path: root/presentations/politics/riksbank.tex

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% Adapt title information
% =======================
\title{GNU Taler \\ Payments for the Common Good}
\institute{Taler Systems SA}
\author{Dr. Christian Grothoff \& Leon Schumacher}
\date{22.2.2018}

% Some common packages
% ====================
\usepackage{units}
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\usepackage{epsf}
\usepackage{epsfig}
\usepackage{fixmath}
\usepackage{wrapfig}


 \usetikzlibrary{snakes}


\begin{document}

\begin{frame}
  \begin{center}
    GNU Taler: Payments for the Common Good

%    \includegraphics[width=0.66\textwidth]{logo-2017-fr.pdf}
    \includegraphics[width=0.66\textwidth]{taler-logo-2017.pdf}
  \end{center}
\begin{textblock*}{4cm}(.5cm,7.5cm) % {block width} (coords)
  {\Large {\bf \url{taler.net}} \\
%    IRC{\bf \#taler} \\
%   {\small (on freenode)} \\
    twitter@taler \\
    mail@taler.net }
\end{textblock*}

 \begin{textblock*}{4cm}(10cm,7.5cm) % {block width} (coords)
  \includegraphics[width=2cm]{ashoka.png}
\end{textblock*}
\end{frame}


% Organization / Supplier

\begin{frame}
\frametitle{Organization}
\begin{center}
\begin{tikzpicture}
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 \node (cg) [def,orange,above=of origin,draw]{CG};
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 \node (bfh) [def, draw, below =of ue]{BFH};

 
  % grouping invividuals
  \node[def,draw,orange,fit=(ls)(mw)(fd)(jb)(ue)(ms)(bl)](group){};

  % comment right 
%  \draw[line width=1pt,orange,decorate,decoration={amplitude=7pt,brace}]
%  (group.north east) -- (group.south east);
%  \node[right=of group,anchor=center,rotate=90]{Implementation partners};

  
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 %\draw [->, C] (ls) -- (bl) node [midway, above, sloped] (TextNode) {};
 \draw [<-, C] (cg) -- (gnu) node [midway, above, sloped] (TextNode) {};
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 \draw [<-, C] (jb) -- (inria) node [midway, above, sloped] (TextNode) {};
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 \draw [<-, C] (ls) -- (pep) node [midway, above, sloped] (TextNode) {};
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 \draw [<-, C] (bl) -- (pepf) node [midway, above, sloped] (TextNode) {};
\end{tikzpicture}
\end{center}
\end{frame}


\begin{frame}
\frametitle{Dr. Christian Grothoff}
\begin{itemize}
\item Co-founder of Taler Systems SA
\item 16+ years of experience in network security and privacy
\item Software deployed in millions of computers and devices
\item PhD in Computer Science, from UCLA, degrees in Mathematics and Chemistry
\item GNU maintainer, GNU advisory board member
\item Ashoka fellow, former Emmy-Noether scholar
\item Lived and worked in USA, Germany, France and Switzerland
\item Professor for network security at University of Applied Sciences, Bern
\end{itemize}
\end{frame}


\begin{frame}
\frametitle{Leon Schumacher}
\begin{itemize}
\item Co-founder of Taler Systems SA
\item Co-founder of p$\equiv$p Security / pretty Easy privacy
\item Founder of DigitalEklo
\item Former Group CIO of Novartis
\item Former Group CIO ArcelorMittal
\end{itemize}
\end{frame}


\begin{frame}
  \frametitle{Senior Team \hfill \& \hfill advisory board \hfill}
  \begin{minipage}{5cm}
    \setlist[description]{leftmargin=1cm,labelindent=0cm}
    \begin{description}
 \item[Leon Schumacher]\ \\ co-founder, executive
 \item[Dr. Christian Grothoff]\ \\ co-founder, executive
 \item[Michael Widmer]\ \\ Lawyer, executive
 \item[Dr. Jeff Burdges]\ \\ PostDoc
 \item[Florian Dold]\ \\ PhD Student
    \end{description}

