From: Robert Hettinga <rah@shipwright.com>
Date: Fri, 19 Dec 1997 08:16:04 +0800
To: "William H. Geiger III" <schear@lvdi.net>
Subject: Lions and Tigers and Micromoney, Oh, My...
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At 4:21 pm -0500 on 12/18/97, William H. Geiger III wrote:


> Well IMNSHO hashcahs mail sucks!! It opens up the pandora's box of usage
> based charges for everything done on the 'net. What will be next? FTP
> sites charging hashcash for DL's? WebPages charging hashcash per hit? DNS
> servers charging per lookup? Routers charging per packet?

Yup, and you'll like it too. Especially if it efficiently prices
net.resources so well that the cost of "administering" and "controlling"
them disappears, well past the last basis point compared to our current
network resource "allocation" scheme, with time-based fixed pricing,
"peering" agreements, etc. ...

For details of the foundations of this, cf Kevin Kelly's "Out of Control",
or any e$ rant I've written in the past few years. Remember my joke about a
router which saves enough out of operations to buy a copy of itself?
Micromoney mitochondria, picomoney processor food, and so forth... Look,
Ma, no (human) hands...


> Note: In Adams proposal for hashcash only charges the user CPU cycles. The
> incentive for wide implementation of hashcash is going to be a real ecash
> based system where the implementors can make $$$ off it.

Yup. Money's fungible, and all that. In collision algorithms like hashcash
and MicroMint, you're effectively using computation time as copy protection
on unique digital objects, but *only* for that, like you're only using the
cost of intaglio printing to create unique paper bearer certificates,
dollar bills being a good example. You still have to add *value* to those
unique objects, and for that you need a market to set a price. (Sorry, Adam)

The parallels are even greater for things like hashcash, or at least
MicroMint. Like real coins in meatspace, the first collision-coin's
expensive to "mint", but the rest are vanishingly cheap. However, you *do*
want to make them to be worth something besides cycle time. That's because
the cost of anything is the foregone alternative, and all that. If you
don't attach fair value to unique useful items, someone else will and start
arbitraging them anyway. Ticket scalpers are a classic case of this. Might
as well get into the business explicitly instead of creating it for someone
else, I figure.

Anyway, all this fun with money requires, horrors, an actual financial
intermediary. Yet another private currency, in other words. Probably whole
bunches of them, I bet, all competing to fill each available market niche.
CryptoAnarchy, MarketEarth, Geodesic Economy, whatever...

> I have *PAID IN FULL* for my Inet usage!! What bits I send over the Inet,
> how many bits I send, and who I send them to is NO ONE's BUSINESS but my
> own!!! -- Last Anarchist of the Inet.

Sounds more like an industrio-socialist, to me. :-). Naw... Just pulling
your leg. Put your Glock away...

Seriously, I can't imagine fixed prices for *anything* once we have
instantaneously settled cash auction markets for anything you can send down
a wire. Fixed pricing is an artifact of long production runs,
hierarchically organized "economies of scale", and all that. Moore's "Law"
creates diseconomies of scale, particularly for information goods and
services on a public network. Nodes become cheaper compared to lines, which
gives you geodesic networks instead of hierarchical ones, all that stuff.
The, um, net, result is auction pricing and cash settlement. Not will you
pay in full, Mr. Geiger, but you'll pay cheaper, too. :-). Lots cheaper, I
bet...

If you could have cash-on-the-routerhead packet switching, it would behoove
each router to have as many connections as possible to sell it's services
down. You get a *more* geodesic network. That means lots of smaller routers
instead of Forbin-sized ones that we're trying to build now. Frankly,
super-routers are lost cause. No switch can monopolize the traffic, or
it'll choke and the network will route around it. That's the nice thing
about Moore's "Law" on the net.

Cheers,
Bob Hettinga

-----------------
Robert Hettinga (rah@shipwright.com), Philodox
e$, 44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
The e$ Home Page: http://www.shipwright.com/
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