# Announcing Offst 0.1.0 🎉🎉🎉

2019-04-25

We are glad to announce the first public release of Offst!
Offst is a decentralized payment system, allowing to pay and process payments efficiently and safely. Offst is an open source project, written in Rust, licensed under AGPL3.

You don't need a bank account, credit card, phone number or even an email address to use Offst. On the other hand, Offst currently doesn't have an interface to the traditional banking system, and therefore you can not use it yet to buy food at the grocery store.

## Warning

This release of Offst is very initial and not ready to use in production!. There are most certainly bugs in this release, and the interface and protocols will almost surely break in the next releases, so please don't move all your savings into Offst yet.

## Main features

• Efficient and quick payments. Offst does not rely on a blockchain or any kind of proof of work. Every transaction affects only a few computers in the network. Payments usually take less than a second.

• Low flat payment fees. Payment fees are determined by the length of the route on which the payment is sent. Each participant along the route gets exactly one credit.

• Fair distribution of assets: The total amount of credits in the Offst system is 0, and it is initially distributed evenly between all the participants (Read more to learn how it works)

• If you lost your key, you can talk to some friends and restore your account.

• Censorship resistant. Buy whatever you want, sell whatever you want. Offst is decentralized, and therefore no entity can block or censor payments.

• Full raw control: Offst is fully programmable and has open interface for writing applications.

## The core idea

Offst is a digital payment system based on mutual credit.

The common method of running an economy is to divide some amount of money bills between people and let them play. Usually there are some people in charge of printing more money bills or destroying money bills to keep the economy going.

Offst works in a different way.

Quoting From the documentation:

Consider Alice, who has two friends, Bob and Charli. Suppose that at the same time:

• Bob owes Alice 50 dollars
• Alice also owes Charli 50 dollars.
    (-50,+50)       (-50, +50)
Bob --------- Alice ---------- Charli



Suppose that Charli meets Bob one day, and Bob has a bicycle he wants to sell for exactly 50 dollars. Suppose also that Charli is exactly looking to buy a bicycle, and he decides to buy it from bob. In this case Charli can take the bicycle, and they both ask Alice to forget about the debts on both sides.

In a sense, Charli made a payment to Bob by asking Alice to offset the debts. No real money bills had to pass hands to make this happen.

      (0, 0)          (0, 0)
Bob --------- Alice ---------- Charli



If Bob and Charli perform these kinds of transactions very often, it is reasonable for Alice to charge for forwarding the transactions. For example, Alice could charge 1 dollar for every transaction she forwards.

Offst is a system that works this way. People or organizations can set up mutual credit with each other, and leverage those mutual credits to send payments to anyone in the network. A participant that mediates a transaction earns 1 credit.

In Offst we call two entities that have set up together mutual credit account friends.

## Setting credit limit

Suppose that Alice and Bob has a mutual credit account. Initially the account is balanced. If Bob starts buying lots of things along chains that go through Alice, eventually Bob will have a very large debt to Alice. Alice might not want that.

Why not? Alice is afraid that Bob will default on this debt one day. Maybe Alice can trust Bob with certain amount of debt, but not with too much debt.

The solution Offst offers to this trust problem is that both sides configure credit limits.

For example:

• Alice configures a credit limit for Bob: 100 credits.
• Bob configures a credit limit for Alice: 80 credits.

This means Bob can never owe Alice more than 100 credits, and Alice can never owe Bob more than 80 credits. (EDIT: Fixed thanks to nirizr)

From the point of view of Alice:

                    balance
----[-----------|-----^-------]--->
-80          0            100


(In the figure above: Alice has control over the right cap, and Bob has control over the left cap)

Conversely, By putting a limit to the maximum amount of credits Bob can owe to Alice, Alice has in fact put a limit on the maximum amount of credits it can own.

In other words: In the closed system of Alice and Bob, The richest Alice can be is 100 credits. The richest Bob can be is 80 credits.

As a corollary, the amount of trust (credit limit) a participant puts on other participants limits the amount of maximum credits the participant can own. This amount is also the maximum amount of credits a participant can lose by trusting other participants.

## The value of one credit

The basic amount of value in Offst is one credit. One credit is exactly the amount of value you earn when you help mediate a transaction.

What is the value of one credit with respect to known currencies? We are not sure yet. These are questions that we should probably let the market decide. We might be able to have some estimates though.

1 credit should not be too expensive, because usually one might need to pay a few credits 1 as a fee for sending a transaction, and nobody wants to use a payment system where the fees are too high.

On the other hand, if the value of 1 credit is too small, there is no real incentive for people to run nodes. From this side, we might conjecture that the amount of transactions mediated by one Offst node for a day should be able to cover the costs of running that node.

## Total amount of credits

All participants begin initially with 0 credits, and the total amount of credits in the system always remains 0. The reason for this is that every excess in credits in one participant is the dual of lack of credits in another participant.

## How Offst works?

The core of Offst is the credit pushing mechanism. It allows to send credits along a route of mutual credit edges in a secure way. You can read more about it in the project documentation.

Offst does not use a blockchain and does not contain any form of proof of work. In addition, Offst does not attempt to achieve a global consensus 2. Offst is very efficient. Every transaction sent using Offst only affects a few other computers in the network (according to the length of the route).