\end{minipage}
  \begin{minipage}{5.5cm}
 {\tiny
\begin{description}
 \item[Prof. Mikhail Atallah] \ \\
   Cryptographer, co-founder
   Arxan Technologies Inc.
 \item[Prof. Roberto Di Cosmo] \ \\
   Director IRILL
 \item[Greg Framke] \ \\
   CIO Manulife, \\
   former COO Etrade
 \item[Ante Gulam] \ \\
   Global Head of Information Security --- CISO \\
   MetaPack Group
 \item[Dr. Richard Stallman]\ \\
   Founder of the \\ \mbox{Free Software movement}
 \item[Chris Pagett] \ \\
   former Group Head Security/ \ \\
   Fraud/Geo Risk HSBC
 \item[Prof. Alex Pentland] \ \\
   MIT Media Lab
\end{description}
}
\end{minipage}
\vfill
\includegraphics[height=0.1\textwidth]{team-images/leon-schumacher.jpg}    \hfill
\includegraphics[height=0.1\textwidth]{team-images/christian-grothoff.jpg}\hfill
\includegraphics[height=0.1\textwidth]{team-images/michael-widmer.jpg}\hfill
\includegraphics[height=0.1\textwidth]{team-images/jeff-burdges.jpg}\hfill
\includegraphics[height=0.1\textwidth]{team-images/florian-dold.jpg}\hfill
\includegraphics[height=0.1\textwidth]{board-images/mja.jpg} \hfill
\includegraphics[height=0.1\textwidth]{board-images/roberto-di-cosmo.jpg}    \hfill
\includegraphics[height=0.1\textwidth]{board-images/greg-framke.jpg}    \hfill
\includegraphics[height=0.1\textwidth]{board-images/ante-gulam.jpg} \hfill
\includegraphics[height=0.1\textwidth]{board-images/alex-pentland.jpg}
%\note{Advisory board still under construction.}
\end{frame}


\begin{frame}
\frametitle{History of Taler Systems SA}
\begin{itemize}
\item Software development started at TU Munich (2013)
\item Grant from Renewable Freedom Foudation to develop core system (2014-2017)
\item Inria decision to create startup in (2015)
\item Company founded 2016 by Dr. Christian Grothoff and Leon Schumacher
\item Copyright agreement with Inria, GNUnet e.V. and other stakeholders (2017)
%\item Swedish community member informs us about e-Krona project (9'2017)
%\item First hire from former Inria team (2018)
\item Core team assisted by many volunteers ($\Rightarrow$ easy to grow)
\end{itemize}
\end{frame}


% ``References and experience within the field''
\begin{frame}
\frametitle{Strategic partners}
\begin{itemize}
\item GNU Taler: We are a GNU package within the GNU project
\item Hacker community: supported by CCC, Tor project, Enigmail, GnuPG, Nitrokey, etc.
\item Ashoka: Prof. Grothoff is part of a global network of social entrepreneurs
\item p$\equiv$p: Taler partners with pEp for e-mail integration
\item Roots in academia: partners at TUM (I8), Inria (TAMIS team), ETH Zurich (Helbing) and MIT (Media Lab)
\item Roots in industry: Leon Schumacher, Group CIO of ArcelorMittal \& Novartis
\item Roots in banking: Michael Widmer, Chief of Staff of Adecco Group; Bank Gutenberg, AIG, EUREX, Chicago Board of Trade/Eurex Alliance
\end{itemize}
\end{frame}


\section{What is GNU Taler?}
\begin{frame}{What is GNU Taler?}
  \vfill
  \begin{center}
GNU Taler is an electronic instant payment system.
  \end{center}
  \begin{itemize}
  \item Uses electronic coins stored in {\bf wallets} on customer's device
  \item Think electronic {\bf cash}, with a few twists
  \item Pay in {\bf existing currencies} (i.e. EUR, USD, BTC)
%    or use it to create new regional currencies
  \end{itemize}
  \vfill
  \begin{center}
    Taler is {\bf not} a cryptocurrency.
  \end{center}
\end{frame}


\begin{frame}
\frametitle{GNU Taler Overview}
\begin{center}
\begin{tikzpicture}
 \tikzstyle{def} = [node distance= 5em and 6.5em, inner sep=1em, outer sep=.3em];
 \node (origin) at (0,0) {};
 \node (exchange) [def,above=of origin,draw]{Exchange};
 \node (customer) [def, draw, below left=of origin] {Customer};
 \node (merchant) [def, draw, below right=of origin] {Merchant};
 \node (auditor) [def, draw, above right=of origin]{Auditor};

 \tikzstyle{C} = [color=black, line width=1pt]

