Darren New:
If I give you a dollar for an online newspaper and the newspaper never gets to me, or I give you $50 for a textbook and the textbook never shows up in the mail weeks later, who do I go to to get my money back?
This is a bad-case scenario, since it involves long delay and delivery of goods that, unlike information, have a nontrivial marginal cost to the merchant. These both give the merchant incentive to skip the delivery step. For this kind of business, there are several possibilities, none of which is mature enough to have actually been deployed yet (which is why ecash is currently aimed at small, immediately delivered goods and services). * Escrow services, which take responsibility for delivery each way (and develop a public reputation for reliably doing this). This has the value that it still allows the parties to be mutually anonymous (although additional tools are needed to actually have strongly anonymous connections, the payment/delivery protocol doesn't preclude it). * Ripped bill protocols might be able to substitute for escrows. (these are quite esoteric, but can again be hidden behind a nice metaphor). * Deal only with a jurisdictionally reachable merchant and hope the law is on your side (often not an available solution on the global Internet, but usually assumed by identified payment schemes, so it's a reasonable fallback from that point of view). For smaller transactions with rapid delivery times, complaining loudly and publicly on Usenet will soon put the business out of it. Receipts will give such complaints more credibility, and will also allow the clearing agent to credibly get involved. (Obviously in these cases anonymity is lost for a particular transaction, but unlinkability with one's unchallenged transactions remains). Finally, in a few markets the value add of confidentiality is enough to outweigh the risks for even large transactions. Nick Szabo szabo@netcom.com
Darren New:
If I give you a dollar for an online newspaper and the newspaper never gets to me, or I give you $50 for a textbook and the textbook never shows up in the mail weeks later, who do I go to to get my money back?
This is a bad-case scenario, since it involves long delay and delivery of goods that, unlike information, have a nontrivial marginal cost to the merchant.
Well, the online newspaper is certainly information.
* Escrow services, which take responsibility for delivery each way (and develop a public reputation for reliably doing this). This has the value that it still allows the parties to be mutually anonymous (although additional tools are needed to actually have strongly anonymous connections, the payment/delivery protocol doesn't preclude it).
If you can do this, then you don't need an anonymous payment system, do you? If you want to go through a trusted third-party escrow agent and that agent doesn't know what you're buying, why do you need to hide what you're spending it on? How is this different from the bank being the trusted third party holding your money in escrow anonymously? If the escrow agent knows who you're buying from and who you're selling to, you've lost the anonymity. If the escrow agent doesn't know what the goods are and doesn't know who is exchanging the goods, then you don't need to pay that agent anonymously.
* Ripped bill protocols might be able to substitute for escrows. (these are quite esoteric, but can again be hidden behind a nice metaphor).
I still think that at some point, either you have the money before the goods or the goods before the money. Basic Byzantine General problem, yes? In addition, if it's online cash, I have to clear it with the bank before I know it's any good. I read the Certified Electronic Mail paper, and (while I didn't follow it all) I didn't see how that solved the problem.
* Deal only with a jurisdictionally reachable merchant and hope the law is on your side
And... how do you know? How do you know that the LLBean website that's taking your money *is* LLBean? (Probably TM's in there somewhere.) I can set up a web site, run it for three days, and walk off with a bunch of money, can't I? How can someone distinguish this from LLBean having shipping delays?
(often not an available solution on the global Internet, but usually assumed by identified payment schemes, so it's a reasonable fallback from that point of view).
First Virtual assumes that the seller loses in the case of a dispute. Bearer instruments assume that the buyer loses in the case of a dispute.
For smaller transactions with rapid delivery times, complaining loudly and publicly on Usenet will soon put the business out of it.
That's assuming the business meant to stay in business in the first place. Ever hear the one where you wheel the fake ATM machine into the mall for one day?
participants (2)
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Darren New -
szabo＠netcom.com