From: brookfld@netcom.com (Brookfield Economics Institute (U.S.A.) Limited)
Date: Sun, 29 May 94 11:09:16 PDT
To: cypherpunks@toad.com
Subject: digital clearinghouse idea
Message-ID: <199405291809.LAA24209@netcom.netcom.com>
MIME-Version: 1.0
Content-Type: text/plain


I am a crypto-novice, so perhaps you can develop these ideas better. But, 
here goes.

Right now, if you want an anonymous transaction done and a small amount of 
money is involved, you
can go down to a bank or Seven Eleven and purchase a money order for cash. 
You mail the money
order, and it is very hard for anyone to find out who you are. The money 
order has introduced
anonymity between you and the payee. My concept is similar, but it would 
seem that any such concept
must work with your existing checking accounts, to be useful today.

So, to establish an ecash digital clearinghouse, how about the following:

1. Set up an Ecash Clearinghouse (ECH) in bank secrecy haven, such as 
Bahamas, Liechtenstein, etc.
2. Subscribers to ECH pay $2/month plus small transaction charge (say 
$.15/transaction)
3. Each subscriber authorizes his bank to accept electronic checks from ECH 
as debits to his account.
   Electronic checks are currently handled by the U.S. banking system as 
Automatic Clearinghouse
   transactions, and are used by organizations such as Checkfree(tm) and by 
insurance companies
   to automatically take money out of your account each month for premiums, etc.
3. Ecash is emailed to ECH.
4. ECH issues an electronic debit to payor's account. This debit clears, so 
now the money is in the
   account of the ECH.
5. ECH issues an electronic payment to the payee's account. This electronic 
payment is from the ECH,
   with the ecash number as the "backup" for the transaction.
6. Now everyone has gotten paid.

Weaknesses perhaps you can address: the ECH "knows" who is the payor and 
payee for each transaction.
Similar to anon.penet.fi, in that there _is_ a list somewhere which could be 
seized and use
to reconstruct the transactions, e. g. for "law enforcement" purposes.

Perhaps ECH subscribers could open an ECH account as a "numbered" account, 
but even so, since the
ECH would have each subscribers' regular checking account number, this 
wouldn't be much
protection. Without the ECH knowing your checking account number, ecash 
isn't convenient.

Any ideas?
BROOKFIELD ECONOMICS INSTITUTE
		(U.S.A.) Limited
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