like an alternative where you

could make a living by creating content, by publishing content.

But still not be below one of these, you know, centralized platforms or be

beholden to a centralized platforms.

And I think that that's still very much like people are looking for that solution.

It's just, nobody has quite got the recipe, right?

I think for us, like the, the part that we're focused on as the IntelliJ

community is like, let's make sure IntelliJ is the best protocol for that.

And then when somebody wants to get the recipe, right, they, they reach

for IntelliJ to solve that problem.

Sabine: Since you mentioned the web and online, so how do you see a universal

payments network like Intellidger building more equitable opportunities online?

Evan: One of the things I always found super exciting Intellidger

is that it's hard to say.

Um, because I think when the internet was, was rolling out, it was not

obvious how widespread it would become and how ubiquitous it would become.

And I think that's sort of the.

Potential which is both like very interesting and also to be honest a

little bit scary with something like interledger where I think it has the

potential to Be everywhere in a sense.

Um, and the the idea of making it such that there's like one universal payment

Network or internetwork such that anyone can pay anyone for anything basically it

Would make it possible to include that in a lot more places So stefano mentioned,

uh the web and obviously like way more of society and life is being hooked up to

the internet and The payment experience is kind of clunky still and so you that does

push towards centralization with Services that can hold on to your credit card

details and then charge you little amounts every once in a while So with interledger,

you could have payment experiences that are much more Seamless that are hooked

up to a lot more places so that that could be ranging from like paying for

transit in different countries to Uh, consuming content or any, any type of

business transaction that you do instead of this discussion around like, Oh, what

payment network should we use for this?

You just say, here's the money and then it's done.

That's a little bit of a vague answer, but it, I do think it's

a little bit hard to predict how something like that would work.

Roll out or like what kind of applications people would end up with?

Because I think a lot of the most exciting applications of the internet were things

that probably would have been very difficult to foresee before it started

Stefan: rolling out.

Wow.

That's a deep topic.

I mean, you know, I started a startup coil, um, in 2018, which was

essentially built around that question.

And so.

I would say that over the years, we've learned a lot in terms of like how the

ecosystem of the web actually works.

I think one of the things that you would hear a lot, and also that we thought

about a lot when going into it was this idea that like, can we get rid of ads?

Cause ads seem kind of annoying and they seem kind of a distraction, but

the issue is that what ads really do is they sort of solve in a very elegant

or seamless way, the problem that like.

You're getting this like small amount of value from consuming content.

And there's also a lot of value in companies trying to get

their product out there, right?

Like you'd say you're an inventor, you know, Evan says he's an inventor

and he's invented lots of things.

How does he get people to use his inventions?

Right?

Like he's got to market it somewhere.

He's got to advertise it somewhere.

Right.

And so that is a very important function to fulfill.

And so you can't just get rid of ads.

They create a lot of value on both sides, not just in the things that they fund,

but also in the things that they market, you know, And so I think that if I had

to make a prediction on how something like IntelliJ could help in the future is

maybe creating a bit more flexibility in terms of maybe I want to consume ads from

this source, and then I want to take the money that I made from consuming those ads

and then use that to pay for the content that I'm consuming from that source.

And it doesn't have to be.

All linked together, because I think that's where a lot

of the friction comes from.

You have advertisers that don't want to advertise on YouTube because

their beautiful new product is going to be next to a not so nice video.

And so then YouTube cracks down on what you can say in your videos.

And so then everyone is upset because, you know, their particular

community, that type of discourse is okay, but it might not be brand safe.

And so then they complain that they're being censored.

And so there's like all these different things that create friction when

you put the content and the, the ads very tightly coupled together.

Not to mention the centralization that you get where it's like, if you're a

content creator and you get kicked off of YouTube, it's not like there's an

equally large long form video sharing website that you can go to instead.

It's sort of like, you know, you're going to a much smaller platform

from there, you know, and so I think that the biggest opportunity is to

make it so that there can be lots of little hubs and they're all kind of.

Working together in the sense that like, if I, if there's one hub over here that

has very relevant ads, and I really like watching their ads, I can somehow

hook that into my client and then go consume the content from over here.

And everyone's kind of happy that that's, that's sort of the vision.

I think there, I glossed over a lot of the complexity.

So there's still a lot of work to be done before we can see that, uh, realized.

Sabine: And then maybe moving even broader outside of online to the real world.

Evan, what do you think?

How will Interledger impact, uh, individuals or the society in large?

Evan: I'm excited about playing around with Dossi some more, and that's not,

that's not quite the deep discussion, but I think actually going from, you know,

Lots of discussions to being able to just spin it up and use it is quite exciting,

because I think as Stefan was mentioning before, the community kind of needs that

dynamism of actually using it and building things and being able to, like, make,

make it real, not just talk about it.

Stefan: Yeah, I agree with that.

I think the, the nature of predictions is that you're going to be wrong anyway.

So it's like, why not?

I think the, the best thing you can do is you can look at past experiences and you

can try to find general principles that seem to apply across different categories.

And like one of those general principles for me is that when you

have a system that, you know, is very important, it's very central, such as

the communication system in the case of the internet and the payments,

the world of payments and economic exchange in the case of Intellidger,

when you have a system like that.

