At 10:17 AM 8/22/94 -0400, Jason W Solinsky wrote:

A buck is NOT a buck. It keeps on going down in value. We should use the introduction of digicash to finally create a monetary instrument that never experiences positive inflation.

It's important not to pile on too many features, desires, agendas onto a relatively simple financial instrument. The point of digital cash is to provide liquidity for internet commerce as cheaply as possible. Anonymity is a happy benefit. Engineering it for anyother purpose reduces its efficiency.

Incorporate in a foreign land, invest the money safely, issue and buy back shares according to a fixed formula that depends only on the valuation of the company, publish your returns and register the stock as securities in as many lands as possible. You now have a perfectly legal basis for digicash. The shares will float in the range of values specified by the stock issuance formula. They will gradually go up relative to inflation and will be easily traded in multiple currencies. And it will be really difficult for most governments to attack the "payable to bearer" nature of the currency because it would encroach on the rights of all American corporations. No?

Or, you can take money in over the window and turn it into digital cash denominated on a dollar basis, priced at that point with discounts or primia as necessary. Occam's razor.

...

In theory, though it probably won't happen, an underwriter could issue a greater amount of digital cash than regular cash paid for it ... [snip...]

This will once again make the value of the digicash dependent on when it was issued. An alternative formulation of this same scheme would have the value od digi-cash be invariant with the data of issue, but have periodic redemption dates on which the value of the digi-cash would jump. I find neither to be desireable.

That's true, but the difference in price reflects the estimated future value of that money in a suspension account plus the operating costs of the underwriter, not by some complex pricing methodology which makes the cash more difficult to use.

Market liquidity is increased by convenience to the holder of the securities, not the issuer of the securities.

I cash out my "digiDollar" today, it's a dollar. I cash out my digiDollar tomorrow, it's a dollar. I cash out my digiDollar the next day, it's a dollar. Looks pretty simple to use to me. (a digiDollar is a dollar is a dollar is a dollar) :-). [Oops. I went and concocted some more buzzy language. Occupational hazard. Don't worry, I'll try not to use it anymore, and maybe it'll die gracefully.] Cheers, Bob ----------------- Robert Hettinga (rah@shipwright.com) "There is no difference between someone Shipwright Development Corporation who eats too little and sees Heaven and 44 Farquhar Street someone who drinks too much and sees Boston, MA 02331 USA snakes." -- Bertrand Russell (617) 323-7923