Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
From: Adam Back [EMAIL PROTECTED] So this would be the argument for a closed supply of money in the system, like the digicash betabucks where they stated up from that they would only issue 1,000,000 betabucks. People trade them based on supply and demand. Perhaps. Though at the time Wei Dai had some arguments at the time that if they were popular, they would be a good investment and people would have an incentive to hold on to them which would make them difficult to obtain, highly inflationary, and hard to use. I have missed that one; however, it is wrong - if people hold them, then they become MORE valuable, and thus you have high deflation - the purchasing power of money grows - which is great. And if their value gets so big that subdivisions start to become necessary, one can always convert them to new betabucks, each old one being worth a million new ones. End of problem. Mark
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
I think you are assuming things about rational economic behavior when a money system is subject to high deflation. Consider during periods of high inflation people don't like holding money, as it devalues too fast. They will hold interest bearing deposits instead. During periods of high deflation, they will hold cash if it is the most attractive investment. The result will be shortage of cash, for people who actually want to use it to make purchases because investors will buy all of it. Perhaps there are some government monetary systems in history which had this problem. For example gold with sudden shortage of gold supply, or similar. Adam On Thu, Jun 06, 2002 at 05:31:28PM +0300, Marcel Popescu wrote: From: Adam Back [EMAIL PROTECTED] So this would be the argument for a closed supply of money in the system, like the digicash betabucks where they stated up from that they would only issue 1,000,000 betabucks. People trade them based on supply and demand. Perhaps. Though at the time Wei Dai had some arguments at the time that if they were popular, they would be a good investment and people would have an incentive to hold on to them which would make them difficult to obtain, highly inflationary, and hard to use. I have missed that one; however, it is wrong - if people hold them, then they become MORE valuable, and thus you have high deflation - the purchasing power of money grows - which is great. And if their value gets so big that subdivisions start to become necessary, one can always convert them to new betabucks, each old one being worth a million new ones. End of problem. Mark
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
From: Adam Back [EMAIL PROTECTED] Consider during periods of high inflation people don't like holding money, as it devalues too fast. They will hold interest bearing deposits instead. Agreed. During periods of high deflation, they will hold cash if it is the most attractive investment. The result will be shortage of cash, for people who actually want to use it to make purchases because investors will buy all of it. Right. And a shortage of anything, cash making no exception, is solved automatically (if the market is left alone). The value of a monetary unit will rise until its price will be considered (by the cash holders) high enough - that is, until they will value something else more than the cash. Shortages are NEVER a problem if the market is left alone to clear it - they simply indicate an undervaluation of the commodity. Perhaps there are some government monetary systems in history which had this problem. For example gold with sudden shortage of gold supply, or similar. Once you put the gov't into the equation, all bets are off :) Mark
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
I think you are assuming things about rational economic behavior when a money system is subject to high deflation. Consider during periods of high inflation people don't like holding money, as it devalues too fast. They will hold interest bearing deposits instead. During periods of high deflation, they will hold cash if it is the most attractive investment. The result will be shortage of cash, for people who actually want to use it to make purchases because investors will buy all of it. Perhaps there are some government monetary systems in history which had this problem. For example gold with sudden shortage of gold supply, or similar. Adam On Thu, Jun 06, 2002 at 05:31:28PM +0300, Marcel Popescu wrote: From: Adam Back [EMAIL PROTECTED] So this would be the argument for a closed supply of money in the system, like the digicash betabucks where they stated up from that they would only issue 1,000,000 betabucks. People trade them based on supply and demand. Perhaps. Though at the time Wei Dai had some arguments at the time that if they were popular, they would be a good investment and people would have an incentive to hold on to them which would make them difficult to obtain, highly inflationary, and hard to use. I have missed that one; however, it is wrong - if people hold them, then they become MORE valuable, and thus you have high deflation - the purchasing power of money grows - which is great. And if their value gets so big that subdivisions start to become necessary, one can always convert them to new betabucks, each old one being worth a million new ones. End of problem. Mark
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
From: Adam Back [EMAIL PROTECTED] Consider during periods of high inflation people don't like holding money, as it devalues too fast. They will hold interest bearing deposits instead. Agreed. During periods of high deflation, they will hold cash if it is the most attractive investment. The result will be shortage of cash, for people who actually want to use it to make purchases because investors will buy all of it. Right. And a shortage of anything, cash making no exception, is solved automatically (if the market is left alone). The value of a monetary unit will rise until its price will be considered (by the cash holders) high enough - that is, until they will value something else more than the cash. Shortages are NEVER a problem if the market is left alone to clear it - they simply indicate an undervaluation of the commodity. Perhaps there are some government monetary systems in history which had this problem. For example gold with sudden shortage of gold supply, or similar. Once you put the gov't into the equation, all bets are off :) Mark
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Fri, 12 Apr 2002, Bill Stewart wrote: Most of the telco business runs on 48V DC, and much of the off-the-grid solar energy electric applications run fine on 12V DC. Problem with high current and low voltage is that ohmic losses are unacceptably high if you want to transport it more than a few 10 m, and you need big wire crossections (which makes for expensive cables, since usually copper), and if you've got a high resistivity somewhere it heats enough to start a fire. That's the reason photovoltaics tends to use 24 V, not 12 V. The big advantages of AC are for motors. Many modern motors are smart, anyway, so they can generate their own AC dynamically, internally. Notice that even with photovoltaics there are smart controllers out there which can synthesize AC (whether 110/60 or 220/50) in realtime from individual cell's contributions (there are other kinds, which are still more widespread, but those have higher losses).
