E-MONEY (THAT IS WHAT I WANT)

The killer application for electronic networks is not video on demand. It will hit you where it really matters - in your wallet. That is not just revolutionizing the network, it will change the global economy.
The clouds gathered in Amsterdam as I drove into the city center after a day at the headquarters of DigiCash, a company whose mission was to change the world through the introduction of anonymous digital technology. I was inundated with the talk of smart cards and automated fee collectors and fake proof witnesses and virtual coins for anonymous network ftp. I copied my e-wallet and bought a bottle of soda from the DigiCash vending machine, but it was out of order.
My tour guide and guide is David Chaum, founder of DigiCash's whiskers and curls, and the inventor of cryptographic protocols that can enlarge our currency system in the century. 21. They can, in the process, break Orwellian's predictions about a Big Brother's myopia, replacing them with a world in which the ease of electronic transactions is combined with the Anonymously elegant payment by cash.
He pointed to the square where Nazis rounded the Jews to expel the concentration camps.
This is not an idle conversation, but a topic rooted in the persecution of Chaum Weltanschauung - the state has lasted to the maximum. David Chaum has devoted his life, or at least throughout his life, to creating cryptographic technology that frees individuals from the dreaded darkness of those who collect technical records. number. In the process, he became the central figure in the development of electronic money, advocating a form that fits a private model through which details of human life are sheltered. from the curious eyes of the state, the company and various unfortunate factors.
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Fifteen years ago, David Chaum seemed to be a Don Quixote in Birkenstocks, a lost computer scientist who was talking about a technology that seemed to originate from science fiction rather than finance. Today, there is still beard, but in a suitably fitted suit, he is standing in a seemingly unstoppable movement - digitizing money. His passion now is to explain that change does not have to be oppressive. He travels between banks and financiers, he runs a company, he proselytizes. And he hoped someone would listen, because the wild card in the money age was anonymous, and David Chaum thought we were in trouble without it.
Currency invoice or paper money bill
The next big step forward of the digital age is, quite literally, going to hit you in the wallet. Dollar bills that you fold and hide are directed toward digital streams encrypted by encryption, stored on a "smart card" (a plastic card with a microchip), an "electronic wallet" with a palm reader and a computer charger), or a hard disk of your computer, wired to buy sprees at the virtual mall.
Of course, real money - trillions of dollars spent by banks, other financial institutions and government clearing agencies every day - are numbers. No physical card exchange: all transactions are processed using bit streams. But digitizing the last mile of electronic money, where coins and dollar bill vinyl walks will make a difference in the world. It will not only change the way you spend your money, it will change the way you view your economy. And depending on how it's done, digital electronic money can allow others to view your finances with a dash of intimacy.
Is electronic money really going to happen? Ineluctable. Hard currency has been a useful item for a few millennia or so, but now it simply brings out its welcome. A recent article by some cryptologists at the Department of Energy's Sandia National Laboratory in Albuquerque, New Mexico, began by listing what electronic advocates identified as fatal errors. "The emergence of high-quality color copiers threatening credit cards and ATM cards is becoming more common, but these systems lack the proper privacy or protection against fraud. , leading to the need for effective electronic money systems to prevent fraud and also to protect user privacy. "
"Cash is a nightmare," said Donald Gleason, president of Electronic Payment Services Inc.'s Smart Card Enterprise unit. "It costs roughly $ 60 billion to ship goods, a ripe item, a solution that crams our currency into our pocket and hits a few games. Immediately, and the paper money will never go away (hey, they can not even escape the coin), but bills and coins will increasingly be replaced by some kind of electronic equivalents. "

The emergence of electronic money seems to require governments around the world to unite and implement a plan to make the change in an orderly manner. But that does not happen. In particular, the United States is issuing a state of ignorance. When I called a spokesman for the Federal Reserve to ask for electronic cash, he laughed at me. It's like I'm asking about exchange rates with UFOs. I emphasize that he looked at it, and finally he called me a few days later with the official word: The Federal Reserve did nothing in that area.
Outside the Fed, there are many in the government who care about those who have a disparate vision in the Treasury and Congress, in the Office of Technology Assessment - but while they think about it, many organizations Other are planning to knock out our currency prejudiced for a loop. A short timeline and when players look around and see what their potential rivals are doing, those timelines will be shorter, especially in the race to come up with plans to offer deals. on the computer network.
