Sam Smith
(if able to attend)

Discuss Sam's thoughts on protocol layering and where KERI protocols, serialization formats (such as CESR), and KERI key management would fit.

• Sam felt it was very important to "unpack" the trust spanning layers
• To do this, he had to go over the PAC Theorem - see slide screenshots #1-#6 below.
• It means that authenticity and confidentiality and privacy
• KERI layers it: authenticity, then confidentiality, then privacy
  • Privacy is achieved by using a combination of legal liability on participants
• That could be two stacks - one for data in motion and one with data at rest
• Antti Kettunen pointed out that you can link a transaction to one or more verifiable credentials in order to prove authenticity
• Sam pointed out that can work, but it is based on reputational trust, because they are trusting recourse
• Legal systems only recognize reputation associated with legal identity
• The key conclusion from this is that we need to look at the layering of authenticity and confidentiality and privacy
• Sam pointed out that we have the communication stack and the priority stack
• Sam said, "The reason this is difficult is that security has always been a bolt-on, but if you want to make it critical."
• Darrell pointed out that we need to decide about the three factors. And all ZKP-system will not provide authenticity.
• Philip Feairheller said that different priorities work for different use cases.
• Antti Kettunen thanked Sam for bringing the PAC Theorem.

Drummond Reed

Jo Spencer

Square (where Daniel Buchner recently left Microsoft to join) put out this white paper called tbDEX: A Liquidity Protocol v0.1. Quote:

At its core, the tbDEX protocol facilitates the formation of networks of mutual trust between counterparties that are not centrally controlled; it allows participants to negotiate trust directly with each other (or rely on mutually trusted third-parties to vouch for counterparties), and price their exchanges to account for perceived risk and specific requirements.

•  Drummond Reed noted that it is entirely based on DIDs and VCs, but it doesn't really explain anything about the details of the tbDEX protocol
• Jo Spencer said that his background is in payments, and so this proposed protocol is "right in his wheelhouse"
  • The key problems in payment protocols are around trust—if you solve that, the payment piece is relatively easy
  • So Jo was excited when he saw this proposed protocol in terms of its scope.
  • But then he felt that it didn't actually fix the problem—it starts, but then it doesn't finish.
• Tim said that first, we saw money move away from the government space, and now we're seeing identity moving away from the government space
  • The Bitcoin lightning protocol is a good example.
  • Tim believes now that digital assets like Bitcoin are starting to become legitimized
  • This is bringing the decentralized ingredients that are necessary: DIDs, DLTs, smart contracts
  • This means that you can create a system that works totally outside of the domain of the state
  • What excited Tim about the paper was that it brought in DIDs for peer-to-peer interactions that can still be secure, and to exchange VCs for trust, and now to trade with one another
  • If we can formalize this is the work we're doing here, then we have the potential to put together a policy framework for it
  • It will very interesting geopolitically to see how this plays out.
• Jo and Tim felt that CBDCs are going to have to co-exist with non-state currencies
  • Tim feels that CBDC's won't be that different than stable coins
  • Some of the assumptions we've had post WW2 are changing.
  • 10+ year play
• Sam: 
  • Raised "reputation economy" - where you ditch money and move to exchanging value.
  • in-person requires less trust in the system as you're in person - but going remote requires reputation
• Jo - the tbDEX tries to do too much (Darrell agrees)

• Daniel Hardman will be returning to Utah over the holidays
• Drummond Reed is thinking of making a trip down to Utah to meet with Daniel, Sam Smith, Phil Windley, and other architects to talk about DIDComm, KERI, and the ToIP Technology Architecture Specification

Holiday meeting schedule:

• No meetings Dec 23 or Dec 30th
• Resume meetings Jan 6 2020

ACTION ITEM: ALL to review and consider Sam Smith's slide deck about the PAC Theorem.

ACTION ITEM: Review the Square white paper on the tbDEX: A Liquidity Protocol v0.1.