DD 36: Currency conversion service ################################## Summary ======= This document explains the design of the currency conversion service. Such service enables customers to spend their fiat currency to buy Taler coins in a regional currency, and enables merchants to cash-out from the regional currency to fiat. Motivation ========== The conversion service (CCS) is fundamental for a regional currency and is missing in the Taler/Libeufin ecosystem. Definitions =========== *Fiat-issuer* is the fiat bank account that belongs to the regional currency issuer; typically, such bank account belongs to one association that runs the infrastructure. This bank account is hosted at the "fiat bank". *Regio-issuer* is the bank account that belongs to the local currency issuer but hosted at the bank that generates the regional currency. Such bank is also called "circuit bank". *Regio-exchange* is the bank account that belongs to the Taler exchange and that is hosted at the circuit bank. *Fiat-target* is a bank account hosted in the same currency of fiat-issuer and that belongs to a customer who initiated a cash-out operation. *Regio-user* is a bank account hosted at the circuit bank that is different from regio-issuer. *Fiat-customer* is a bank account hosted in the same currency of fiat-issuer, typically owned by customers that want to withdraw Taler coins in the regional currency. Requirements ============ * CCS must not impact the libeufin-nexus structure. * CCS must trigger Taler withdrawls every time a customer buys the regional currency ('cash-in' operation). * CCS must offer cash-out operations. * CCS should react as soon as possible to cash-in and cash-out operations. * CCS must show its state to administrators and offer management tools. * CCS must link every fiat-side of a cash-out to its regional currency counterpart. In particular, because every cash-out starts with a payment *P* from regio-user to regio-issuer and ends with another payment *Q* from fiat-issuer to fiat-target, CCS must link P and Q. Proposed Solution ================= The following design assumes that CCS is coded in libeufin-bank and that libeufin-bank and libeufin-nexus share the same database with separate schemas. The solution relies on SQL triggers to atomically synchronise cash-in and cash-out operations between the two schemas. SQL triggers and conversion operations -------------------------------------- Libeufin-bank controls the conversion support and sets up or removes conversion SQL triggers when necessary. In order for the SQL triggers to perform the conversion operations, the configurable rates/fees are stored in the database and the conversion operations are performed using stored SQL procedures. The SQL triggers and conversion procedures are stored in the libeufin-bank schema. Cash-out operation ------------------ Libeufin-bank learns instantly about a cash-out operation, because it's *the* service offering such feature. Therefore, as soon as a cash-out operation gets TAN-confirmed, libeufin-bank performs a wire transfer from regio-user to regio-issuer by specifying the amount without any rates/fees applied. Along the same database transaction, a SQL trigger store the *instructions* of another payment *P* from fiat-issuer to fiat-target, but this time **with** the cash-out rates/fees. Asynchronously, a libeufin-nexus background task picks P and sends it to the fiat bank. Finally, fiat bank conducts P and fiat-target receives the wanted amount. The same libeufin-nexus background task should also retry previous payments like P that failed to be submitted to fiat bank. Cash-in operation ----------------- A cashin-in operation starts as soon as the customer sends a fiat payment from fiat-customer to fiat-issuer. The libeufin-nexus component is responsible to query the fiat bank via EBICS every X seconds. X should match the tightest interval allowed by the bank. When libeufin-nexus registers an incoming payment on fiat-issuer in the database, a SQL trigger applies the **current** cash-in rates/fees and performs a wire transfer from regio-issuer to regio-exchange. Libeufin-bank makes the exchange aware via the Taler Wire Gateway API and from now on, the system proceeds like it always did in Taler.