For beginners, there is CyberCash Inc., a group of cash digital cash technologies. According to Bill Melton, creator of the Verifone system, which manages credit card transactions between merchants and banks, principals include Jim Bidzos, president of encryption vendor, RSA Data Security Inc. , Steve Crocker, vice president of Trusted Information Systems Inc., and Dan Lynch, president and founder of Interop Co. (produced the world's largest Internet trading program). "We will provide secure, secure and convenient cyberspace cyber space," said Bruce Wilson, chief executive of CyberCash. In the first quarter of 1995, CyberCash will provide a network equivalent to debit card transactions, then expand to credit cards. Next step:
Visa has assembled a consortium of financial institutions to design "Mobile Phones", details for low-cost purchases at gas stations, convenience stores, grocery stores, fast food restaurants and homes. Eating school, in addition to regular items such as calls from pay phones, toll roads and bridge videogames.
Citibank has run prepaid card tests at a facility in Long Island. There is Smart Card Enterprise of Electronic Payment Services, where you want to cash in your ATM network.
There is a NetCheque project, a debit card system, developed by the Institute of Information Sciences of the University of Southern California. And there is the Information Network Institute, part of Carnegie Mellon University, whose NetBill is also based on the debit card model.
Many shipping companies have envisioned airfares to buy newspapers and aprons. Telephone companies issue phone cards with similar extensions.
In Danmark, Danmont has distributed more than 100,000 cards in cash to spend on things like parking and washing machines. Similar systems exist in Portugal and Singapore.
Mondex, a consortium led by two UK banks, will launch its digital cash system, with about 40,000 cardholders, to the public in Swindon, England next year. The creators of this system are spreading around the world, because people slip their smart cards into phones and wallets specifically to carry out transactions like cash, counterfeit, even cross-border. gender. Dave Birch, spokesperson for the project's consultants, said: "It's going to be so popular - it's the cheapest way to move money around." In Mankato, Mankato, Minnesota, students Provided "MavCards", including Ohio, which has a smart card system instead of electric benefits checks.
Finally and inevitably have Microsoft. For months, it has quietly hosted a digital money group, perhaps putting its own stamp on the emerging phenomena of digital transactions. But in October, things got worse, as it raised $ 1.5 billion to buy Intuit, a financial software company that decided to move to automate money. With the acquisition, Scott Cook, Intuit's general manager, became Microsoft's vice president of e-commerce - reporting directly to Gates, begging the question of whether the bill was in bronze. Will the dollar be replaced by Bill?
The result of this mad rush, the cash flow path is not a smooth transition path but a multi-lane meadow road with circles, circles and ends. "A lot of people think it's going to be a form of digital money," said Nathan Myhrvold, Microsoft's chief technology officer. "Today we have a variety of financial transactions, cash, checks, credit cards, debit cards, electricity bills, travelers checks ... each has a special feature. digital money ".
Kawika Daguio, a representative of the American Bankers' Association, is familiar with the matter and says, "In these days we may have encountered similar situations in the 1860s, before the Federal Reserve System Our banks, backed by different institutions, have not been widely accepted - they are circulated and are often discounted, and banks have also printed private banks.
Sholom Rosen, Citibank's vice president, said more frankly: "There will be winners and losers, but everyone will play." Michael Nash, senior vice president of Visa for pre-engineered products, recalled the excitement of executives in June last year as they witnessed the smart card credit card union test. At a retreat in Cancun, Mexico: "We have high-level bank executives lined 70 deep to try this!"

Considering all of these plans in total, one can imagine how money would work in the future. However, we have to distinguish between forms of e-commerce - including credit card and bill payment - and electronic cash, in which the money can be transferred, equally, widely accepted. Spacious and can be passed, peer through many sides while retaining value. You know, money.
First of all, imagine that all the use of credit and debit cards is seamlessly integrated into electronic format. Now start thinking about real money. Cash will be placed in the smart card by credit card can be stored in the wallet "electronic wallet" by the palm. The anxious days of accessing the ATM at 2 am, looking over your shoulder for the muggers, are over. You will download money from the safety of your electronic blog. You will use these cards in your phone (even in the house), as well as electronic wallets, save them whenever you spend money, check the cards in place to confirm that the merchant only receives the number. money you intend to spend. This amount will automatically be deducted from your deduction into the merchant. Cash will be a number, a digital certificate you '
Online commerce will recreate the process on cyberspace: you will load money from your bank, put it in virtual wallet and spend online. You will also be able to receive money from your employer, who buys something from you, or a friendly soul who lends you a virtual shovel until the day of payment.
