A few days ago I asked:
Can a case be made that anonymous digicash is less risky (to a bank) than NON-anonymous digicash?
There were no takers. Therefore, I'll ask different questions:
Would a Chaum-style anonymous digital cash service be more profitable to a bank than a NON-anonymous digital cash service?
I think that very few would have the initiative to lay out the money for a no-transaction cash system. With credit cards and checks there is a transaction trail that you can follow to spot and get rid of fraud. For someone in the banking community who is used to giving out paper transaction slips and taking deposit slips, I think it is a frightning idea.
Are the costs involved in offering and supporting anonymous digital cash more, or less, than the costs associated with NON-anonymous digital cash?
It depends on what kind of hardware/software you are attempting to set up. Will it be a replacement to ATM and credit cards or would it be a concurrent working solution? (ie, is a merchant who has just spent $1000 on a spiffy POS machine that read checks, takes every credit card in existance, and ATM cards going to want to junk his equipment for a smart-card reader?) . I think at this point, it is pretty obsurd to think that everyone will be carrying around thier 486 laptop to act as a "representative" for their smart card. If it is going to work: 1. It must be convient for the customer; and/or 2. It must save money or time; and/or 3. It must provide additional benifits for customers or merchants (ie, privacy for customers, undeniable transactions for merchants).
In other words, why might a bank chose to offer/support anonymous digital cash over NON-anonymous digital cash?
If a "bank-centric" case for anonymous digital case over NON-anonymous digital cash can't be made, then there's little chance we'll see anonymous digital cash any time soon.
Chaum writes (sciam.txt available via ftp at: digicash.nl): Blinded electronic bank notes protect an individual's privacy, but because each note is simply a number, it can be copied easily. To prevent double spending, each note must be checked on-line against a central list when it is spent. Such a verification procedure might be acceptable when large amounts of money are at stake, but it is far too expensive to use when someone is just buying a newspaper. This was as I said in my earlier post-- that I would include an online-verification to make sure notes are real and not double-spent. -- Joe N. Turner Telecheck International turner@telecheck.com 5251 Westheimer, PO BOX 4659, Houston, TX 77210-4659 compu$erv: 73301,1654 (800) 888-4922 * (713) 439-6597