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Fri, 12 Apr 2002, Bill Stewart wrote: Most of the telco business runs on 48V DC, and much of the off-the-grid solar energy electric applications run fine on 12V DC. Problem with high current and low voltage is that ohmic losses are unacceptably high if you want to transport it more than a few 10 m, and you need big wire crossections (which makes for expensive cables, since usually copper), and if you've got a high resistivity somewhere it heats enough to start a fire. That's the reason photovoltaics tends to use 24 V, not 12 V. The big advantages of AC are for motors. Many modern motors are smart, anyway, so they can generate their own AC dynamically, internally. Notice that even with photovoltaics there are smart controllers out there which can synthesize AC (whether 110/60 or 220/50) in realtime from individual cell's contributions (there are other kinds, which are still more widespread, but those have higher losses).
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
At 12:43 AM 04/12/2002 +0100, Adam Back wrote: To be more concrete: there are already apparently e-gold backed credit cards. So why not Everquest virtual platinum backed credit cards for spending your Everquest acquired wealth directly in the real world. I would have thought Sony could have a lot of fun and gain some interesting press from going in this direction -- blurring the line between the VR and the real world -- rather than trying pretty much ineffectivley and hopelessly to stop people trading virtual platinum. I rather like the use of credit cards in Nethack, myself :-) You could do Everquest currency in e-cash. The convenience of payee-anonymous e-cash in facilitating kidnapping might fit in well... on the other hand, loan sharking probably works at least as well with real platinum instead of e-platinum...
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
At 10:51 AM 04/11/2002 -0700, Tim May wrote: No, we have AC because AC works better than DC in home wiring situations. Most of the telco business runs on 48V DC, and much of the off-the-grid solar energy electric applications run fine on 12V DC. The big advantages of AC are for motors. And the issue of patents on software is a _metering_ problem. Software patents have major problems with interfering with authors by forcing them to identify relevant patents. Even if the patent office actually had examiners skilled in the field who had real understanding of prior art and didn't approve bogus patents right and left, it's still impractical for the average software author to wade through 5 million patents before writing a product, especially since patents are deliberately written in patentese, to maximize the potential scope of their claims while minimizing the amount of actual information revealed in the patent. You can't spend years of work just trying to tell if your latest variation on an XOR cursor has already been patented, especially if you're an amateur rather than a business. There are obviously patents that are well-known, well-publicized, and relatively clear in what they're covering, like RSA and Diffie-Hellman, and the metering problem of how to pay for licensing was quite serious for some of them (even for patents whose owners didn't threaten to run you over in the parking lot :-) and no problem for others (Tim's examples with microprocessors.) But it's the patents that you didn't know when writing your application about that can really cause you trouble - some things like RSA are novel and hard to discover, so if you're using them, you heard about them from the patent-holders, but some like automatically encrypt a filesystem are likely to be reinvented, and if you put your product out in the field and *then* find that somebody else has a patent on it (or was in the process of applying for the patent when you were doing your development) then they've got you by the kneecaps. In theory you can contest a patent that was awarded for something that would be obvious to a skilled practitioner, in addition to contesting patents on things that were prior art, but a serious product may have dozens of critical features any one of which could kill you, and if any of them was for something that's obvious enough that you discovered it independently, you're in trouble. In the current system, of course, it's much worse, because the incompetence of the patent office means that they can't tell something that's obvious to a skilled practitioner from something that's obvious to an unskilled practitioner or only obvious to a few experts, and their willingness to accept business method patents means that there are all sorts of bogus patents on things like make money by putting catalogs on line and accepting credit cards or do common-practice-X using *the Internet* as well as bogus patents on actual technology.
