Enabling interoperable chat to non-nerdy friends is basically Matrix's raison d'être. We're not there yet (see https://matrix.org/blog/2016/07/04/the-matrix-summer-special... for the current status), but if we don't provide it we will have failed in the whole mission to defragment these silos, letting users choose which service to trust without losing interoperability.
The good news is that the Olm end-to-end cryptographic ratchet that Matrix is in the process of deploying (https://matrix.org/git/olm) is built using the same algorithms as Signal Protocol's ratchet (although it's an independent implementation) - so we're hopeful that at least technically the window is open in future for using Matrix to defragment all the services who have adopted Signal Protocol (WhatsApp, Google Allo, FB Messenger, Signal itself etc) without compromising the E2E privacy. Right now this is total sci-fi, and won't likely happen (whilst preserving E2E crypto) without cooperation from FB, Google etc.
However, we hope to get Matrix to the point where they see that the longer term benefits of participating in a healthy open ecosystem outweigh the short term benefits of trying to lock users into a silo - just as email eventually interoperated over the early internet. That's a while off, but this is still the goal.
The best way to make sure this happens is to play with Matrix in its current form, and help us write bridges (e.g. https://github.com/matrix-org/matrix-appservice-bridge/blob/...) to interface as many silos as possible into Matrix. The more bridges, the more useful Matrix is, and the higher the chance of building an ecosystem which eventually Google, FB and friends will find attractive.
Thanks a lot for your work on Matrix. It is definitely one of the projects (like Syncthing, IPFS or GNU Social) that gives me enough hope to not run to the caves so early :)
On the serverside (which may be "local" depending on where your server is running), the history for the rooms you participate in is stored as a matter of course. Matrix operates by replicating that history between the servers participating in the conversation. If that history is e2e encrypted, any device with the necessary cryptographic ratchet state can decrypt it. (Note that rooms may be configured to change ratchet frequently to deliberately stop history being decrypted multiple times, providing a form of PFS).
On the client side, it depends on the client you're using. Many native Matrix clients and many bridged clients give the option to store local history (whether it was originally encypted or not). Smarter clients will store it encrypted at rest by whatever mechanisms the OS and hardware provides.
The good news is that the Olm end-to-end cryptographic ratchet that Matrix is in the process of deploying (https://matrix.org/git/olm) is built using the same algorithms as Signal Protocol's ratchet (although it's an independent implementation) - so we're hopeful that at least technically the window is open in future for using Matrix to defragment all the services who have adopted Signal Protocol (WhatsApp, Google Allo, FB Messenger, Signal itself etc) without compromising the E2E privacy. Right now this is total sci-fi, and won't likely happen (whilst preserving E2E crypto) without cooperation from FB, Google etc.
However, we hope to get Matrix to the point where they see that the longer term benefits of participating in a healthy open ecosystem outweigh the short term benefits of trying to lock users into a silo - just as email eventually interoperated over the early internet. That's a while off, but this is still the goal.
The best way to make sure this happens is to play with Matrix in its current form, and help us write bridges (e.g. https://github.com/matrix-org/matrix-appservice-bridge/blob/...) to interface as many silos as possible into Matrix. The more bridges, the more useful Matrix is, and the higher the chance of building an ecosystem which eventually Google, FB and friends will find attractive.