 \draw [<-, C] (customer) -- (exchange) node [midway, above, sloped] (TextNode) {withdraw coins};
 \draw [<-, C] (exchange) -- (merchant) node [midway, above, sloped] (TextNode) {deposit coins};
 \draw [<-, C] (merchant) -- (customer) node [midway, above, sloped] (TextNode) {spend coins};
 \draw [<-, C] (exchange) -- (auditor) node [midway, above, sloped] (TextNode) {verify};

\end{tikzpicture}
\end{center}
\end{frame}
% Demo here


\begin{frame}
\frametitle{Components in Depth}
\begin{itemize}
\item Exchange: payment service provider
  \begin{itemize}
  \item Wire plugins: integration with register based system
  \item Database plugins: persist cryptographic proofs
  \item Auditor: verifies correct operation
  \end{itemize}
\item Wallet: customer user interface
  \begin{itemize}
  \item Browser extension
  \item E-mail client integration (future work)
  \item NFC payments (future work)
  \end{itemize}
\item Merchant: shop
  \begin{itemize}
  \item Front end (custom)
  \item Backend (RESTful service, performs cryptography)
  \item Backend database: persists cryptographic proofs
  \item Back office Web service: access to business data
  \end{itemize}
\item Protocol specification (generally JSON-based)
\end{itemize}
\end{frame}



% ``References and experience within the field''
\begin{frame}{Hardware requirements}
\begin{itemize}
\item[@] Exchange:
  \begin{itemize}
    \item high-availablility data center (with replicated database),
    \item expected amortized average transaction costs $\approx$ \EUR{0.000001}
    \item transaction latency $\approx$ network RTT
  \end{itemize}
\item[@] Merchant:
  \begin{itemize}
  \item database to store contracts and cryptographic proofs
  \item minimal CPU, hardware and bandwidth requirements
  \item integration cost small due to reusable backend and backoffice components
  \end{itemize}
\item[@] Customer:
  \begin{itemize}
  \item database (IndexedDB) to store coins, contracts and cryptographic proofs
  \item minimal CPU, hardware and bandwidth requirements
  \item DesignShift estimated \EUR{300,000} cost for design of
        mass production ready \EUR{10} NFC hardware wallet in CC format
  \end{itemize}
\end{itemize}
\end{frame}


% ``References and experience within the field''
\begin{frame}{Availability / Reliability / Off-line transactions}

  {\bf CAP theorem:}
\begin{center}
  Consistency, Availability, Partition-Tolerance: pick two!
\end{center}
\vfill
\begin{itemize}
\item By default, Taler focuses on consistency and detects double-spending online \\
      $\Rightarrow$ Network partitions impact availability
\item Sharing coins via NFC while offline in principle possible \\
     $\Rightarrow$ Double spending detected late, receiver may be defrauded
\end{itemize}
\vfill
\end{frame}


\begin{frame}{Security}
\begin{itemize}
\item Each party must keep their private keys secure
%\item Private keys are never disclosed by the protocol (not even during payments)
\item Losses are by design with party where keys were compromised
\item Losses are bounded to:
\begin{itemize}
\item amount of coins carried in wallet (for consumer)
\item volume of transactions during compromise (for merchant)
\item amount of coins in circulation (for exchange)
\end{itemize}
\item Denomination key expiration used to limit risk
\item Exchange operator typically has escrow account matching issued coins
\end{itemize}
\end{frame}


\begin{frame}{Scalability}
  \begin{block}{By design}
  For exchange operator:
 \begin{itemize}
  \item linear scalability (via sharding) of database
  \item linear scalability of cryptographic operations
 \end{itemize}
 System also supports having multiple exchange operators.
  \end{block}
  \begin{block}{Implementation limitations}
    \begin{itemize}
    \item Auditor implementation is currently sequential
    \end{itemize}
  \end{block}
  All components are {\em free software} with {\em public specifications}.
\end{frame}


\begin{frame}{Interoperability}
 \begin{itemize}
  \item Database layer abstracted via interface
  \item Wire transfer layer abstracted via interface
  \item Open protocol specification
  \item RESTful JSON-based APIs
  \item Designed to operate well with HTTP(S)
  \item Recent changes to better support Apps and non-WebExtension compatible browsers
  \item Core logic implemented in portable C code (exchange, merchant backend)
  \item Wallet-specific logic implemented in TypeScript \\
        ($\Rightarrow$ WebExtensions, React)
 \end{itemize}
\end{frame}