Re: CDR: Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
A. Melon wrote: Tim May [EMAIL PROTECTED] wrote: On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. Hmmm. I always thought the reason we went with AC was because at the time, DC power couldn't cut it. They couldn't find any way to reliably transfer DC power more than a half mile or so from the power plant, and when trying to demonstrate it in NYC couldn't even get DC power all the way up a multi-story building. You're saying the same thing. AC works for transmission over long distances because it can be cheaply stepped up in voltage for transmission to minimize losses, then stepped down again for safe domestic use. We now have machinery that does that fairly cheaply for DC, but it's still more expensive than a simple transformer with the same capacity. Long range transmission line are now often high-voltage DC, to take advantage of higher average power at a given peak voltage; it is now possible to efficiently reconvert to AC at the end. In Edison's day that was not so. If his commutated DC generators generated 32 volts (and high-voltage DC generators would have been very difficult to build in those days), that was the transmission voltage, and you had to have a powerplant on every block. What held up AC as a distribution format was the absence of practical AC motors - Tesla broke that logjam, asking little in return, and the rest is history. Marc de Piolenc
overcoming ecash deployment problems (Re: all about transferable off-line ecash)
New thread about deployment barriers to explore the topic of whether there are now more internet services and technologies that would allow us to get closer to deployment of ecash. (It would be about time you'd think). On Thu, Apr 11, 2002 at 08:30:07AM +0200, Anonymous wrote: [...] Of course Brands is patented up the wazoo. It's amazing the harm he and Chaum have done to the world by locking up their best ideas. And they didn't even get rich. What a waste. If either of them had the balls to put their patents into the public domain, they could make a very comfortable living just from consulting and speaking fees. Well I also am pretty anti-patent, especially the xor-cursor and business process kind, but at least these ecash patents are not frivolous patents (well Chaum's RSA blinding online scheme may look pretty simple once you've seen it but Brands stuff is pretty non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) - interface to banking infrastructure given the most convenient way to pay is highly fraud prone (credit cards) -- clearly interfacing a fraud prone system to a cryptographically anonymous ecash system is a recipie for disaster -- it creates the perfect crime for people to cash in on stolen credit-cards. - claimed banking regulation problems. However I'm not sure how much of a barrier this is actually -- I mean MTB digicash did actually operate a payer anonymous scheme (which also indirectly could be used for payee anonymity). so perhaps for this case application patents are not slowing deployment. On the other side patents allow companies to raise finances and big businesses like banks etc may even _like_ to see patents as a more tangible reason to deal with one technology company. [...] there doesn't need to be a bank; just a coin exchanging mint. We talked about this a while ago. You start it up and it emits one coin, which represents all of the value of this mint's money supply. So this would be the argument for a closed supply of money in the system, like the digicash betabucks where they stated up from that they would only issue 1,000,000 betabucks. People trade them based on supply and demand. Perhaps. Though at the time Wei Dai had some arguments at the time that if they were popular, they would be a good investment and people would have an incentive to hold on to them which would make them difficult to obtain, highly inflationary, and hard to use. Also who gets the first coins. Just give them free to the first n people that ask and then let market decide from there. Also the in-out exchange is less convenient. Perhaps with paypal now having wider acceptance people would trade this kind of digicash beta-bucks like scheme for real money paying with paypal with bidding on ebay as for the everquest internal currency. That might be an interesting experiment. Or better yet for everquest or other popular VR gaming thing to replace their currency by digicash currency server, privacy for VR characters and their real-life players. Adam -- http://www.cypherspace.org/adam/
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Thu, 11 Apr 2002, Adam Back wrote: Well I also am pretty anti-patent, especially the xor-cursor and business process kind, but at least these ecash patents are not frivolous patents (well Chaum's RSA blinding online scheme may look pretty simple once you've seen it but Brands stuff is pretty non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: Patent's aren't the problem - price of royalty is. If Brands is willing to get .01 cents per bank per day, he'll be plenty rich and the banks won't lose too much. But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) If people believe (notice Tim?) that when they transfer bits from their electronic wallet to the dealer, and the bank believes when the dealer transfers bits into his account that the bits are money then everybody will want to use it. The idea of coins isn't fluid enough, people want something more like a checkbook. They can move any amount of money from their wallet to somebody else's wallet, and it needs to be just like cash - it can have a serial number, but it's not linked to any person. Merchants don't like credit cards because it costs them. If they could use electronic cash - they'd take it in a heartbeat. Patience, persistence, truth, Dr. mike
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Thu, Apr 11, 2002 at 02:37:50PM +0100, Adam Back wrote: | - deployment / chicken and egg problem (merchants want lots of users | before they're interested users want wide merchant acceptance before | their interested) I think its worse than that. The normal technology adoption curve is that you have people (visionaries or early adopters who are willing to use expensive technology with a high learning curve to get something that they want. When they get a sufficient critical mass, you move to the early mass market. However, with ecash you have the problem that you need to convince not only the users who care about their privacy, but also the merchants to accept it, and the banks to issue it. Consider for a moment if the telcos had to agree to support fax machines; or perhaps if they had to agree to support DSL. (oh wait, they do.) Thus, ecash deployment is a 3 party problem, where most new technologies that succeed are not. I'm honestly not sure if the patents make a big difference in our ability to deploy, given that they're a small speed bump on the way to this brick wall. Sure, its easy, and even fun, to rail on about them, because maybe if we rail at the patent owners long enough, they can be changed, whereas the economic realities are not so subject to persuasion. Adam -- It is seldom that liberty of any kind is lost all at once. -Hume
