Making Money in Digital Money

[Adam Shostack]

On Fri, Apr 25, 2003 at 10:56:02PM -0700, Tim May wrote:

| * In my view, not necessarily the view of everyone in the DM community, 
| the Big Win for solid DM is in illegal markets, e.g., buying and 
| selling child porn, bestiality, snuff images, etc., and in untaxed 
| betting, buying and selling corporate information, and all the things 
| which untraceability of a very strong form is needed for. Again, this 

The online gaming industry and the adult entertainment industry both
have very large problems with payment repudiation.  Both understand
that their customers have a desire for privacy.  These industries will
provide the bulk of your business for a while.  So there are horsemen
using it?  Horsemen use cars, as we've pointed out for a long time.

I think it's possible to solve the 4-player ecash problem using porn
and gambling as your first merchants.  Offer a substantial discount to
players using ecash (which they make up in loss reduction).  Do it in
London, where they're not so moralistic and taxing as in the US, and
where there's a single regulator.

I've said it before, but I'll say it again: Law enforcement was not
the large problem that you predicted for ZKS.  The large problem was
that the problem we were solving was that most people don't understand
the privacy threat from internet monitoring.  They don't understand
how it works, they don't understand what can be gleaned, and so
they're not really all that concerned.  Related to this, what people
think they know about internet privacy mostly revolves around cookies,
credit cards, and identity theft, and thus Norton's personal firewall
with a cookie manager sells well.

However, I think that its possible to create a system that uses the
real-time settlement to bring merchants suffering from fraud on board,
uses privacy to bring the users on board, and uses fees to bring the
banks on board. If only the patents were all expired..

Adam

-- 
"It is seldom that liberty of any kind is lost all at once."
					               -Hume