Exactly what happens inside the smart card, wallet, and computer will be unclear. However, the protocols chosen by the eunuchs are very important. Depending on how they work, different electronic money systems will prove beneficial or disasters, the fortress of personal privacy or personal freedom violation. At worst, a faulty system or possibly cracking of electronic money can lead to a Chernobyl economy. Imagine the dark side: Scammers sneaky find a way to forge an electronic money system. A mint desktop! The result is the flood of bad numbers that will make the hyperimflationary Weimar Republic - where people carted full wheelbarrows to pay for grocery stores - looks like a steady currency system.
A privately circulated article written by Kawika Daguio outlines some issues in the form of questions:
Who will create monetary value?
In other words, who will pay back the money, guarantee confidence. Will it be the government? Banks? Visa? New York City Transportation Authority?
"A dollar is a piece of paper - what is the difference between it and a piece of paper?" Asked by Sholom Rosen of Citibank. "It was the ability to present that piece of paper and receive assurances of return, it was not backed up, it was time to be backed, but those times were gone. The bankers, the money supply is planted and disappeared in the banking system. "
However, others seem to think that, if universally trusted, a metric system of currency can float on its momentum. Eric Hughes, co-founder of privacy champion Cypherpunks, said: "If you have money online, you can make personal money online, and he is exploring the possibility of establishing a bank. The simplest is to not transfer money to paper if you do not have to. "
What security features will be included?
How will these systems protect against fraud? Can they be attacked or tampered with? What would be the balance between ease of use and security?
"Everybody has sticky fingers," says Rosen. "The most honest men in the world will find some money and put it in their pockets." When outsiders hear about digital cash, the first thing they say is, 'I'm going to break into' "
Of course, smart cards must be forged proof so people can not reverse engineers and spend double. Elemental protection is cryptography. "The debris in the container must move from one container to the other." When you finish, you have to have less in one container and more over the other. In addition, your transaction does not. How strong the crypto is depends on who will try to break if it is Mafia or a national government, they will have a lot of resources. "
David Chaum, for example, argues that some tough brown businessmen can break the experimental Mondex system in the UK. Although its mathematical protocols are very powerful, but according to many experts, too much depends on the card test. "A device can say, 'OK, I transferred $ 100,000 to you,' and another said, 'Oh, good, I believe you.' So if you break one of those open (beat the anti-counterfeiting technology) and tell it you have a billion dollars, the whole system just dies. "(Mondex stressed that the plan Its can not be broken, but will not provide more details) "Just say we are betting on the store," Dave Birch said.
Will they work so that the value will be restored if they are lost?
People seem to agree that smart cards keep cash numbers so offer an option to punch in a Personal Identification Number before buying something; But there is also the consensus that most people will not use that option. "Consumers will not mind," said Michael Nash of Visa. "The key here is that we imagine this as extending what you do with credit cards. We do not think e-wallets are suitable for those who buy jewelry or cars." In many systems - Mondex is a typical example - losing your smart card stored value is like losing a bill. Do not carry more than you can afford to lose.
Who will adjust electronic money?
At this point, all the players are proceeding as if no one is present. They extrapolate a management system that is growing out of now, while they are aware that as the digital economy becomes more prevalent, there may be requirements for restrictions and regulations. new. At present, the rush is to get everything in place, and not the traffic police seem to slow down anyone.
Who will pay for it?
"I do not believe that a reasonable policy to charge someone's right to participate in the virtual world is equivalent to putting their hands in their pockets, drawing a bill, and handing it over to someone," said Kawaguchi Daguio. He was particularly disturbed by claims made by the Online Media and Communications Group, a Virginia-based company, that it has patents (US 5,220,501) that "deal exclusively with electricity transactions. Real-time consumer use of any product at home terminal to purchase goods and services, payment of bills and bank through the network of debt, including the network of cash dispensers themselves Online sources also claim that "the patent covers all terminals in the house, including phones and computers." (Patents may be processed by banks and microprocessors.)
On the other hand, Microsoft's Myhrvold, perhaps expecting revenue from the license would make DOS look like a drop in the bucket, challenged Daguio's assertion, claiming that we had paid the equivalent fees. "Of course you do," he said. "Clearly or implicitly there is a fee associated with using cash, you have to pay for those costs, cash is expensive to move, you have to hire guards from Brinks with guns and All the dirty stuff. The price of what you buy.
The bottom line is that nothing is free, especially when it comes to money. You will have to pay electronically, either as a transaction fee or as in the CyberCash model, by allowing others to earn interest on your electronic money - even if it's in your virtual wallet.