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
At 01:14 AM 4/12/2002 +1000, Julian Assange wrote: Patent's aren't the problem - price of royalty is. If Brands is willing No Patents are a problem. The total future cost, including the costs of all license negotiations and compliance burdens are unpredictable and consequently do not make a wise investment. In the case of Chaum, patents are not the problem. AFAIK, SW patents are still not recognized in a number of major countries (Australia, NZ, SA, etc.). Since the Chaum patents are practiced only on the client side, it should be trivial to create/distribute the SW from one of these jurisdictions. One could even include a client controlled SW switch setting to enable blinding and present it as an increased security setting with appropriate warnings about possible IP issues depending upon the locale of the client. steve
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
[Digital Bearer Settlement [EMAIL PROTECTED] address removed.] On Thursday, April 11, 2002, at 06:37 AM, Adam Back wrote: New thread about deployment barriers to explore the topic of whether there are now more internet services and technologies that would allow us to get closer to deployment of ecash. (It would be about time you'd think). non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) Motivation is the real issue. People will not adopt a complicated (to them, to many) new financial system unless it offers them more value than it costs them. Or unless they have no choice because others have made the change and they need to be compliant. People will not clamor for digital cash (henceforth assumed to be 2-way untraceable, not one of the watered-down one-way untraceable forms) unless they seem some advantages. Protecting their privacy alone is not sufficient, at least not for most transactions (buying things in stores, buying books and computers online, CDs, DVDs, etc.). The millicent ghetto is especially unfruitful as a market for digital cash, at least at our level. As I have said, some people make efforts to open offshore bank accounts, for income tax evasion, money laundering, purchase of illegal items, etc. The crackdown on offshore-backed VISAs and Mastercards is in the news. This provides some clue as to how much effort people will make to avoid certain kinds of traceability...and the efforts against banks and clearinghouses to stop these bypasses. What would people really seek good 2-way digital cash for? Anonymity and untraceability really matters when the consequences of being traced are serious. Selling child porn, for example. Examples abound.. What the world needs is not a good 5-cent digital money token, but a good $5 or $50 digital money token. And I mean good, because law enforcement will be seeking to trace down who is buying and selling illegal warez. Other illegal uses which could motivate use of digital cash are: online gambling/numbers games, buying and selling of corporate insider information, tax evasion (eventually), etc. Redemption issues are not easy to arrange. Any bank which acts to issue and redeem/convert such tokens, when the main market is for trading child porn or other illegal warez, will likely be shut down by international bodies. A tough nut to crack. But at least we should be thinking about the customer-driven uses, not trying to get convince Joe Sixpack that he really should be using digital cash online, especially when just last week he was happy to give his SS number for the online drawing for a free CD. Also who gets the first coins. Just give them free to the first n people that ask and then let market decide from there. Also the in-out exchange is less convenient. Perhaps with paypal now having wider acceptance people would trade this kind of digicash beta-bucks like scheme for real money paying with paypal with bidding on ebay as for the everquest internal currency. That might be an interesting experiment. Or better yet for everquest or other popular VR gaming thing to replace their currency by digicash currency server, privacy for VR characters and their real-life players. Game use is an interesting one, as we've talked about over the years. First, it may ostensibly seem innocuous. Second, it both simulates and educates. Third, there is the potential for a redemption leakage, e.g., where the artificial money of the artificial system is bought and sold by players (seen in Everquest recently, seen a decade ago with an Extropians reputation-rating system). More generally, I'm a fan of building simulated systems which have more moving parts than just the here's a digital cash protocol...enjoy! approach. Pieces in isolation are like giving someone a piece of a complicated machine and telling him to make use of it. More on this later. --Tim May They played all kinds of games, kept the House in session all night, and it was a very complicated bill. Maybe a handful of staffers actually read it, but the bill definitely was not available to members before the vote. --Rep. Ron Paul, TX, on how few Congresscritters saw the USA-PATRIOT Bill before voting overwhelmingly to impose a police state
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: On Thu, 11 Apr 2002, Adam Back wrote: Well I also am pretty anti-patent, especially the xor-cursor and business process kind, but at least these ecash patents are not frivolous patents (well Chaum's RSA blinding online scheme may look pretty simple once you've seen it but Brands stuff is pretty non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: Patent's aren't the problem - price of royalty is. If Brands is willing to get .01 cents per bank per day, he'll be plenty rich and the banks won't lose too much. But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. And the issue of patents on software is a _metering_ problem. When the first microprocessors (and chips in general, but I'll focus on uPs) were sold, there was a lot of intellectual property embodied in the chips: patents, copyrights, etc. But the buyer of a chip, to be used for any purpose he cared to put it to, did not need to concern himself with negotiating anything with the vendor. The patents and other rights were bundled into the chip, reified, so to speak. Anyone could buy 1 or 100 or a million chips and put them to any use. This meant a garage company could buy a couple of 8080s, build a product, and