From: Ryan Lackey <ryan@netaxs.com>
Date: Fri, 12 Jan 1996 07:26:30 +0800
To: cypherpunks@toad.com
Subject: Re: E-cash and Interest
In-Reply-To: <199601111911.AA16628@mail.crl.com>
Message-ID: <199601112252.RAA03445@unix5.netaxs.com>
MIME-Version: 1.0
Content-Type: text


In one of many possible worlds, Frank O. Trotter, III did say:

> One note, under US banking regulation, "transaction accounts" fall
> under different rules than money market accounts, savings accounts,
> and NOW accounts.  Depending on the exact functionality desired, 
> and future regulation changes, there will be more or less incentive
> and/or legal ability to pay interest.

Yet more incentive for starting a bank somewhere in the free world...

> Given the current functionality of Ecash there will be little 
> incentive to hold balances on your hard drive once interest is
> available.  It is just too easy to move the money down when
> you need it.  Today there is no specific cost incentive between 
> the Mint and your hard drive.

Ecash really would be a lot nicer if it were implemented in a 
multi-issuer system with even more choices for storing your money, like 
in an ecash money market account at a non-issuing institution.  I can wait.

I agree that there's little point in storing ecash on your hard drive 
past a slush amount for purchases (hopefully the sw will be smart enough 
to advise people as to how much to keep on hand)...ecash still requires a 
check with the bank before spending any cash, correct?  Ecash on disk 
doesn't protect against denial-of-service-through-networking attacks 
then.  Keeping ecash at MTB, however, wouldn't be my reason for keeping 
it at a remote location.  Probably.

> It does not take a long leap to see that when the account and the
> Mint are merged, that since the Mint _is_ the account, PC/Internet 
> banking, debit and all other regular banking functionality can
> become immediately integrated!

If I had to conduct all of my banking in accordance with 
Mark Twain's fee schedule and legal restrictions, I'd be buying another 
mattress right now..well, maybe pillowcase.    

By integrating all of these services under Mark Twain Bank Ecash Mint, I 
would get all of the advantages of a rather pricey bank, 4-5% loss on all 
my deposits, minimal privacy protection, no FDIC protection, $2500 
initial deposit (not a problem for me, but it does keep many of the 
people I'd like to send money to out of the system..always a feature), 
and _tens_ of places to spend my ecash, only 4 or 5 of which that really 
sell things.

-- 
Ryan Lackey -*- ryan@pobox.com -*- http://www.netaxs.com/people/ryan/
"Calmly and impersonally, she, who would have hesitated to fire at an 
 animal, pulled the trigger and fired straight at the heart of a man 
 who had wanted to exist without the responsibility of consciousness."
                                       -- Ayn Rand, _Atlas Shrugged_.