## Network topology

Offst is made of a few main services:

• Offst node (stnode)
• Offst relay (strelay)
• Offst index (stindex)

Example for part of the Offst network topology:

                  +-------+
| Index |
+-+---+-+
|   |
+-----+   +------+
|                |
+----+--+         +---+---+          +-------+
| Index +---------+ Index +----------+ Index |
+-+-----+         +-------+          +-----+-+
|                                        |
|                                        +---+
|     +-------+         +-------+            |    +-------+
|     | Relay |         | Relay |            |    | Relay |
|     +--+----+         +-+---+-+            |    +---+---+
|        |                |   |              |        |
|+-------+                |   |              |        |
|| +----------------------+   +-----------+  |+-------+
|| |                                      |  ||
/-++-+-\                                  /-+--++\
| Node |                                  | Node |
\-+--+-/                                  \---+--/
|  |                                        |
+--+  +---+                                    |
|         |                                    |
+--+--+   +--+--+                              +--+--+
| App |   | App |                              | App |
+-----+   +-----+                              +-----+



In the figure above: Two nodes can communicate using relays and find routes using index servers. Some applications are connected to the nodes.

stnode is the binary that runs the Offst node service. It is the core part of Offst that executes the credit pushing mechanism. This binary is what most users will run on their end device.

strelay is a binary that runs the Offst relay service. It is used to relay communication between nodes. The communication between nodes is end-to-end encrypted, and therefore strelay can not read the communication. Anyone can run a relay. We use relays because most users are behind one or more NATs and firewalls, and may not be able to listen for TCP connections 3.

Relay servers are a form of a network meeting point between nodes. It allows nodes to communicate. Every node must configure at least one relay server to be able to communicate with other nodes.

stindex is a binary that runs the Offst index service. It is used to index the relationships between nodes and supply routes that can be used to send funds.

Every node sends periodic information to a (preconfigured) index server about his relationship with his friend nodes. The index servers share this information with each other and use it to index the whole network.

Whenever a node wants to send funds to another node, it first queries an Offst index for a route. Then the node uses the provided route to send the funds to the remote node.

Anyone can run an index, but an index is not useful if it is not part of the index servers federation, because it will not be able to get information about the full state of the Offst network. Therefore Index server owners should configure their index servers to talk to each other.

## Offst apps

The way to communicate with Offst node is through Offst apps. Offst comes with a simple command line app called stctrl. Apps can be configured to have certain permissions. Offst Apps communicate with the Offst node using TCP communication (Capnp serialized), therefore apps can be written in any language by anyone.

An example for stctrl invocation:

\$ stctrl -I app0/app0.ident -T node0/node0.ticket info friends
+----+-------+---------------+
| st | name  | balance       |
+====+=======+===============+
| E+ | node1 | C: LR=+, RR=+ |
|    |       | B  =100       |
|    |       | LMD=150       |
|    |       | RMD=200       |
|    |       | LPD=0         |
|    |       | RPD=0         |
+----+-------+---------------+


The arguments given to stctrl are: -I: the identity of the app (Used for authentication against the node) and -T: the node ticket. The node ticket contains the node connection info. The subcommand info friends shows the list of currently configured friends.

In the example above the node has one friend (named node1), with balance of 100 credits. The local max debt (credit limit imposed by the remote node) is 150 credits, and the remote max debt (credit limit imposed by the local node) is 200 credits.

## Public relays and index servers

We set up a pair of relay servers and a pair of index servers to get you started. We include here their tickets:

It doesn't matter which ones you pick. Learn how to configure your offst node here.

## Cryptography

Offst depends on ring for its cryptographic code. Offst relies on the following cryptographic primitives:

• Diffie Hellman
• Symmetric encryption
• Cryptographic signatures
• Hash functions

All the communication is encrypted.

We chose not to rely on the traditional TLS certificates authority hierarchy because:

• It forces users to buy domain names.
• Using it could give power to a small amount of organizations to shut down Offst services.

We plan to convert all the interface related crates to the MIT license, to allow Rust developers to reuse Offst interface to write Rust applications.

Why AGPL3? Because we believe payment related code should always be open source. This is important both from security and transparency perspectives. If you have a different opinion about this subject, please send us a message.

## Future work

Offst is far from done. The following is a very general outline of what we plan to do next:

• Gathering feedback from preview release

• Offst core (stnode, stindex, strelay):

• Refactoring codebase
• Documentation
• Stabilizing Offst protocol and interfaces
• Migrating to use an sqlite3 database for node
• Security review
• Offst Applications:

• Creating a GUI desktop application. (Possibly a browser addon?)
• A mobile GUI application for Offst.

Let's start experimenting with Offst. I opened a node.

If you want to add my node as a friend, this is my friend file: real_node.friend. Remember that I have to add you as a friend too, so email me your friend file. You can find my email at the about page.

## Contributors

This is a good time to thank people who helped making Offst possible:

We welcome contributions from anyone. Don't hesitate to reach out!

1

If we believe the idea of Six degrees of separation, then the average transaction might require a fee of 6 credits.

2

Instead, only a weak form of consensus is obtained along the route where the funds are pushed.

3

In the future we can implement smarter logic that attempts to form a real p2p connection between nodes. At this point we chose the trivial and simple solution to develop.