sell it...unencumbered. Not so with RSA, for example. Before RSADSI would talk to a potential customer, they asked a lot of questions about uses, conflicts with other customers who had already bought the software, how the products would be identified and marked and metered. A garage company seeking to build RSA into a product would first have to hire a large negotiating team of lawyers and patent experts, and then would have to disclose full details of products. And RSADSI would probably not be interested in a chump change operation anyway. Ditto for Digicash. Ditto for _most_ software products. This is because the products themselves do not, and cannot, meter themselves. - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) If people believe (notice Tim?) that when they transfer bits from their electronic wallet to the dealer, and the bank believes when the dealer transfers bits into his account that the bits are money then everybody will want to use it. Yes, I notice. Thanks. I really do believe (no pun intended) that replacing vague notions of trust with actor-centered notions of belief is important. But this doesn't solve the metering issue. (What _does_ solve will need another article.) The idea of coins isn't fluid enough, people want something more like a checkbook. They can move any amount of money from their wallet to somebody else's wallet, and it needs to be just like cash - it can have a serial number, but it's not linked to any person. Merchants don't like credit cards because it costs them. If they could use electronic cash - they'd take it in a heartbeat. Digital cash is not free, either. (Or, rather, there is no particular ontological reason to expect it to have no fees attached.) Also, the putative cost of processing VISA, MC, and other cards is dropping, and has been dropping for decades. Merchants can often negotiate favorable rates. And there is no basic reason why such systems cannot be _almost_ as efficient in pricing as other systems. And even if the cost of processing is 1-3% for the merchant, he also gains something. Besides gaining customers who may not have either cash or checkbooks with them, especially true for _online_ stores!, his store has less physical cash. Those Loomis and Wells Fargo armored trucks hauling bags of cash around come with some costs. And shrinkage from the cash registers and hold-ups of stores is a major cost, both for direct losses and for insurance and hiring costs. Hauling bits is both physically safer and less costly. --Tim May The great object is that every man be armed and everyone who is able may have a gun. --Patrick Henry The best we can hope for concerning the people at large is that they be properly armed. --Alexander Hamilton
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
Tim May [EMAIL PROTECTED] wrote: On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. Hmmm. I always thought the reason we went with AC was because at the time, DC power couldn't cut it. They couldn't find any way to reliably transfer DC power more than a half mile or so from the power plant, and when trying to demonstrate it in NYC couldn't even get DC power all the way up a multi-story building. Tesla's AC power solved this problem, after which Edison and his backers started some kind of smear campaign saying that DC was safer and such. Mr Anonymous
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On 11 Apr 2002 at 12:48, A. Melon wrote: Tim May [EMAIL PROTECTED] wrote: On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. Hmmm. I always thought the reason we went with AC was because at the time, DC power couldn't cut it. They couldn't find any way to reliably transfer DC power more than a half mile or so from the power plant, and when trying to demonstrate it in NYC couldn't even get DC power all the way up a multi-story building. It's like this: transformers work for AC and not for DC. Losses in transmission only depend on current, so if you can send high voltage low current through your transmission lines and then transform down at the other end you get less transmission losses. Tesla's AC power solved this problem, after which Edison and his backers started some kind of smear campaign saying that DC was safer and such. Yes, the high voltage transmission lines were deadlier to squirrels. Lighting was the killer app for electricity, and it'll work fine off DC or AC. Motors will also (just make sure you have the right kind of motor), but if you just can have one thing coming out of your walls you're much better off with AC, even if most of your appliances work off DC, because it's easier to transform and recify AC to get a specific DC voltage than it is to do a DC-DC trasnformation. The only way you'd be better off with DC coming out of your walls would be if not only did all your stuff work off DC, but it all worked off the same DC voltage. I think you'll find that every place in the world that has power has AC coming out of its walls, even ones that just got electricity recently. It's not a historic accident, it's better. I hear that the primitives in Europe use 50 Hz AC. Our 60 Hz is clearly superior, because we need smaller transformers and capacitors to get the same effect. I had an idea for something even better than 60 Hz AC once, but I've forgotten what it was. George Mr Anonymous
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
At 10:57 AM 4/11/2002 -0400, Adam Shostack wrote: Thus, ecash deployment is a 3 party problem, where most new technologies that succeed are not. Actually, it is worse than this. Credit cards are a four party transaction. Mostly for historical reasons, but still, the customer's card is presented to a merchant, who presents the slips to a acquiring bank who then talks to the issuing bank to get money from the customer. The banks maintain this system when it has long outlived its historical justification. Similarly, checks are a four party transaction. Real cash is a two party transaction, but nearly everything else has four or more. So to begin with, you need to work it as a four party problem. You will have to bribe one or more parties to make them agree to drop out of the party. Pat Pat Farrell [EMAIL PROTECTED] http://www.pfarrell.com
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
I just wrote: If they grew large enough their acceptance, or an ecash system backed in them, might spill over into the real world and allow purchase of services on the web, or even physical goods. To be more concrete: there are already apparently e-gold backed credit cards. So why not Everquest virtual platinum backed credit cards for spending your Everquest acquired wealth directly in the real world. I would have thought Sony could have a lot of fun and gain some interesting press from going in this direction -- blurring the line between the VR and the real world -- rather than trying pretty much ineffectivley and hopelessly to stop people trading virtual platinum. Adam