In summary, different systems have given unclear or clear answers to some questions, and responses to others, such as regulatory mechanisms, will have to evolve. according to the idea. But one question remains open: the separation between privacy and traceability.
Hard cash, of course, is anonymous - you can spend your print invoice with the assurance that no one can track your spending or make a profile on your lifetime's spending records. . But electronic cash has no such guarantee. Intermediate through its computer makes the traceability process the least. This creates a provocative question: can cash become anonymous, as real world money is? And if so, is that so?
And these questions brought us back to Amsterdam - the headquarters of DigiCash, the company founded by David Chaum.
The digital currency
In the world of number cash, David Chaum is penny marked to be retained reappear. His ideas circulated freely as cash itself. He was a pioneer in this field, who transposed it from the ether of science fiction to the rigor of mathematical truth. But man himself is the center of controversy. All those involved in the bold attempt to break the dollar into mysterious mathematical formulas know Chaum, and almost all admire his work. But when they talk about their deals with him, they immediately come out of the record. It turns out that at one point they considered licensing Chaum's patent or at least recruiting Chaum's involvement in their project. These processes seem to have ended in ineffective conflicts, sometimes controversies. Then, surely, much of the negotiations.
Why are all these people working on David Chaum?
I get a hint one day after going with Chaum through Amsterdam. We had planned to meet at a cafe outside Keizersgracht.
Our plan is to spend the whole day talking about his money and his work. But before the recorder went on, Chaum was distressed to make me clear: he was not, as some teased him, some sort of secret. He is not a paranoid, but merely a person who has made some remarkable discoveries that people should know before they make irrevocable choices about their financial resources. .
Good, I say, and start the interview. Burn the tape. "How old are you?" I ask. "I do not tell people," he said.
Heart, David Chaum is driven by the ideal. Knowing the brain behind digital-earning work, he holds an important patent in the field, particularly in the field of anonymous cash, unable to look up. So he can become a very rich and powerful person. However, he avoided the least obstacles and the biggest income - by licensing his plan - because he was passionate about the potential of cash and wanted to be informed about the possibility of survival. Its spreading everywhere.
He said that if after knowing that there may be personal transactions, currency, people decide to spend their money with the same tracing ability as credit cards, he will accept the decision. But he did not think that would happen. His prediction is that when people are aware of the problem, they will agree that routes can track down the evil of all money.
From a very young age, David Chaum was interested in private hardware. "It is important to realize that there is a strong motive for me," he said. "My interest in computer security and encryption comes from my passion for security technology in general - like locks, burglar alarms and safes," he said. (As a graduate student, he designed two new designs for locks and was almost sold to major manufacturers.) And, of course, he was very interested in computers. In high school and college, he did the typical types of hackers: cracking passwords, diving trash, and so on. But he also received some serious grounding in mathematics. And last in his undergraduate career, he went to cryptography, a finding that in retrospect seemed inevitable.
Chaum's first major papers published in 1979 when he was a graduate student at the University of California at Berkeley showed a strong focus on his work: preserve privacy. His ideas are based on the notion of public key cryptography, the technique introduced by Whitfield Diffie and Martin Hellman in the mid-1970s that established cipher as a mass technology. In particular, Chaum is excited about using digital signatures - a way to validate the authenticity of the sender. He said, "I'm interested in these special techniques because I want to make anonymous voting processes." Then I realized that you could use them more generally as a kind of delivery. The trail can not be seen. "The trail leads to anonymous cash, unable to look up.
Have dinner with Cryptographer
For Chaum, politics and technology reinforce each other. He believes that on the issue of privacy, society stands at a crossroads. Moving in the direction of our present, we will come to a place where Orwell's worst prophecies are fulfilled. He described the problem in an essay called "Numbers can become a better form of cash." "We are rapidly approaching a critical and irreversible moment, not just between two types of technology, but between two types of society," the 1991 article said. . This article was published in 1991. "The current developments in technology applications are emptying both the protection of privacy and the access to and correction of personal data. If these advances continue, Their greatness will make the individuals'
In the early 1980s, Chaum conducted a seemingly unresolved search for answers that many did not consider the issue at first: how could the field of electronic life expand? without compromising our privacy? Or - more daring - can we do this and increase privacy?
In this process, he figured out how the encryption could produce an electronic version of the dollar.
