From: cman@communities.com (Douglas Barnes)
Date: Sun, 8 Oct 95 08:44:04 PDT
To: aba@atlas.ex.ac.uk
Subject: Re: cypherpunks digicash bank?
Message-ID: <v02120d00ac9daa196797@[199.2.22.120]>
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Adam --

I'm afraid you may have somewhat misunderstood the motivation
behind the Identity Agnostic paper. In no way is it intended as
a way of not facing the music wrt regulators in the country(s) where
such an institution has offices. The IA approach is intended as
an possible alternative for an institution that might otherwise
license from Chaum.

The regulators I've discussed this with are primarily concerned
with how money moves into and out of a digital cash system. The
fact that small payments cannot be traced from buyer to seller is
not at the top of their list of concerns -- it's already a basic
fact of life for them in existing payment systems. They are also
not oblivious to the privacy concerns inherent in an institution
logging masssive amounts of counterparty data about small transactions.

I would strongly discourage anyone from trying to set up a garage-
type operation. While regulators clearly don't appreciate the
subtleties of this stuff, they can spot an illegal bank or an
unlicensed money transmitter from a mile away.

If your concern is creating account anonymity, then you're going
to need to set up outside of the US. Do be aware that even the more
relaxed countries of the world have regulations that cover this
sort of thing, and they are especially interested in making sure
you at least pay the appropriate licensing fees.