ecash, cut & choose and private credentials
-----BEGIN PGP SIGNED MESSAGE----- Hash: SHA1 <snip> Adam Back wrote:
I think the thing that killed MT / digicash for this application was MT at the time was reported to be closing accounts related to pornography -- they apparently didn't want the reputation for providing payment mechanisms for the porn industry or something.
James Donald replied:
Payee traceability made it possible to close accounts related to pornography. Ecash is not truly cash like if the issuer can prevent it from being used by tax evaders, child pornographers, money launderers and terrorists.
Hettinga replied:
Payee traceability had nothing to do with it. Every customer of MTB, whether an end user or a merchant, had to fully identify himself to the bank, including SSN and for merchants, type of business, etc. This is SOP for other payment systems like credit cards.
It was on this basis that MTB was able to screen their merchants. No payee tracing was necessary. A fully untraceable cash system would have been equally amenable to merchant screening. Any vendor has the right to control whom it does business with, and MTB chose to exercise its discretion in this way.
The Texas couple in the news recently made a different choice and decided to provide payment services for child pornographers, as James Donald recommends. Now MTB is still in business (after merging with MTL and then FSR) and the Texans are in jail. Which made a better choice?
There are a host of issues that prevented the widespread use of eCash(tm), or perhaps better phrased didn't properly incent the widespread use of eCash in the mid-1990's. Certainly a number of the decisions I made contributed, but I don't believe that the merchant criteria was even a blip despite the firestorm the action created within a narrow community - see http://www.shipwright.com/rants/rant_12.html for a contemporaneous and at the time much appreciated commentary from you-know-who. Ultimately any "value transfer system" must be broadly accepted across personal, business and institutional entities (yes I think the latter two are different) - today all of these can interchangeably use cash, checks, ach or wires for example. The combination of credit quality, trust, and lowest transaction costs must all be present for something to replace our current mediums. When value is involved wealth-owners tend to focus first on the trust and credit issues - if your wealth disappears then it just doesn't matter what the transaction costs are. Some recent discussions on or near this list of perceived issues with PayPal and e-gold point out that the trust factor includes all participants agreeing on the rules of engagement. To achieve the primary trust and credit goals of wealth owners and within the constructs that are available to us today this seems to mean that regulated financial institutions may need to be involved, but the form and content are yet to be determined. FOT Personal comments only. ======================== Frank O. Trotter, III President - everbank.com Spank your banker and come on over to http://www.everbank.com everbank is a Division of Wilmington Savings Fund Society, FSB -----BEGIN PGP SIGNATURE----- Version: PGP 6.5.2 iQA/AwUBOi2xKKc6Jcu2sioFEQLZhgCg7qjfsjLUHioCyH8NHbkl4YOwdxgAoI47 1aFn+T5SHhxW+fYgpxnuGeNQ =ezLL -----END PGP SIGNATURE----- --- end forwarded text -- ----------------- R. A. Hettinga <mailto: rah@ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
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Trotter, Frank