To appreciate this, you must consider the obvious obstacles to such a task. The most recent concern of anyone trying to create a digital currency form is copying. As anyone who has copied a program from disk to a hard drive knows, it is perfectly trivial to make an exact copy of anything in a digital environment. What prevents me from getting my Digi-Buck and earning a million, or a billion, copies? If I could do this, my laptop, and every other computer, would become a kind of mint, and infinite super inflation makes this currency worthless.
The answer to digital copying lies in the use of digital signatures to verify the authenticity of the invoice. Only a serial number is assigned to an "invoice" - that number will be the invoice - and when the unique number is presented to a merchant or bank, it can be scanned to see if the invoice is virtual. Be real and have not been spending before. This is quite easy to implement if each electronic currency unit is tracked through the system at all times - but that will bring you exactly the kind of nightmare surveillance that gives Chaum the chills. How can you do this and unconditionally protect the anonymity of a person?
Chaum started the solution by finding something called a "blind signature," a process by which a bank or any other authority could validate a number so that it could operate. as a currency - but the bank itself does not know who has the bill, and therefore can not track it. This way, when the bank gives you a quantity designed to be accepted as cash, you have a way to change the numbers while maintaining the bank insignia.
One of Chaum's breakthrough breakthroughs occurred when he found evidence - albeit for another - that this type of anonymity could be provided unconditionally, with all assurance of mathematical proof that no one can violate it. The idea came when he drove Volkswagen from Berkeley to his home in Santa Barbara, where he taught computer science at the University of California in the early 80's. "I moved this idea over the head, and I went through socks All sorts of solutions. I continued to go through it, and finally when I got there, I knew exactly how to do it in an elegant way. "
He presented his theory with a vivid example: a scenario of three cryptologists waiting to be examined after finishing the meal at a restaurant. Waiter appeared. Your dinner, he told the cipher house, was paid in advance. The question is by whom? Has one of the dinner people decided to anonymously name their colleagues - or have the National Security Agency paid for the meal? The dilemma is whether this information can be gleaned without affecting the anonymity of the cryptographer who may have paid for the dinner.
The answer is quite simple. It involves throwing coins from certain parties. For example, A and B can flip a quarter behind a menu so C can not see it - and then each person records the result and passes it on to him. The main rule is that if one of them is the culprit paying for the meal, he or she will record the opposite result of the coin. So if C receives a contradictory statement about a coin - one end, one tail - he will know that one of his co-workers has paid for the meal. But if there is no other conspiracy, he will not know how. With a coin collection and mixed message, any number of diners can play this game. This idea can be extended to a monetary system.
"This is really important, because that means that resourcefulness can be unconditional." "Mathematical sense of bulletproofing." It does not matter how much power the NSA has. break the code - they can not figure it out, and you can prove it. "
Chaum's next work, as well as the patents he has successfully applied, continues to build upon those ideas, addressing issues such as double spending while keeping anonymity. In a clever mathematical transformation, he came up with a plan in which anonymity of a person would always be preserved, with one exception: when someone tries to spend double a single they have gone elsewhere. At that time, the second bit of information would allow a trace to be revealed. In other words, only scammers will be identified - in fact, they will provide evidence to enforce the law on their fraudulent effort.
This is an interesting job, but Chaum has received little encouragement to pursue it. "For many years, I have had a hard time working on this kind of topic in this area, because people are not comfortable," Chaum said in the early 1980s. Individuals with the top lights in the privacy policy and share their ideas with them.
"The uniform reaction was negative," he says. "And I could not understand this. It made it all the harder for me to keep pushing on this, because my academic advisors were saying, 'Oh, that's political, that's social - you're out of line.' Even the department head at Berkeley said, 'Do not work on this, because you can never tell the effects of a new idea on society.' I acknowledged him in my dissertation, saying it was the rethinking and finally the rejection of this principle that caused me to do this work. "
Finally, Chaum decided that the best way to spread the idea was to start his own company. He was living in Amsterdam at the time. During his visit with his Dutch girlfriend, he met some scholars at the CWI, the Center voor Wiskunde en Informatica, the Netherlands-funded Dutch National Center for Computer Science and Mathematics, where he was set up cryptographic team. So, in 1990, he launched DigiCash bv, a subsidiary of DigiCash Inc., with his own capital and a Dutch government contract to build and test technology to support. Anonymous toll payments on the highway. Chaum has developed a prototype through a smart card that has a verified amount of cash that can be slipped into a device attached to the windshield, and high speed scanning devices will subtract Road tolls are like troublesome cars. These cards can also be used to pay for public transport and eventually other items. Of course, payments will be anonymous. After the completion of the contract (the system has not yet been deployed), Chaum keeps the company active in smart card applications; Some projects focus on cash systems that can be used in a building or complex of buildings. DigiCash headquarters, along with a number of businesses and agencies in the Netherlands, use the current system. But so far, the company's operations are still relatively small, even as the world has now come to see the importance of the ideas Chaum has hatched. DigiCash remains independent, does not have a close alliance with a major partner in banking or financial services. Chaum feels that at such time partnerships, at least licensed by DigiCash technology, will emerge; If so, your model will be an important factor in maintaining privacy in the electronic money age. This is an idea that Chaum believes is worth cherishing.