Re: CDR: Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
A. Melon wrote: Tim May [EMAIL PROTECTED] wrote: On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. Hmmm. I always thought the reason we went with AC was because at the time, DC power couldn't cut it. They couldn't find any way to reliably transfer DC power more than a half mile or so from the power plant, and when trying to demonstrate it in NYC couldn't even get DC power all the way up a multi-story building. You're saying the same thing. AC works for transmission over long distances because it can be cheaply stepped up in voltage for transmission to minimize losses, then stepped down again for safe domestic use. We now have machinery that does that fairly cheaply for DC, but it's still more expensive than a simple transformer with the same capacity. Long range transmission line are now often high-voltage DC, to take advantage of higher average power at a given peak voltage; it is now possible to efficiently reconvert to AC at the end. In Edison's day that was not so. If his commutated DC generators generated 32 volts (and high-voltage DC generators would have been very difficult to build in those days), that was the transmission voltage, and you had to have a powerplant on every block. What held up AC as a distribution format was the absence of practical AC motors - Tesla broke that logjam, asking little in return, and the rest is history. Marc de Piolenc
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
At 01:14 AM 4/12/2002 +1000, Julian Assange wrote: Patent's aren't the problem - price of royalty is. If Brands is willing No Patents are a problem. The total future cost, including the costs of all license negotiations and compliance burdens are unpredictable and consequently do not make a wise investment. In the case of Chaum, patents are not the problem. AFAIK, SW patents are still not recognized in a number of major countries (Australia, NZ, SA, etc.). Since the Chaum patents are practiced only on the client side, it should be trivial to create/distribute the SW from one of these jurisdictions. One could even include a client controlled SW switch setting to enable blinding and present it as an increased security setting with appropriate warnings about possible IP issues depending upon the locale of the client. steve
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
[Digital Bearer Settlement [EMAIL PROTECTED] address removed.] On Thursday, April 11, 2002, at 06:37 AM, Adam Back wrote: New thread about deployment barriers to explore the topic of whether there are now more internet services and technologies that would allow us to get closer to deployment of ecash. (It would be about time you'd think). non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) Motivation is the real issue. People will not adopt a complicated (to them, to many) new financial system unless it offers them more value than it costs them. Or unless they have no choice because others have made the change and they need to be compliant. People will not clamor for digital cash (henceforth assumed to be 2-way untraceable, not one of the watered-down one-way untraceable forms) unless they seem some advantages. Protecting their privacy alone is not sufficient, at least not for most transactions (buying things in stores, buying books and computers online, CDs, DVDs, etc.). The millicent ghetto is especially unfruitful as a market for digital cash, at least at our level. As I have said, some people make efforts to open offshore bank accounts, for income tax evasion, money laundering, purchase of illegal items, etc. The crackdown on offshore-backed VISAs and Mastercards is in the news. This provides some clue as to how much effort people will make to avoid certain kinds of traceability...and the efforts against banks and clearinghouses to stop these bypasses. What would people really seek good 2-way digital cash for? Anonymity and untraceability really matters when the consequences of being traced are serious. Selling child porn, for example. Examples abound.. What the world needs is not a good 5-cent digital money token, but a good $5 or $50 digital money token. And I mean good, because law enforcement will be seeking to trace down who is buying and selling illegal warez. Other illegal uses which could motivate use of digital cash are: online gambling/numbers games, buying and selling of corporate insider information, tax evasion (eventually), etc. Redemption issues are not easy to arrange. Any bank which acts to issue and redeem/convert such tokens, when the main market is for trading child porn or other illegal warez, will likely be shut down by international bodies. A tough nut to crack. But at least we should be thinking about the customer-driven uses, not trying to get convince Joe Sixpack that he really should be using digital cash online, especially when just last week he was happy to give his SS number for the online drawing for a free CD. Also who gets the first coins. Just give them free to the first n people that ask and then let market decide from there. Also the in-out exchange is less convenient. Perhaps with paypal now having wider acceptance people would trade this kind of digicash beta-bucks like scheme for real money paying with paypal with bidding on ebay as for the everquest internal currency. That might be an interesting experiment. Or better yet for everquest or other popular VR gaming thing to replace their currency by digicash currency server, privacy for VR characters and their real-life players. Game use is an interesting one, as we've talked about over the years. First, it may ostensibly seem innocuous. Second, it both simulates and educates. Third, there is the potential for a redemption leakage, e.g., where the artificial money of the artificial system is bought and sold by players (seen in Everquest recently, seen a decade ago with an Extropians reputation-rating system). More generally, I'm a fan of building simulated systems which have more moving parts than just the here's a digital cash protocol...enjoy! approach. Pieces in isolation are like giving someone a piece of a complicated machine and telling him to make use of it. More on this later. --Tim May They played all kinds of games, kept the House in session all night, and it was a very complicated bill. Maybe a handful of staffers actually read it, but the bill definitely was not available to members before the vote. --Rep. Ron Paul, TX, on how few Congresscritters saw the USA-PATRIOT Bill before voting overwhelmingly to impose a police state
