From: Robert Hettinga <rah@shipwright.com>
Date: Tue, 29 Apr 1997 12:36:14 -0700 (PDT)
To: cypherpunks@toad.com
Subject: Re: Bypassing the Digicash Patents
In-Reply-To: <v03020919af8b9e12df33@[139.167.130.246]>
Message-ID: <v0302093eaf8be0697540@[139.167.130.246]>
MIME-Version: 1.0
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At 1:54 pm -0400 on 4/29/97, Tim May wrote:


> At 6:19 AM -0800 4/29/97, Robert Hettinga wrote:
>
> >And, if Digicash keeps finding a "greater fool" when the money runs out,
> >we'll end up waiting until 2007, the expiration date on the blind signature
> >patent, in order for anything to happen at all.
>
>
> Recall that there are at least two major bypasses of the blind signature
> patent: the Doug Barnes "identity agnostic" approach and the Ian Goldberg
> work on moneychangers and "everyone a mint."

I certainly wasn't ignoring these guys. I suppose if you're going to be
issuing certificates in, holding the money in trust for, or even writing
commercial software for some kind of digital bearer certificate market, it
would probably be a good idea not to fight off lawsuits all the time from
the acknowleged patent holder, whether or not they're justified.

Of course there's the counterexample in aviation of Curtiss, who fought off
the Wright brothers for years to great effect, after fairly outright patent
theft.

> I happen to agree that Chaum is the pioneer of much that we consider core
> Cypherpunks technology. And I wish him well and hope he someday recoups his
> investments in Digicash and ends up making money. But I agree with Bob's
> points about the mistakes Digicash has made...and this is not some opinion
> I have come to in hindsight: I, and others, expressed these views several
> years ago.

I really didn't understand this myself until maybe two years ago, when I
applied the physical bearer certificate model to a hypothetical market for
digital bearer certificates. The whole problem crystallizes when you look
at it that way. In that context, Digicash is more like the Crane paper
company, or better, the folks who invent the doodlers and stuff to make
very complex intaglio printing possible, not even the press manufacturer.
Certainly very necessary technology, in fact the defining technology, but
not quite sufficient by itself to create a market. ;-).

> (One such expression was in an article I did a few years ago about how
> software patents are instrinsically poorly "metered."
<snip>
> The situation is
> vastly different with software patents, and this is holding back such
> innovations. I have no real solution, except to simply advocate
> "liberation" of such things...if it can't be protected without an intrusive
> police state, screw the supposed property rights. Schelling points, David
> Post's "code," and all that...sorry for the elliptic (not curve)
> references.)

Oddly enough, it's quite possible to have perfectly pseudonymous digital
bearer certificate markets where the protocol inventor is fairly
compensated for inventing the protocol. The key is to use the trustee as
the policeman of the market, the place where the meter "clicks". Since the
exchange of certificates into other kinds of money (be it other
certificates, book-entries, or commodities of some kind) must go through
the trustee at some point, the trustee can, as part of the trust agreement
with the holders of the certificates, give some share of transaction fee or
interest income to the protocol designer, in addition to what is paid to
the underwriter. The trustee is renting their reputation to the transaction
process anyway, so it is the best entity to increment the meter fairly on
the designer's behalf.

Look, Ma, no nation-state!

Cheers,
Bob Hettinga





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