The onion encoding scheme has finally reached a point where the message layers are now all encoding and decoding nicely in tests. The compound onion message types will be tested soon, and the core message encoding scheme will be complete.
We now have another pair of hands on the task, he is beginning the implementation of the p2p services, the beginnings of a network simulator and test harnesses are beginning. We are on track to see a proof of concept ready to run by the end of February.
The white paper has been dramatically improved and refined, the protocol specification is nearly complete.