Some people explain this as stubbornness, or poor business practice. "People wanted to buy David's patent but he demanded too much - he wanted control," said a former DigiCash employee. "The real issue is that privacy is not what banks want, it's not what the store wants. They want something easy to use, fast and very cheap." (However, this source speculates that Chaum "has lasted so long that he will probably succeed.")
Frustrated by the inability to use Chaum's patents, some companies have built their own anonymous plans, which may or may not violate Chaum's. More recently, Stefan Brands, formerly of CWI, has come up with an alternative plan that has garnered considerable attention. Brands claim that the system does not violate Chaum's patents; Chaum's careful reply was, "He did not convince me that it did not happen."
The subject of the patent is touched; Chaum rode at any conversation with him with the robber-baron. In my mind, turnover is secondary to the potential effect on society. "My job is to do this, because I have a vision like this, and I feel it is my responsibility to do that." I was stuck, they gave me some time. We can not license, really, no patents, the whole purpose of them is to get this stuff out there. "
Hidden value
Is anonymity really important when it comes to electronic money? Some people overlook the meaning of it - or that anonymity is a bad thing.
Says Kawika Daguio of the American Bankers' Association, "It's a dangerous and dangerous policy to allow unlimited digital currency, not limited to production." In the material world, money is cumbersome. In the material world, it is possible to follow people, so a catcher may be arrested if the currency is marked, if the money has been observed locally. Points, or if the serial number is recorded, cash anonymously can completely allow the opportunity to forge and fraud. "
Nathan Myhrvold of Microsoft agrees. "There is an important role for unavoidable transactions, but that is not a panacea. There are some people who work very hard but have a very stable trend from impossible cash. I want them to track it All this is a reason They do not have as part of a plan of Big Brother not serious.View, I understand Chaum of a concern to a That's a lot of concern for but I'm worried about the idea of ​​saving people from themselves. Just because I sign up for a money template does not mean I want my neighbor's side to see the deal. mine "
Mr. Chaum said he had never argued about the totality of the impossible, but was a limited anonymity. "My job was to try to set up a whole space of possibilities, limited by complete anonymity completely on one side and perfect identification on the other."
Chaum is not the only one working in the field: building his ideas, researchers at Sandia Labs have worked on a program to try to balance anonymity with the need to enforce the mechanism. Law enforcement to track criminal transactions. Sort of an anonymous clipper, digital cash. "I'm concerned about some of the effects of electronic money on criminal activity," said Sandy, "It can make it easy for people to kidnap and extort money. Maybe a kidnapper and ask for a change of money in a way that does not involve physical exchange - you will not know the country where the person immigrated. There is also potential for new types of criminal activity to emerge.
However, it is not clear that even this type of anonymity is limited to increasing, er, currency. Users of electronic cash - the public - may never be asked whether they like it to be anonymous. Brickell acknowledged that anonymity would be a good sell. "There is a lot of information about people floating around, that we want to protect our privacy as much as possible," he said. "But some banks feel that an anonymous system will never make it, or even something they can get behind." In fact, Niels Ferguson, the coding house for DigiCash, said, "The real decision makers are often concerned about not protecting the privacy of people because they are one of the people who have the opportunity. collect information."
But what of Nathan Myhvolds, who seems to argue that they want to retrieve? Ferguson sighed. "Oh, the number of times I have to argue with people that they need privacy. They will say," I do not care if you know where I spend money. "I often tell them, 'What if I hired a private investigator to accompany you around the clock?' Are you angry? ' And the answer is always, 'Yes, of course I will be mad.' And then my argument is, "If we do not have privacy in our trading system, I can see every penny - every cup of coffee you drink, every Mars Bar you get. , each Coke you drink, each door you open, each phone if you can see it, I do not need a private investigator.I can only sit behind my terminal and follow you all day. "And then people started to realize that, yes, privacy is really important, and any piece of information may not matter, but it's important to collect information."
