Douglas Barnes <cman@communities.com> writes on cypherpunks:

...

I'm afraid you may have somewhat misunderstood the motivation behind the Identity Agnostic paper. In no way is it intended as a way of not facing the music wrt regulators in the country(s) where such an institution has offices. The IA approach is intended as an possible alternative for an institution that might otherwise license from Chaum.

So it's intended for avoiding patent issues only?

Yes, and not really so much because of price. I'm not the only person who has found David hard to work with -- he has apparently decided to only license "respectable" organizations that will not, in his eyes, make his technology look "bad". I can tell you from painful, expensive experience that a band of cypherpunks does not qualify as "respectable" in his eyes. Alas for David, his technology is fundamentally cypherpunk -- there is little motivation for a "respectable" institution to be the first penguin on this stuff. So, if you're a bank, licensing from David is cheap and relatively painless, but there are powerful disincentives to deployment. Also, assessing demand is problematic. For a small cypherpunk startup, the demand is obvious, there are powerful incentives, but the cost of licensing and David's reluctance to license a slightly wild-eyed startup act as a barrier. There is certainly a middle ground, but nobody seems to be stepping forward. My understanding was that we were exploring the idea of a much smaller, non-bank organization going into the digital cash business. Note that while this is theoretically interesting to me, the fact that I'm talking openly about this stuff is largely due to my decision _not_ to get personally involved in this kind of venture except as a sidelines cheerleader, or as an absolute last resort if nobody deploys. Given that we're talking about a small, cypherpunk-motivated NBFI, I think the IA stuff will work fine. It should be presented to the regulators as if it were a fully-blinded system, since there won't be any guarantee that blinding isn't occurring. You raise the issue of using software not supplied by the "bank" -- if we're talking about a c'punks project, I'd assume you'd make the full source code of the system available. The change of a client from non-blinding to blinding would be about two lines of code. You've also discussed the issue of commercial uptake -- as I see it, one of the primary goals of a project like this would be to provide incentive to deploy to the allegedly numerous Chaum licensees that have not implemented a damned thing so far. And, with a nice interface -- or at least the sort of generic GUI interface you can get with Java -- it might do surprisingly well on its own merits. Realistically, as soon as someone large comes along, you're likely to get squashed. But it would be an interesting ride, and you might just end up getting bought out instead of squashed. As for a limit on transaction size, my understanding is that Mondex is using $300 initially as a transaction limit. This certainly seems reasonable, and it skates in underneath a lot of magic numbers.