Illusional delusions

[AARG! Anonymous]

The solution for money laundering is to remove the "money", as defined
by the state, from the equation.

Crypto removes the content from everyones's eyes except the two parties
that communicate. That is what crypto can do. The moment one wants to
convert some bits to state-money she is doomed. If you want to
rely/convert at any point to the state-money you will become a money
launderer/terrorist/whatever. There is simply no way around this. Paper
cash is not a solution, since it is observable. Anything observable is
not a solution.

This is a fundamental problem - not unlike futile attempts to stop
copying the content one can hear or see, or to invent foolproof
watermarks.

Instead, we need a new principle that will not include state-money in
any form or shape.

Thinking aloud ... this may be silly:

Let's start from something that works - secret key message exchange,
maybe enhanced with PK key exchange for the carefree. A person, by
defintion, trusts itself, so currency known only to the two parties
should be reasonably safe. Every pair of traders have their own
currency. A disbalance (A owes B but C owes A) is resolved by creating
new B-C currency. There is no anonymity, but the network is hardly
connected and therefore reasonably safe. The system is hardly new but it
was never done in software AFAIK. You never do business with someone
whose reputation you can't instrument. But someone can start a business
for reputation building. Again, hardly new.

This doesn't enable global trade, but frankly I don't care. I don't gain
much from it anyway. Going through a series of intermediaries to buy
some fine Afghan pot is a small price to pay for getting out of the
state's sight.

In other words, with small transistors and digsigs there is no need for
centralised money at all. No more mainframes, thank you. Big business
will suffer, but somehow I don't feel sad.

So, tell me, is this silly ?