That is exactly why some officials are licking their pieces at the prospect of money can track. They include, of course, law enforcement agencies, who are more desperate to see the money removed. What would the drug dealers do? Money laundering? Underground economy? They would argue that the inclusion of digital cash would provide an asset to the kidnapper, scammer ... criminals of each strip. But consider a world where all money is electronic and accessible, and you have the strongest anti-crime weapon in history.
The most profitable organization is the Internal Revenue Service. The computer age has been very good for the IRS, now it has access to any number of databases that can actually check for any citizen's tax return. Cash trackability will accelerate this process, and tax authorities can not wait to take advantage of it. In a recent speech - presented on April 15, no less! Coleta Brueck, project director of the IRS's Text Processing System, describes some of the IRS's plans. These include the so-called "Golden Eagle," in which the government automatically collects all aspects related to a person's finances, categorizes them into the appropriate categories and then calculates the higher tax. "A service," as Brueck said. This information will be provided to other government agencies, as well as states and municipalities, that will draw it for their own purposes. She vowed "absolutely" that this would happen, assuming that Americans would feel less of a tax burden. The government will simply accept it.
"If I knew what you were doing in a year, if I knew you were tax deductible, if I knew what your spending pattern was, I would be able to give you a tax return," she said. Your boss tells us everything about you that we need to know The profile of your activity on the credit card tells you everything about you that we need to know Through the interface with Social security, with DMV, with your banking institutions, we really have a lot of information, so why ... at the end of the year or April 15, we asked the Post Office to do it themselves I was shocked with the large number of people on it, with the piece of paper that you have to pay? ... I do not know why. We can send it back to you
It is not the future that David Chaum wants to go, and in hopes of hindering openness in the work of an individual, he continues to patience in his crusade for security.
Megabucks on the net
Virtual space is destined to be the first battlefield of the digital currency war. Although it may take many years to replace the hard currency in the physical world, the virtual world can not only meet the current system, but is desperate to perform the digital equivalent. Everyone agrees that the Internet is the foundation for the first real boom in e-commerce, but it's a wasteland transaction. You can not buy anything without a credit card. You can not even make a bet with a $ 2 friend.
It is here that the difference between electronic and electronic money becomes apparent. Network equivalents of some types of credit cards and e-commerce debit cards are currently underway. One of the major driving forces behind this initiative is CommerceNet, which is expected to provide infrastructure for other transactions, through encrypted credit card payments. These commands will work exactly like regular credit card transactions, except the actual account numbers will be replaced so eavesdroppers are called packet thieves can not intercept them and real currently charges illegal. Sort of the equivalent electron of crumpling onto the carbon atoms.
Of course, these transactions are officially tracked - Cathy Medich, "When you buy something, the seller is identified as the buyer."
Although this is certainly useful, Net's open architecture requires a more cash-like system. Why only pre-approved businesses are officially merchants able to sell? Why can not people transfer money to each other? "If I owe you $ 25 and say," I like it, I have a credit card in my wallet, "What can you do?" asked Bruce Wilson, CEO of CyberCash. "You can not do anything, you're not a merchant, it's a situation in the online world, with virtual stores and countless potential entrepreneurs who can not handle credit cards. People want to sell a limerick in the day. The weather servers with satellite images They need a cash method. For these people, anonymity is not a problem. It's simply a matter of paying the bill. You are with me, you with a relative. That's why we have a cash requirement. So if Wired Magazine has a repository of posts about a server , and a researcher was sitting somewhere at 2am looking for the net, he could say, 'Oh, this is the five posts by this expert Ste. Levy. And he can download those articles. "For a dollar, one dollar is fifty-two percent of an article. He's happy to have it!" And he can download those articles. . For a dollar, a dollar fifty two-fifth an article. He's happy to have it! "And he can download those articles." For one dollar, one dollar fifty-two percent of an article, he's happy to have it! "
CyberCash, of course, is planning to offer a system that will make cash on the net, but is reserving the verdict about the level of anonymity it will use. "If the market is looking for anonymity, our service will not be used if it does not offer it to a sufficient degree," Bruce Wilson said. "If it never becomes a problem, it will not need to be there." For our cash services, we plan a middle-of-the-road approach. "
Meanwhile, there are "e-cash", which is provided by David Chaum's DigiCash. Anonymous is at the heart of e-cash, working with Windows, Mac and Unix clients. I played with a test version in Amsterdam and found it easy to use - as simple as reaching in my pocket and buying something without leaving a trace of numbers. The ease with which this shows all electronic programs, is actually: mundane on the surface, but can be repulsive or subversive below. A simple example: If Chaum's plan can be used to download thousands of documents available on the World Wide Web, anyone can start a small business by selling files. at a low price - say 10 cents, 25 cents a share. Finally, as bandwidth increases, information in all types of formats - like audio and video - can be provided by cash. And there are no traces of the buyer - the seller can not automatically choose your purchase interest on the mailing list. Governments can never track your reading preferences. Or, frankly, you lack tax payments. While replacing, everything can be traced.
