Geodesic Payment Systems? (was Re: Meeting notes from ANSI X.9 Meeting on Electronic Payment)
Peter Monta
pmonta at qualcomm.com
Wed Dec 6 13:53:18 PST 1995
Wei Dai writes:
> > [ infinite-cost risk ]
>
> ...
> The direct cost of a break-the-bank catastrophic failure is bounded by the
> amount of capital the bank has. This is because the market will not
> accept more liabilities (real or forged) from the bank than its capital.
> There may be other indirect costs resulting from dislocations, but these
> should also be proportional to the size of the bank. Therefore your
> argument is really against centralization and for diversification and
> distribution.
Why "the bank", rather than "all banks"? If there is a single
cryptographic point of failure in a widely used ecash system,
it seems unlikely that diversity would buy you anything. The
worry would not be the compromised keys of a single bank, but
rather, say, an effective cryptanalysis. I would put this in
the supernova class; it may be just as unlikely.
Peter Monta
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