Digital Currency

Corey Edwards tensai at zmonkey.org
Mon Jul 2 17:07:03 MDT 2007


On Mon, 2007-07-02 at 11:44 -0600, Michael L Torrie wrote:
> On Mon, 2007-07-02 at 13:39 -0400, Jonathan Ellis wrote:
> > That's why it's called science _fiction._ :)
> 
> Well Daniel wanted to know if it was really possible, though.  I'm
> saying no it's not for the following reasons:
> 
> - nothing can ge guaranteed to be not counterfeit-able, although public
> key encryption can maybe help
> - anonymous digital currency transfer is not politically feasible
> - digital currency transfer (cash or no) requires a strict double-entry
> system, which can't be done on peer-to-peer, anonymous transfers of
> tokens
> 
> In short, digital cash holds as much promise as DRM.  Yes it is science
> fiction.

The key difference between DRM and anonymous digital cash schemes is
that with DRM you want end-users to have access to the encrypted content
without actually having access to it. The concept is fundamentally
broken and cryptographically is a joke. Either you have the key and can
decrypt, or you don't. You can't have it both ways.

With digital cash the parts the secret and unsecret parts are clearly
delineated and there's no confusion between the two. In Jason's example
(a great write-up, BTW), if Alice never double spends her coin, she
never gives away her key and thus the money is not decryptable. Only
when she tries to cheat does she give up the key and then the whole
thing is wide open.

I do agree that the political and corporate will to implement such a
system is nearly zero, if not completely. It's a shame really. The tech
is so cool, but as we know that's rarely a measure of success in the
market.

Corey





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