From: dlv@bwalk.dm.com (Dr.Dimitri Vulis KOTM)
Date: Thu, 31 Jul 1997 22:10:43 +0800
To: cypherpunks@toad.com
Subject: Re: uncensorable net based payment system?
In-Reply-To: <199707311307.IAA17412@mailhub.amaranth.com>
Message-ID: <cFkPae11w165w@bwalk.dm.com>
MIME-Version: 1.0
Content-Type: text/plain



"William H. Geiger III" <whgiii@amaranth.com> writes:

>
> -----BEGIN PGP SIGNED MESSAGE-----
>
> In <199707311240.NAA00742@server.test.net>, on 07/31/97
>    at 01:40 PM, Adam Back <aba@dcs.ex.ac.uk> said:
>
> >Then I can have some net cash savings backed by the rights to 1Tb of
> >bandwidth at 100 Mb/sec.  100 Mb/sec for 3 days.
>
> >A problem with this is that the market prices of the assets is
> >continually dropping.  How do I hedge against this.  Can I buy futures?
> >Sell 100 Mb/sec for 3 days now in exchange for 200 Mb/sec for 3 days in 1
> >years time at an predicted equivalent value?

This is a VERY interesting idea Adam.

But it should also depend on the time of day: 10mbps at 8 pm, when all
the geeks are jerking off online, is more valuable than 10mbps at 5 am.

Another observation is that a lot of folks have a lot of unused
bandwidth which they keep just in case they need it once a day.
If they can rent out the unused bandwidth, it'll make it cheaper
to buy even more bandwidth in case they need it later - a self-feeding
growth.  Cool.

> Well I see some problems with this. Any increase in bandwith requires the
> addition of hardware to accomplish it. It would be of little use to me to
> have 100 Mb/sec for 3days considering the cost of installing the lines and
> purchacing the extra equipment.
>
> Also in a packet switching environment how do you plan on insuring any
> amount of bandwith? The Backbone is not set-up for this. The only way in
> the current enviorment that you can guarantee a given bandwith is by
> having a dedicated connection point to point.

I had a very interesting conversation the other day about how electrical
utilities (and traders) are now developing fascinating derivatives based
on the electricity as a commodity.  Sure one can trade futures on electricity.
Electricity also comes in different kinds and at different prices depending on
the geographic location and the local time; noon electricity on the east
coast is not the same as the noon electricity in chicago. All this trading
leads not just to speculation, but to better hedging, more efficient
utilization of resources, and lower prices for end-users.

I'm shocked I myself didn't think then and there of an analogy with Internet
bandwidth.

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Dr.Dimitri Vulis KOTM
Brighton Beach Boardwalk BBS, Forest Hills, N.Y.: +1-718-261-2013, 14.4Kbps