Electronic cash is deployed on a trial basis at the beginning of this fall (http://www.digicash.com/). Each user, upon signing up, receives $ 100 in CyberBucks. This can be sent to friends and acquaintances or spend with coins, simply by clicking on a mouse.
How to fight back - click "OK" to fork on the fund! But not to the user, a miracle is happening. The computer cycles are intense rhythm that expresses the dream of David Chaum. Money safety, accuracy, unconditional. This is a testament to the notion that the future is not necessarily the place to shop for consumers.
At the time of the press, DigiCash had counted 15 businesses and organizations around the globe, including the Encyclopaedia Britannica, ready to set up "stores" that would sell information for e-cash. Perhaps, these new virtual stores will raise the level of sophistication of the system from its initial state, meaning that electronic cash is the pioneer of a new, relatively normal financial system. Among the first places to spend CyberBucks, one of which is the DigiCash store (where you can purchase Chaum's "Achieving Electronic Privacy," Scientific American, 1992, for $ 2.84 cash). . Another one is something called Monty Python Storage Store of the Big Mac, which offers natural copies of Monty Python movies and routines for various incremental steps of CyberBucks.
In a sense, that independent admission becomes the center of electronic money. If anonymity becomes a standard in the virtual cash system, we must accept its potential abuse - as in piracy, fraud and money laundering. The new secret plans have the potential to reduce these abuses, but the fact that anonymity ensures that some fraudulent behavior is easier. On the other hand, missing anonymity means that every move you make and every file you make will be accessible. That opens the door to surveillance as we have never seen it.
"You have to let your readers know the importance of it," Chaum told me when discussing online anonymous cash. "The choice can only be made once." He thinks that if an economic system tracks all transactions to cyberspace, the results will be much worse than the situation in the physical world. "The virtual space does not have all the physical limitations," he said. "There's no wall ... It's another place, scary, strange, and with that identity a terrible nightmare. Terrible, everything you do can be known to anyone else, can be recorded forever. democratic mechanism ".
David Chaum believes that, as he wrote in an article in 1992, that "in the direction of unprecedented surveillance and control of people's lives, on the other hand, guarantees parity between individuals and The shape of society in the next century may depend on the prevailing approach. "
How An Anonymous Electronic Money Works
Smart card

1. Alice wants to fill out her empty smart card with electronic money that can not be obtained from her bank. She inserts her card into an ATM slot just like in a machine at home or on the street. The gold chip on the card sends a random key to the bank in a digital "envelope". The bank signs the envelope with the signature, ensuring that the "money" inside can be trusted. Think of the envelope as having carbon paper. The external signature will move to the inner sheet without the bank knowing the destination of the money. Then, the bank sends back the envelope back to Alice's smart card, removing the envelope, leaving a complex code. Alice now has anonymous money.
2. Alice can risk Go to the world and spend your electricity bills whenever she wants - like bus fare, at a shop in a shopping mall, in a car park, or even lend money to a friend, slip a card into your wallet "electronic wallet" yourself. "3. The anonymous e-money recipient copies the mathematical amount from Alice's smart card chip and then her computer adds her account ID number to it. Send to the bank. (For added safety, the bank may send the confirmation back to the receiver, but not necessary.) The bank then records the bus company, store, city, or you. The bank can not track money for Alice. The transaction takes place on the motherboard of any computer logged on the network.
3. Alice's computer contacted the bank, anonymous money.
4. She can send her e-money anywhere the e-mail message can quickly and quickly reach a mail-order department, a collection agency, her mortgage company. or some children publish a brash electronic magazine.
5. The recipient then sends the money e-mail to their bank account where the money is ready to be made into e-money again.
   Both smart cards and networks meld into a system. People who read the computer slot will allow them to spend money from smart cards or fill in smart cards with money earned on the net.