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: On Thu, 11 Apr 2002, Adam Back wrote: Well I also am pretty anti-patent, especially the xor-cursor and business process kind, but at least these ecash patents are not frivolous patents (well Chaum's RSA blinding online scheme may look pretty simple once you've seen it but Brands stuff is pretty non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: Patent's aren't the problem - price of royalty is. If Brands is willing to get .01 cents per bank per day, he'll be plenty rich and the banks won't lose too much. But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. And the issue of patents on software is a _metering_ problem. When the first microprocessors (and chips in general, but I'll focus on uPs) were sold, there was a lot of intellectual property embodied in the chips: patents, copyrights, etc. But the buyer of a chip, to be used for any purpose he cared to put it to, did not need to concern himself with negotiating anything with the vendor. The patents and other rights were bundled into the chip, reified, so to speak. Anyone could buy 1 or 100 or a million chips and put them to any use. This meant a garage company could buy a couple of 8080s, build a product, and sell it...unencumbered. Not so with RSA, for example. Before RSADSI would talk to a potential customer, they asked a lot of questions about uses, conflicts with other customers who had already bought the software, how the products would be identified and marked and metered. A garage company seeking to build RSA into a product would first have to hire a large negotiating team of lawyers and patent experts, and then would have to disclose full details of products. And RSADSI would probably not be interested in a chump change operation anyway. Ditto for Digicash. Ditto for _most_ software products. This is because the products themselves do not, and cannot, meter themselves. - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) If people believe (notice Tim?) that when they transfer bits from their electronic wallet to the dealer, and the bank believes when the dealer transfers bits into his account that the bits are money then everybody will want to use it. Yes, I notice. Thanks. I really do believe (no pun intended) that replacing vague notions of trust with actor-centered notions of belief is important. But this doesn't solve the metering issue. (What _does_ solve will need another article.) The idea of coins isn't fluid enough, people want something more like a checkbook. They can move any amount of money from their wallet to somebody else's wallet, and it needs to be just like cash - it can have a serial number, but it's not linked to any person. Merchants don't like credit cards because it costs them. If they could use electronic cash - they'd take it in a heartbeat. Digital cash is not free, either. (Or, rather, there is no particular ontological reason to expect it to have no fees attached.) Also, the putative cost of processing VISA, MC, and other cards is dropping, and has been dropping for decades. Merchants can often negotiate favorable rates. And there is no basic reason why such systems cannot be _almost_ as efficient in pricing as other systems. And even if the cost of processing is 1-3% for the merchant, he also gains something. Besides gaining customers who may not have either cash or checkbooks with them, especially true for _online_ stores!, his store has less physical cash. Those Loomis and Wells Fargo armored trucks hauling bags of cash around come with some costs. And shrinkage from the cash registers and hold-ups of stores is a major cost, both for direct losses and for insurance and hiring costs. Hauling bits is both physically safer and less costly. --Tim May The great object is that every man be armed and everyone who is able may have a gun. --Patrick Henry The best we can hope for concerning the people at large is that they be properly armed. --Alexander Hamilton
overcoming ecash deployment problems (Re: all about transferable off-line ecash)
New thread about deployment barriers to explore the topic of whether there are now more internet services and technologies that would allow us to get closer to deployment of ecash. (It would be about time you'd think). On Thu, Apr 11, 2002 at 08:30:07AM +0200, Anonymous wrote: [...] Of course Brands is patented up the wazoo. It's amazing the harm he and Chaum have done to the world by locking up their best ideas. And they didn't even get rich. What a waste. If either of them had the balls to put their patents into the public domain, they could make a very comfortable living just from consulting and speaking fees. Well I also am pretty anti-patent, especially the xor-cursor and business process kind, but at least these ecash patents are not frivolous patents (well Chaum's RSA blinding online scheme may look pretty simple once you've seen it but Brands stuff is pretty non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) - interface to banking infrastructure given the most convenient way to pay is highly fraud prone (credit cards) -- clearly interfacing a fraud prone system to a cryptographically anonymous ecash system is a recipie for disaster -- it creates the perfect crime for people to cash in on stolen credit-cards. - claimed banking regulation problems. However I'm not sure how much of a barrier this is actually -- I mean MTB digicash did actually operate a payer anonymous scheme (which also indirectly could be used for payee anonymity). so perhaps for this case application patents are not slowing deployment. On the other side patents allow companies to raise finances and big businesses like banks etc may even _like_ to see patents as a more tangible reason to deal with one technology company. [...] there doesn't need to be a bank; just a coin exchanging mint. We talked about this a while ago. You start it up and it emits one coin, which represents all of the value of this mint's money supply. So this would be the argument for a closed supply of money in the system, like the digicash betabucks where they stated up from that they would only issue 1,000,000 betabucks. People trade them based on supply and demand. Perhaps. Though at the time Wei Dai had some arguments at the time that if they were popular, they would be a good investment and people would have an incentive to hold on to them which would make them difficult to obtain, highly inflationary, and hard to use. Also who gets the first coins. Just give them free to the first n people that ask and then let market decide from there. Also the in-out exchange is less convenient. Perhaps with paypal now having wider acceptance people would trade this kind of digicash beta-bucks like scheme for real money paying with paypal with bidding on ebay as for the everquest internal currency. That might be an interesting experiment. Or better yet for everquest or other popular VR gaming thing to replace their currency by digicash currency server, privacy for VR characters and their real-life players. Adam -- http://www.cypherspace.org/adam/
