The Crypto Winter

[Dr. Evil]

> 6. The failure to get true digital money. Call it what you like, 
> "digital cash" or "ecash" or even one of Hettinga's pet names, but the 
> fact is that for both political and technical reasons we don't have 
> digital cash. This has ripple effects for nearly all of the constructs 
> which depend on digital money: data havens, good remailers, black nets, 
> beacons, and of course for certain sociopolitical implications of 
> untraceable transactions.
> 
> Without this basic building block, we are left just with the "privacy" 
> stuff...and the privacy stuff is both fairly boring and at the same time 
> wrapped-up in legal/political baggage about secrecy, hiding things, etc. 
> Boring!

As someone (Bob, perhaps?) says, financial crypto is the only kind of
crypto that matters.  Other things are interesting and useful, but
this is the big one.  Let's recap Tim's definition here: the financial
crypto we're talking about here is anonymous unlinkable holding of
value and untracable anonymous transfer of value.  That's what we're
talking about.  The math and the technology are there, but it hasn't
happened, and it isn't any closer to happening now than it was ten
years ago.  In fact it's even further away from happening.

There have been endless discussions of why it hasn't happened, but the
bottom line is, various powerful heavily-armed groups (tax collectors
and their beneficiaries and many others) would lose literally billions
or even trillions of dollars if that happened, so they will put
infinite pressure on anyone who tries to do it.  If you thought that
you were going to lose a billion dollars, what wouldn't you do to stop
that, especially if you have the legal power to use deadly force,
write laws, and throw people in jail?  Therefore, the operators of the
scheme need to be anonymous, hidden, or hiding in a cave in
Afghanistan (er, maybe that doesn't work anymore).  Anyway, there are
serious barriers to trusting people who are anonymous with your life
savings, and there are serious reasons why such a system may never be
stable.

So, is there a way to get the system to work?  There may be ways, but
it's going to be a trick, and until that happens, all the other fun
crypto-anarchy stuff won't go anywhere.  This list is full of
predictions, and here's mine: no anonymous digital cash will exist
anytime soon (the next year, or five or ten years).

The world goes on the way it always has!  If you think back to humans
evolving as small tribal groups, certain distributions of behavior
were needed: we needed leaders, grunts, artists, craftsmen, risk
takers, risk avoiders, freaks, and many other types.  We don't live in
tribal groups anymore but we still have that distribution of
behaviors.  Maybe financial crypto doesn't fit into this kind of
distribution because it's too great a challenge to too many people.
Financial crypto would let people bypass the leader-controler types in
many important ways.