On Thu, 12 Jul 2001, Adam Back wrote:
Also trust levels needed to trust in something as a value store are much higher than purely as a immediately cleared payment mechanism. With the reputation system you could even have insurance.
Uh, to clarify, at least in the current version of the design, the reputation system *is* insurance. Basically in a pseudonymous situation, the only kind of reputation system that could possibly matter is where the person providing the reputation certificates does so by offering to bet real money on someone's good behavior at easy odds. Otherwise you can just spoof the system with tentacle reputation agents that all recommend you (and each other). So, when alice-the-buyer wants some assurances that bob-the-seller won't rip her off, she goes to Carol-the-reputation-agent and says "What are the odds on Bob reneging in a five-hundred-buck deal?" And Carol's response is something like "I'll bet Bob does you a straight deal, five-hundred-to-one." Alice considers the rate and decides she wants insurance, pays Carol a buck for a "marker" to use in the contract, does a five-hundred-buck deal with bob (man, that's a lot of venison) and if Bob reneges, Alice gets to cash in Carol's five-hundred-buck marker - thus getting her money back. Carol instantly warns every other reputation agent in the system about Bob and how he reneged for five hundred bucks -- so that Nym is effectively trashed. If Bob doesn't renege, Carol makes a buck. Anyway; whether you call Carol a bookie or an insurance dealer is entirely negotiable. But in this scheme your "reputation" means neither more nor less than the cheapest insurance rates someone can get if they try to insure themselves against you reneging. Bear