Free, Real-time Gross Settlement system (RTGS) for everyone, with a mobile phone.

Today, "money" is a in all cases a bag of bits within a computer system, gone are the days of bank vaults, guards or burglar alarm systems. Money is today sent for close to zero incremental cost between computers. The real costs involved in monetary payments, is securing the 100+ year old double entry accounting systems, and the mass of clerks and auditors who keep  "payment systems" and decade old payment networks like SWIFT running, and manage the risks associated with any losses. To be fair there is a "significant" regulatory cost imposed on banks, and payment systems as well, but these do not match the excessive payment fees which exist today, this is what creates the opportunity. If existing financial institutions offered a free payment service, or close to costs, once they isolated or upgraded their old world insecure accounting systems, than a new global service would get wind in its sails. The system proposed herein is the next generation of Real-time Gross Settlement Systems (RTGS) where all transactions are atomic, instantaneous and irreversible, and have the ability to execute in a distributed orchestrated data and processing environment, including P2P, even if the P2P is not the most likely first commercially deployable option.

Back to reality
An observation; there is "significant" amounts of money going into bitcoin related "block chain" activities, which will never become "verbs" such as to "Google" to "Xerox". There is no truly disruptive technologies evident in this space, which is probably not surprising given the focus on banks and their involvement combined with the massive amounts of profits made from processing payments today. A free payments system is simply not on anyone's agenda, it is typical to see recent graduates as heads of Banking block chain groups, or it is a part time activity for the non executive banking staff..

Like most entrepreneurs, one looks to the "big vision" which can "change the world", and make life better for all. Making money comes as a by product of achieving the "vision" or getting as close as possible, a fundamental different view of the world from the typical banking executive.

The Bill Gates foundation has spend billions trying to solve third world health problems, such a malaria, a free payments system which creates wealth for individuals, can more effectively address third world health issues, than any cure. Poverty unpins many third world heath problems.

There is a saying "Teach a man to fish and he can feed his family forever" in this case enabling third world populations to securely participate in the global economy, we envisage will bring lasting change for the better for everyone. The "Vision"..

Hence if payments, are the focus, rather than a total "Block Chain Ledger for Everything" solution, a vision which is consistent and a subset of the Secure Block Chain Ledger Vision, is a world with a fully decentralised and totally free payments system which is available to anyone who has only a mobile phone.






If one looks at the bitcoin network, it by design drives up the cost of a each transaction, some say its sits at ~$10 per transaction today, totally the wrong approach, its this basic.

Considering the references listed below, if one combines "triple entry accounting", the Private and Public Block Chain Ledgers and Secure Identification Numbers(SIN), and lastly BlockAuth then the implementation of a secure payments system becomes very simple, especially as almost all of the technologies required exist as freely available software today. To support a wide range of eCommerce, the same protocol supports orders and invoicing as well as payments, the two should not be separated.

As all public Block Chain Ledger entries are atomic and instantaneous, and in reality have close to zero incremental cost, then all payments should also be free, this underpins the vision.
We expect the wide availability of free payments, to have the potential to increase the GDP of many third world individual and countries, and lead to an improvement in the wealth of  all.

Today Cloud Accounting for sole traders, and Superannuation Funds is free, no-one needs to pay for accounting software, why not free payments as well.

This result will be truly disruptive to the existing old world, when combined with a fully decentralised Public Block Chain Ledger, and secure payment protocols, making use of the almost universally available global mobile phone platform and free software.

Key Features

• All payments less than a threshold, say $10,000 are Free
• Real-time, atomic, cryptographically secured, fully decentralised Public Block Chain Ledger, participating in a "Triple Entry" accounting ledger protocols.
• Explicit for FX transactions as required, no explicit gateways or exchanges required.
• All transactions appear instantly on the distributed distributed Public Block Chain Ledger
• Requires only a mobile device, with internet access,lightweight data usage
• Suitable for both first and third world participants, bring into the commercial world the existing disenfranchised populations.
• Supports payments to and between individuals who lack first world bank accounts or  identification
• Based upon well known double entry accounting systems, with addition of secure Block Chain Ledger technologies. Private Block Chain Ledgers do not need a single or standard technology solution set, only that they can publish and participate in supporting the global distributed Public Block Chain Ledger protocols
• Reuse of as much bitcoin technologies and available free software as possible
• No bank account required
• Saleable from micro payments though to any value, recognising there may be additional measures required to address additional risks or compliance requirements.
• Supports anonymous and non anonymous payments via SIN and SIN attributes.
• Non anonymous SIN required for all transaction amounts above $10,000.
• Support for commercial Orders and Billing within common payments protocols
• Any taxation is held within the Private Block Chain Ledgers, all payments are considered tax free as is the case today.
• Makes use of IMEI within Mobile device SIM cards.
• Practical unlimited value, is capable of being held within the distributed Public Block Chain Ledger, there is no hard protocol limits as there are no limits within the underlying double entry accounting systems. No wealth or money is created within the Public Block Chain Ledger or payments system.