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Thu, 11 Apr 2002, Adam Back wrote: Well I also am pretty anti-patent, especially the xor-cursor and business process kind, but at least these ecash patents are not frivolous patents (well Chaum's RSA blinding online scheme may look pretty simple once you've seen it but Brands stuff is pretty non-obvious). Plus for the particular application of ecash it would seem the biggest stumbling blocks are: Patent's aren't the problem - price of royalty is. If Brands is willing to get .01 cents per bank per day, he'll be plenty rich and the banks won't lose too much. But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. - deployment / chicken and egg problem (merchants want lots of users before they're interested users want wide merchant acceptance before their interested) If people believe (notice Tim?) that when they transfer bits from their electronic wallet to the dealer, and the bank believes when the dealer transfers bits into his account that the bits are money then everybody will want to use it. The idea of coins isn't fluid enough, people want something more like a checkbook. They can move any amount of money from their wallet to somebody else's wallet, and it needs to be just like cash - it can have a serial number, but it's not linked to any person. Merchants don't like credit cards because it costs them. If they could use electronic cash - they'd take it in a heartbeat. Patience, persistence, truth, Dr. mike
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On Thu, Apr 11, 2002 at 02:37:50PM +0100, Adam Back wrote: | - deployment / chicken and egg problem (merchants want lots of users | before they're interested users want wide merchant acceptance before | their interested) I think its worse than that. The normal technology adoption curve is that you have people (visionaries or early adopters who are willing to use expensive technology with a high learning curve to get something that they want. When they get a sufficient critical mass, you move to the early mass market. However, with ecash you have the problem that you need to convince not only the users who care about their privacy, but also the merchants to accept it, and the banks to issue it. Consider for a moment if the telcos had to agree to support fax machines; or perhaps if they had to agree to support DSL. (oh wait, they do.) Thus, ecash deployment is a 3 party problem, where most new technologies that succeed are not. I'm honestly not sure if the patents make a big difference in our ability to deploy, given that they're a small speed bump on the way to this brick wall. Sure, its easy, and even fun, to rail on about them, because maybe if we rail at the patent owners long enough, they can be changed, whereas the economic realities are not so subject to persuasion. Adam -- It is seldom that liberty of any kind is lost all at once. -Hume
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
Tim May [EMAIL PROTECTED] wrote: On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. Hmmm. I always thought the reason we went with AC was because at the time, DC power couldn't cut it. They couldn't find any way to reliably transfer DC power more than a half mile or so from the power plant, and when trying to demonstrate it in NYC couldn't even get DC power all the way up a multi-story building. Tesla's AC power solved this problem, after which Edison and his backers started some kind of smear campaign saying that DC was safer and such. Mr Anonymous
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
On 11 Apr 2002 at 12:48, A. Melon wrote: Tim May [EMAIL PROTECTED] wrote: On Thursday, April 11, 2002, at 06:59 AM, Mike Rosing wrote: But the reason we have AC today is because Tesla requested no royalties on his motor/generator. Something for Brands to think about. No, we have AC because AC works better than DC in home wiring situations. Hmmm. I always thought the reason we went with AC was because at the time, DC power couldn't cut it. They couldn't find any way to reliably transfer DC power more than a half mile or so from the power plant, and when trying to demonstrate it in NYC couldn't even get DC power all the way up a multi-story building. It's like this: transformers work for AC and not for DC. Losses in transmission only depend on current, so if you can send high voltage low current through your transmission lines and then transform down at the other end you get less transmission losses. Tesla's AC power solved this problem, after which Edison and his backers started some kind of smear campaign saying that DC was safer and such. Yes, the high voltage transmission lines were deadlier to squirrels. Lighting was the killer app for electricity, and it'll work fine off DC or AC. Motors will also (just make sure you have the right kind of motor), but if you just can have one thing coming out of your walls you're much better off with AC, even if most of your appliances work off DC, because it's easier to transform and recify AC to get a specific DC voltage than it is to do a DC-DC trasnformation. The only way you'd be better off with DC coming out of your walls would be if not only did all your stuff work off DC, but it all worked off the same DC voltage. I think you'll find that every place in the world that has power has AC coming out of its walls, even ones that just got electricity recently. It's not a historic accident, it's better. I hear that the primitives in Europe use 50 Hz AC. Our 60 Hz is clearly superior, because we need smaller transformers and capacitors to get the same effect. I had an idea for something even better than 60 Hz AC once, but I've forgotten what it was. George Mr Anonymous
Re: overcoming ecash deployment problems (Re: all about transferable off-line ecash)
At 10:57 AM 4/11/2002 -0400, Adam Shostack wrote: Thus, ecash deployment is a 3 party problem, where most new technologies that succeed are not. Actually, it is worse than this. Credit cards are a four party transaction. Mostly for historical reasons, but still, the customer's card is presented to a merchant, who presents the slips to a acquiring bank who then talks to the issuing bank to get money from the customer. The banks maintain this system when it has long outlived its historical justification. Similarly, checks are a four party transaction. Real cash is a two party transaction, but nearly everything else has four or more. So to begin with, you need to work it as a four party problem. You will have to bribe one or more parties to make them agree to drop out of the party. Pat Pat Farrell [EMAIL PROTECTED] http://www.pfarrell.com