\begin{frame}{Reliability}
 \begin{itemize}
  \item Cryptographic constructions are well-understood
  \item Cryptographic primitives are state-of-the art
  \item Protocols have been peer-reviewed by various cryptographers
  \item State-of-the-art secure software development process
  \item Implementation has been (partially) subjected to security audits, more planned
  \item World-class information security team
 \end{itemize}
\end{frame}


\begin{frame}{Anonymous transactions}
\begin{itemize}
\item Customer must identify when withdrawing via register system (KYC)
\item Merchant must identify to receive via register system (AML)
\item Merchant can be compelled to disclose terms of contract
\item Customer can be {\em anonymous} when paying
\item Multiple transactions of same customer are {\em unlinkable}
\item Customer has proof of purchase
\item Customer can voluntarily disclose identity, but not be compelled
\item Exchange operator must be well-known and certified by auditor
\item Auditor keys usually hard-coded in customer and merchant software
\end{itemize}
\end{frame}


\begin{frame}{Identity Management}
 \begin{itemize}
  \item Taler provides electronic cash on top of register-based system
  \item Typically, customer and merchants have accounts in register-based system \\
        $\Rightarrow$ Identification piggy-backs on register-based system
  \item Customer's wallets have a key to identify them
  \item Possible to send electronic coins to customer based on wallet key \\
        $\Rightarrow$ Possible to provide {\em welfare} to unbanked individuals
  \item Receiving Taler payments requires account in register (for taxability)
 \end{itemize}
\end{frame}


\begin{frame}{Accessibility}
 \begin{itemize}
 \item Anyone can customize wallet, as {\em protocols} enforce security!
 \item Wallets (HW, SW) will be customized to
       match accessibility requirements (children, disabled, elderly)
 \item Prototype was publicly demonstrated and explained by 10 year
       old kid at hacker conferences (videos available)
 \item Transaction speed is one click plus network RTT
 \item Avoiding customer authentication improves privacy and usability!
 \item Advisory board voiced ethical concerns with payments becoming
       too easy and need to integrate financial education with wallet.
 \end{itemize}
\end{frame}


\begin{frame}{Social Impact of Taler}
  \begin{center}
    \includegraphics[height=0.8\textheight]{social-impact.pdf}
  \end{center}
\end{frame}


\begin{frame}
    \frametitle{Possible outcomes (optimistic)}
    \begin{itemize}
        \item{Replace Mastercard/Visa/Paypal online} \\
              $\Rightarrow$ Cheaper transactions $\equiv$ 3\% reduction in VAT
        \item{Replace cash and credit cards} \\
              $\Rightarrow$ Faster business transactions in stores
        \item{Income via Taler is easily tracked by the government} \\
              $\Rightarrow$ Less corruption, less tax evasion possible
        \item{Nobody can track how you spend your money} \\
          $\Rightarrow$ Privacy for citizens! \\
          $\Rightarrow$ Industrial espionage defense for business!
    \end{itemize}
\end{frame}


\begin{frame}{}
  \vfill
  \begin{center}
    {Why should {\em Riksbank} be interested?}
  \end{center}
  \vfill
  \begin{center}
  \includegraphics[height=3cm]{illustrations/usmint.jpeg}
  \end{center}
  \vfill
  \begin{center}
    {Why not do {\em online} what they do {\em offline}?\footnote{Just better: you can anonymously receive cash, but not Taler coins.}}
  \end{center}
\end{frame}


\begin{frame}{Greatest challenges for Taler Systems SA}
\begin{itemize}
 \item Onboarding of customers \& merchants
 \item Banking license \& integration with register-based system
% \item Funding for non-proprietary (FLOSS) software to establish a
%   payment systems commons without patents
 \end{itemize}
\end{frame}


\begin{frame}{PoC project}
 \begin{itemize}
 \item Taler Systems SA as technological solution provider (expertise)
 \item Riksbank as operator (escrow account, data center, RIX link)
 \item Key steps:
   \begin{itemize}
   \item Agreement on costs and responsibilities for PoC (1 M)
   \item Define specifications for small PoC / demonstrator (1 M)
   \item Setup PoC (1 M)
   \item Satisfy Riksbank technical security and performance requirements (6-12 M)
   \item Identification of niche market and partners for public PoC launch (4-6 M)
   \end{itemize}
 \end{itemize}
\end{frame}



\begin{frame}
  \begin{center}
%    \includegraphics[width=0.66\textwidth]{logo-2017-fr.pdf}
    \includegraphics[width=0.66\textwidth]{taler-logo-2018.pdf}
  \end{center}
  \vfill
  \hfill A GNU package
\end{frame}

