But someone a long time ago brought up traveller's checks, and the similarity between them and ecash. [...] You pay some money to American Express, you get a note issued by them, you give it to a merchant, he redeems in with AE for money. [etc...] I dont' know much about economics, but as far as I can tell this seems a pretty solid analogy. What you have described is a financial model for digital cash, which is only part of a complete model. The financial model is, as you point out, pretty easy. You buy an instrument and then use it in lieu of a more direct transfer. The privacy to counterparty comes about because the issuer's name is on the instrument, not yours; the issuer is a proxy for identity. It's clearly not _illegal_ to issue travellers checks, No, but in certain places where they are used in lieu of greenbacks, aka Federal Reserve Banknotes, it _is_ illegal to use them without certain reporting requirements. (Duncan can elaborate, as he's much more up on the details here.) Complicity in failure to report can also be criminal. And an issuer that sets up a system to thwart reporting requirements could easily be considered _prima facie_ evidence of conspiracy to evade reporting. When the government doesn't want anonymity, expect that it will be difficult to create. Eric