What about Banks
What do financial institutions want?  Cryptographically verifiable settlement and clearing systems that are globally distributed for resiliency and compliant with various reporting requirements.

What role would banks play in a distributed free value transfer world?
Banks can continue with their existing functions, especially in the early stages, but are not a fundamental element of the solution space, especially for sub $10,000 value transactions with SMEs involved in  B2B, C2B and C2C type payments. In fact banks can use these same underlying technologies to bring their own ledgers into the modern digital world we all live in.

They also play a role in the Secure Identification Number (SIN), when there is a requirement for non-anonymous attributes being applied to the SIN, to support a range of commercial payments and regulatory frameworks, but like above this is not a mandatory element of the solution. And other providers will appear over time, like market place "ratings ect) all variations of SIN attributes are supported. One of the objectives is to support payments from people who have no bank accounts and no first world identification today, and are locked out participating in global eCommerce today.
The one palce that banks will still maintain an dominant position is the supply of "cash" most likely via ATM's for the various local communities, we don't envision the total replacement of "cash" and do not see anyone removing the dominance and convenience of ATMs, we would hope that they can be integrated into the free payments network, even if "cash" dispensing will probably never be free.

Banks also have significant risk management expertise, and in many cases this is a requirement of a successful transaction, especially as the transaction value increases.

But banks are optional parties within any payment transaction, it is the participants choice, in any decentralised solution, Opt-in is always the prim objective.

Why Mobile Phones
In many third world countries, without any banking or credit card systems the only technology that exists is a mobile phone.

Many of these countries rely almost entirely on services like "Western Union" to provide universal basic and not free money transfer and payments, western union is the practical "currency" in many countries.

Many developing countries have encouraged mobile phone companies to invest in infrastructure, the story of a home without any electricity, but with a solar charger for their mobile phone is not something unique today. Hence it is an obvious choice to base any global universally available payments system on this infrastructure.

Why the existing RTGS system is broken and cannot get anywhere close to FreeThe answer is obvious refer to the figure below, its nowhere close to KISS..

The Solution, Key Technologies

1. Hardware secured and protected ECDSA, and ECDH keys and key chain ( July 2015)
2. Secure Wallets on mobile devices (mostly available free today, just needs linkage to hardware key chain above).
3. Secure Private Block Chain Ledger (available today)
4. Secure Public Block Chain Ledger (available today)
5. Secure Identification Number(SIN) (complete infrastructure operational today)
6. SIN attributes for non anonymous  transactions (available today)
7. BYOD management for device compromise (available today)
8. BitAuth between key chain and mobile device ( available today)
9. Scaleable, algorithm agile eco-system (available today)
10. Payments protocol (in development)

A new and exciting word is almost here..

Reference Implementation

In the reference implementation, using a commercial hash keyed database, ~10,000 blocks per second could be processed. This is for each of the distributed PBCL nodes within the PBCL's; hence the total processing of the PBCL is practically unlimited. The reference implementation also supported ~ 5,000 read operations, this asymmetry is typical of commercial databases.  The performance is relatively independent of the number of transactions in the distributed PBCL up to the tested 1 Billion transactions. Due to the decentralised nature of the PBCL, this poses no technical transaction processing limitations, and should easily exceed any existing global payments system.

All transactions within the PBCL are atomic, instantaneous and irreversible.

Performance Comparison:

·         Bitcoin 7 tps

·         PayPal 115 tps

·         PBCL 10,000 tps for each BPCL node, unlimited across the global PBCL

·         Visa network <56,000 tps

Storage Comparison

·         Bitcoin, at very high transaction rates each block can be over half a gigabyte in size

·         PBCL typically less than 500 bytes per transaction

References
1. Free hardware generated and protected Bitcoin Private key and key-chain.
2. Identity Theft and the Digital World.
3. Triple Entry Accounting , and Block Chain Ledgers
4. BitAuth, Decentralized Authentication for the mobile digital world


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