From: Clay Olbon II <clay.olbon@dynetics.com>
Date: Mon, 11 Nov 1996 05:49:42 -0800 (PST)
To: Rabid Wombat <cypherpunks@toad.com
Subject: Re: Pyramid schemes and cryptoanarchy
Message-ID: <1.5.4.32.19961111134757.00a03df0@ix.netcom.com>
MIME-Version: 1.0
Content-Type: text/plain


At 04:39 PM 11/10/96 -0500, Rabid Wombat wrote:
>On Sun, 10 Nov 1996, Clay Olbon II wrote:
>
>> Pyramid schemes could be a growth market in a crypto-anarchic world.  It is
>> yet another market such as gambling, or the lottery, that could be conducted
>> with anonymity.  And it appears to be much more widespread on the internet
>
>How is it like gambling? If I get a pyramid letter instructing me to send 
>money to five people on the list, add my name to the bottom, send to 5 
>people, or whatever, there's nothing stopping me from removing all the 
>names, adding my name and those of four friends, and passing the letter 
>along. With an anonymous system, I could easily be all five people, 
>without even the bother of getting five different post office boxes.

I was not saying that chain letters are like gambling.  My point was that
they could be conducted with anonymity - like gambling and the lottery.
Your other point is well made.  Anyone have ideas on a protocol to prevent
this problem?

>
>There's no gambling involved; only blantant stupidity.

Agreed.  Although I think gambling and the lottery are pretty stupid as well
("The lottery is a tax on people who are bad a math" - from a friend's .sig).

>The "airplane" game was an interesting slant, though. Because of the 
>in-person "airplane" parties, people were able to make contacts and 
>network while participating. It was still the same old trick, but some 
>may have found the ability to "buy" (and "sell") face time worth the price 
>of admission (Some of the "airplane" games going around were to the tune 
>of $2500, rather than the usual $5). Your anonymous slant on 
>this removes the only economically viable excuse for participating, 
>though - I don't even get to meet the head of the umptysquat dept. in 
>return for getting fleeced.
>
>The "airplane game" was big around Washington about a year ago, and
>involved a number of highly placed people who aught to have been able to 
>recognize a Ponzi scheme when it bit them in the ass. Makes me wonder how 
>many people are stupid enough to "play" these games. 

I'm not familiar with the airplane game.  Sounds like a DNC fundraiser to me
;-) And yes, I think there are a lot of stupid people out there (ex. I
started a new job recently and noticed that a warning about the "Good Times
Virus" was posted on the bulletin board).  I'm not sure that the game would
even have to be close to fair for plenty of people to participate -
especially if it involves digital cash and email, which may be much easier
than snail-mailing letters. 

        Clay
*******************************************************
Clay Olbon			clay.olbon@dynetics.com
engineer, programmer, statistitian, etc.
Dynetics, Inc.
**********************************************tanstaafl