And there are inherent transaction costs, there's sort of a floor, like, you

know, anytime you do anything, you pay this much, you know, then whenever you

lower that floor, it's not just lowering the cost of the transactions that are

currently happening or the things that are currently happening, so those get

cheaper, sure, but then what happens is that there is You know, a hundred times,

a thousand times more transactions that weren't happening because it's just

wasn't worth it for those use cases.

And so with the internet, it's like the amount of data being transmitted

has gone up millions of times.

You know, I don't know how many orders of magnitude, but many orders of magnitude.

And then in the case of, um, trading, for example, when, when we went from,

you know, people calling their broker on the phone to, you know, automated

algorithmic trading, the amount of trades went up by orders of magnitude.

And so you can sort of expect that something similar might happen with,

with something like Intellidger.

And then once you have that, then you kind of work backwards and you say

like, okay, well, you know, clearly it's not going to be a person swiping

a credit card for each one of those 10, 000 more transactions, because then

you would be spending your entire day just swiping your card over and over.

So that's clearly not what it would be, right?

So it'd have to be something more automated.

So maybe you have like different systems and protocols where like your devices

are making payments to each other.

You know, like you're traveling and you need internet access and you don't

have any relationship with a local provider, but your phone has some money.

And so it just goes out and buys a internet connection from somebody.

And maybe not even a long running subscription, just like as long as

you need it while you need it, it just pays a little bit, things of

that nature, um, might be unlocked.

I think one.

Thing that while being a buzzword right now, I think is very relevant here is,

is sort of AI and computers having more dynamic things that they can do, right?

Like previously you had some, it's very rigid algorithms where like some

programmer would go and build things in a certain way, and then it would,

if you could write executed like that.

But that is really opening up with a lot more possibility today.

And so I could see a lot of payments being made by some kind

of, you know, AI type actors.

Like, I don't really like the term AI cause it's for reasons that like, it's

not really artificial and it's really just a different kind of intelligence.

But I like the idea that like, we would have this vibrant marketplace

of, of computers paying each other.

That's, that's, um, something I think would happen.

There was actually a tweet recently by, I think it was Andrej Karpathy, who's a

well known person in the AI space, that a lot of people sent me because it was

something to the effect of like, if you could lower the transaction costs, then

the volume would explode, which I, he's pointing to that exact same principle.

Sabine: Well, thank you both for taking a stab at those very deep questions.

What kind of other deep discussions are you looking forward to at the summit

that is happening end of October?

Stefan: Yeah, just wait until I start telling you about like liquidity

management, stuff like that.

It'll be a deep discussion to the show.

Trust me,

Sabine: Evan, that sounds like you really want to hack.

So you should also join us for the hackathon that is happening

the week and before the summit.

Stefan: There's one more thing I'm looking forward to talking about is IL DCP.

I think it's one of the protocols that's gotten the least amount of love relative

to what it could be just to explain.

So IL DCP is the Intellidger Dynamic Configuration Protocol.

What it's used for is if you are connecting.

Like you, you, you spin up some Intellidger enable software.

Then you say, here's your Intellidger connection.

It would be nice if you didn't have to also tell it like, and

you should use this currency.

And this is the amount of units per currency that, that are expressed.

And this is your address and a bunch of other things.

If it could just detect all of that automatically.

And so that's what ILDCP is meant for right now.

It really does only information about the currency and your address.

But there is a lot of other stuff that it could communicate.

One of the things I ran into recently was the maximum size that

an intellectual packet could be.

That could be something that I'll, DCP tells you.

It could be, like, what is the nature of the relationship between you

and the person you're connected to?

Are they sort of your provider?

Are they an equal peer?

Are they a client?

Um, so you can sort of figure that out.

So there's a lot of stuff like that, that I think could make intelliJ a lot more

frictionless to use and set up and kind of, you know, make everything kind of

feel a bit more automatic and magical.

If we implement it to all of that.

Sabine: Fun story.

ILDCP was actually deprecated by mistake for a little

while, and then we revived it.

So in the GitHub repo, it was gone.

And

Stefan: I think that proves my point about like ILDCP has not

received the love that it deserves.

It is such an essential protocol.

And has so much potential.

Sabine: Yes.

And I'm very much looking forward to talking about ILDCP and all the other

protocols at the summit and the hackathon the week before and the, like, then

there's a week in between, so we get a lot of time to talk about all those things.

But I also want to thank you already for talking to me today.

This was so much fun.

Um, I learned a lot.

I'm very much looking forward to seeing you soon.

Stefan: What are we wrapping up already?

Okay.

Well, it was a lot of fun.

Thank you.

for hosting.

Hey,

Ayesha: it's Aisha again.

We wanted to remind you that we are nearing the intellectual summit.

Join the open payments movement where a global community of change

makers is re imagining the future of digital financial systems.

Our official summit will kick off on October 26th with a dynamic schedule of

inspiring speakers and engaging sessions.

We also welcome you to our pre summit activities, including a community open

house on October 25th and an ILP hackathon on October 19th and October 20th.

Lawil: If you're unable to attend the summit, but you would still love

to follow our sessions, then you can find the Interledger Summits live

stream and previous recordings on the Interledger Foundation's YouTube channel.

For more information, follow the link in the episode description.

And as always, thank you for tuning in to another episode

of the Future Money Podcast.

We'd love for you to like and subscribe wherever you listen to your pods.