\end{document}


\section{Comparison}
\begin{frame}{Comparison}
  \begin{center} \small
    \begin{tabular}{l||c|c|c|c|c}
                & Cash & Bitcoin & ZCash    & Creditcard & GNU Taler \\ \hline \hline
    Online      &$-$$-$$-$  &   ++    &    ++    &     +      &   +++  \\ \hline
    Offline     & +++  &   $-$$-$    &    $-$$-$    &     +      &   $-$$-$  \\ \hline
    Trans. cost & +    & $-$$-$$-$   & $-$$-$$-$  &     $-$      &   ++  \\ \hline
    Speed       & +    & $-$$-$$-$   & $-$$-$$-$  &     o      &   ++  \\ \hline
    Taxation    & $-$    &   $-$$-$    &  $-$$-$$-$   &    +++     &  +++  \\ \hline
    Payer-anon  &  ++  &   o     &    ++    &  $-$$-$$-$   &  +++  \\ \hline
    Payee-anon  & ++   &   o     &    ++    &  $-$$-$$-$    &  $-$$-$$-$ {\bf (*)} \\ \hline
    Security    &  $-$   &   o     &    o     &    $-$$-$      &  ++   \\ \hline
    Conversion  & +++  &  $-$$-$$-$   & $-$$-$$-$ &    +++     &  +++  \\ \hline
    Libre       &  $-$   &  +++    &    +++   & $-$ $-$ $-$      &  +++  \\
  \end{tabular}
  \end{center}
  {{\bf (*)} Not having payee-anonymity is a good thing as otherwise money laundering
    becomes a real problem.}
\end{frame}




\section{The Problem}
\begin{frame}{The Problem}

  3D secure (``verified by visa'') is a nightmare:
  \begin{minipage}{5cm}
    \begin{itemize}
    \item Complicated process
    \item Shifts liability to consumer
    \item Significant latency
    \item Can refuse valid requests
    \item Legal vendors excluded
    \item No privacy for buyers
     \end{itemize}
  \end{minipage}
  \begin{minipage}{5cm}
      \includegraphics[width=\textwidth]{illustrations/cc3ds.pdf}
  \end{minipage}
  \vfill
    Online credit card payments will be replaced, but with what?
\end{frame}


\begin{frame}{The Problem}
\vfill
  \begin{textblock*}{12cm}(0.5cm,1cm) % {block width} (coords)
    \begin{itemize}
    \item Global tech companies push oligopolies
    \item Privacy and federated finance are at risk
%    \item 30\% fees are conceivable
    \item Economic sovereingity is in danger
    \end{itemize}
\end{textblock*}
\begin{textblock*}{4cm}(3.5cm,5.2cm) % {block width} (coords)
 {\includegraphics[width=\textwidth]{competitor-logos/amazon.png}}
\end{textblock*}
\begin{textblock*}{2cm}(7cm,3cm) % {block width} (coords)
 {\includegraphics[width=\textwidth]{competitor-logos/alipay.jpeg}}
\end{textblock*}
\begin{textblock*}{2cm}(3cm,3.5cm) % {block width} (coords)
 {\includegraphics[width=\textwidth]{competitor-logos/paypal.jpeg}}
\end{textblock*}
\begin{textblock*}{2cm}(9cm,5cm) % {block width} (coords)
 {\includegraphics[width=\textwidth]{competitor-logos/applepay.jpeg}}
\end{textblock*}
\begin{textblock*}{2cm}(7.5cm,5.9cm) % {block width} (coords)
 {\includegraphics[width=\textwidth]{competitor-logos/samsungpay.jpeg}}
\end{textblock*}
\begin{textblock*}{1cm}(9.5cm,6.3cm) % {block width} (coords)
 {\includegraphics[width=\textwidth]{competitor-logos/android_pay.png}}
\end{textblock*}
\vfill
\end{frame}