Finder's Keepers, Smartcards, Anon Cash [Re: double-spending prevention w. spent coins]

[Bill Stewart]

At 03:05 PM 04/26/2003 -0700, Major Variola (ret) wrote:
>Clearly the most anonymous systems (cash)
>have the 'finders keepers' property, *necessarily*.

         Ok, Major Variola has demonstrated that he's either Not Tim,
         or is Tim trying to make it look like he's Not Tim :-)
         He's also Not Even Hettinga, nor Adam, nor Choate....
         ... is that you, Lawrence?

>But one can imagine anonymous systems that are useless to finders,
>e.g., a smartcard with a real PIN and/or fingerprint reader.

         Fingerprint reader?  No thanks; aside from their technical weaknesses,
         they're rather at cross-purposes to anonymous digital cash.
         Do not double-spend by looking into laser with remaining eyeball.

         You don't even need a smartcard; a data file format that uses
         some kind of password-based encryption is enough.
         Smart cards, or dumb cards, may or may not be a useful adjunct
         to some digital cash systems, but one of the big reasons for using
         digital cash instead of 500-Euro banknotes is for online transactions.
         Smartcards may let you use your digital cash at somebody else's 
cash reader,
         and may reduce the risk of software problems trashing your cash,
         but digicash isn't necessarily something most people will carry 
around.

>In these cases, it is advantageous to the finder to return the
>smartcard in hope of a reward, IFF the loser makes this possible.

         Now, *that's* an interesting suggestion.

>Maybe there's a bizmodel in being a clearing house for lost locked
>smartcards, without trashing their potential "bearer" anonymity unless
>the loser tells the clearing house they've lost it.

         Not any time soon :-)  It's much more likely that the issuing bank
         or the wallet vendor would be in this business than a third party,
         and there are problems like how to preserve the anonymity,
         how to know the card has enough cash in it to justify a reward
         (I suppose you can guess that from whether the owner sends in a
         reward offer to the clearinghouse), how to escrow the reward 
payments, etc.

         For some sets of applications, you could do just as well peer-to-peer;
         have the finder post to Blacknet that he possesses a card with
         a serial number that hashes to 02198734, the owner sends a few
         digits of the serial number or a keyed hash to confirm,
         and they agree on a mailbox to snail the card to and a reward price,
         maybe 50% paid before and after delivery or using an escrow service,
         Obviously, the serial number can't be revealed in transactions,
         so maybe it's just printed on the front, or maybe it's used in the
         encrypted file formats on the card as a PIN-strengthener or something.
         If you like creeping featurism, you can design the card interface
         to have multiple money compartments, including one that you use
         to store $20 to pay off finders of lost cards...

         Or you just limit use of smartcards to money you're willing to lose,
         or are only storing in the cards when you're planning to use it,
         e.g. downloading a few hundred bucks to take to your coke dealer
         which reduces the incentive for robbing you before you make the buy.