From: Duncan Frissell <76630.3577@CompuServe.COM>
Date: Mon, 14 Jun 93 14:19:35 PDT
To: <cypherpunks@toad.com>
Subject: Digital Cash$$$$
Message-ID: <930614200936_76630.3577_EHK40-1@CompuServe.COM>
MIME-Version: 1.0
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L;>INTERNET:cypherpunks@toad.com;Digital Cash$$$$
(J. Michael Diehl)
 
>>>1. How does one start a digital cash economy?<<<
A digital cash economy doesn't have to be separate from the regular economy.
 
        1.)     You mail cash/MO to First Digital Bank of Cyberspace (at an
offshore
        maildrop) together with a public (unique if you like) key and anonymous
email
        address (on Julf's remailer perhaps).
 
        2.)     The Bank opens an account denominated in the (traded) currency
of your
        choice or a commodity (gold).  There is no reason not to use existing
monies to
        back digital cash.
 
        3.)     You request digital banknotes and the bank emails them to you as
detailed in
        David Chaum's Scientific American article.
 
        4.)     You find someone to accept the digital cash.  Initially it can
be used for
        gambling and telecoms/storage fees, eventually buying digital goods
(software,
        print, audio, video, VR) will be easy.  Remember, within a few years 100
million
        homes in OECD countries will have 1.5 megabit lines into them.  This is
a huge
        market for digital entertainment.
 
        5.)     After a bit of development when the First Digital Bank of
Cyberspace cuts a
        deal with a physical offshore bank, it can issue VISA debit cards and
ATM cards in
        a  Nome de Guerre.  This is already done for large depositors, the nets
make it
        possible to do it for all.  You can then access your account from any
streetcorner
        in the OECD.  Remember money market funds are pseudo banks these days
with VISA
        cards and check writing and all.
 
        6.)     If you want to close your account, and you can't find any way to
spend your
        money as digital cash, you can have funds wired to a regular bank
account you
        maintain in a Nome de Guerre, have it wired via Western Union with a
code phrase
        because you've 'lost' your ID (for small amounts), have it wired to an
out-of-
        country bank in your truename and go pick it up in person, arrange a
gold purchase
        from a dealer somewhere and have the funds sent to him by wire or draft
and take
        physical delivery of the gold.  (There are many other techniques known
to privacy
        experts).  Eventually there will be plenty of moneychangers on the nets
happy to
        take your digital cash.
 
Most money is already digital.  The digital cash technology just gives us a way
to make
easy financial transfers over public networks.  If there is a demand for
economic
transactions over the nets, the money will be supplied.
 
******************************************************************************
* DUNCAN FRISSELL                       Attorney at Law, Writer, and Privacy *
* CIS 76630,3577                        Consultant since the Nixon           *
* Internet 76630.3577@compuserve.com      Administration                     *
* or frissell@panix.com                                                      *
* Easylink 62853962                                                          *
* Attmail !dfrissell                                                         *
* TLX:  402231 FRISSELL NYK                                                  *
*                                                                            *
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*          "If Mohammed A. Salameh had seen me in January, he'd be           *
*           vacationing in Tunisia today."                                   *
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