From: zeek@IO.COM (zeek)
Date: Sun, 10 Oct 93 00:19:37 PDT
To: austin-cypherpunks@mcfeeley.cc.utexas.edu (acp)
Subject: The Bank of the Internet!? (fwd)
Message-ID: <9310100715.AA27486@illuminati.IO.COM>
MIME-Version: 1.0
Content-Type: text/plain




No, I didn't read this entire message, but I thought it may be relevant...

Forwarded message:
*> From dummy Wed Feb  29 12:12:12 1990
*> X-EB: ------------------------------
*> Date:    Fri, 8 Oct 1993 16:01:46 -0700
*> From:    Arthur Chandler <arthurc@SFSUVAX1.SFSU.EDU>
*> Subject: The Bank of the Internet!?
*> 
*>   Yesterday I went to hear a very interesting talk by Eric Hughes, one of
*> the founding members of the Cypherpunk list/organization. Unlike most
*> encryption pop journalists, who seem to limit themselves to PGP, this
*> fellow brought up several boggling ideas:
*>   1) "Cryptography is all economics."
*>      In other words, all encryption schemes come down to: how much $ am I
*> willing to spend to keep you from getting into my secret info, and how
*> much $ are you willing to spend to get it?"
*>   2) There are two methods to keeping secrets on the NET (or IRL): trust
*> some one, or trust an algorithm. And, in general, human trust is cheaper
*> than technology.
*>   3) The US government classifies encryption schemes as munitions, and is
*> accordingly places all encryption technology under export restrictions
*> controlled by the state department.
*>   4) Claude Shannon's two basic principles of encryption: confusion and
*> diffusion.
*> 
*>   He also mentioned something called a "blind signature" -- a special form
*> of digital signature that keeps users unknown (through encryption) to both
*> the bank they deposit with and sellers they transact with. I didn't
*> understand this "blind digital signature" idea. Can anyone out here explain?
*> 
*>   But the real boggler is that this fellow Eric is, with the backing of
*> the Electronic Frontier Foundation, going to start a Credit Union based on
*> up-to-date encryption schemes and using the Internet as the monetary
*> highway! It involves using something called digital money -- a system of
*> encrypted data that expires over time, but that a highly flexible ability
*> to purchase quantities or services. The data itself will be located
*> over several nodes, so that no one site has all the info about your
*> account, but that any "quorum number" of bank nodes can reconstruct the
*> whole picture of your assets. Anyone trying to crack the system would
*> have to crack, not just one or two nodes, but a quorum number. Such nodes
*> will be distributed internationally, though favoring nations with
*> encryption-favorable legislation.
*>             **************************************
*>   I'm oversimplifying all this. But the whole notion of a Bank of the
*> Internet, backed by the EFF and running encrypted international monetary
*> transactions seems... well, this is Future Culture: what do you think?
*>