I apologize for changing the thread name, but the existing name, "Re: (X:x)e$ 's other use," seems unrelated to these points. At 1:46 PM 3/27/96, Scott Schryvers wrote:
Question. If e-cash were backed by gold would that make it more reliable than say the dollar?
This question, and much of the debate that appears here about digital money in its many and confusing forms (e-cash, digicash, bitmarks, e$, cypherfrancs, chaums, etc.), displays a "type error" in thinking about digital money. No form of digital money extant is an actual currency in the conventional sense. Nor does this seem likely. Nor necessary. Nor useful. Nor important. Rather, think in terms of _checks_ or _wire transfers_ and the like. An order to transfer funds from one account or place of holding to another. Eric Hughes was our local resident self-educated expert on commercial paper, notes, bank drafts, etc. Bob Hettinga has also written extensively on this. A nice little book I use is "The MIT Dictionary of Modern Economics," 4th, edited by David W. Pearce, 1992. Nothing yet on digital money and how various forms of it fit into the taxonomy of financial instruments. I expect by the 6th edition, in a few years, we'll see some stuff. But here are just a couple of definitions, to tell you all that an actual taxonomy does exist, that "money" is not the all-inclusive type. * "currency. Strictly, that component of a country's money stock that literally circulates from hand to hand, i.e., coin and banknotes...." * "cheque. A document, normally supplied in printed form by a bank, ordering the bank to transfer funds from the drawer's current account to a named payee...." (more wrinkles about negotiability, endorsements, counter checks, etc.) So, what are the classifications of the schemes offered by CyberCash, First Virtual, Digicash, Mark Twain Bank, and so on? A useful project for any of you out there with banking or finance interests. Most of these are currently variants of credit card transactions, and the best of these (in cryptographic terms) appears to be a variant of a straight bank. I might give instructions for Union Bank to transfer X amount of gold, or Swiss francs, or dollars from Account X to Account Y, where Account Y might be in the same bank, might be in another bank, or might be to anyone who showed up at the bank and produced the claim... The point being that talking about "what backs up digital cash?" is misleading. (What really backs it up is the reputation of the entities, but I digress.) --Tim May Boycott "Big Brother Inside" software! We got computers, we're tapping phone lines, we know that that ain't allowed. ---------:---------:---------:---------:---------:---------:---------:---- Timothy C. May | Crypto Anarchy: encryption, digital money, tcmay@got.net 408-728-0152 | anonymous networks, digital pseudonyms, zero W.A.S.T.E.: Corralitos, CA | knowledge, reputations, information markets, Higher Power: 2^756839 - 1 | black markets, collapse of governments. "National borders aren't even speed bumps on the information superhighway."