On Thu, Apr 11, 2002 at 10:29:39AM -0700, Tim May wrote:
> On Thursday, April 11, 2002, at 06:37 AM, Adam Back wrote:
> > - deployment / chicken and egg problem (merchants want lots of users
> > before they're interested users want wide merchant acceptance before
> > their interested)
>
> As I have said, some people make efforts to open offshore bank accounts,
> for income tax evasion, money laundering, purchase of illegal items,
> etc. The crackdown on offshore-backed VISAs and Mastercards is in the
> news. This provides some clue as to how much effort people will make to
> avoid certain kinds of traceability...and the efforts against banks and
> clearinghouses to stop these bypasses.
This is all evidence that there is lots of demand for anonymous
payment systems, the problems are in deployment and interfacing to the
existing payment systems for in and out exchange to make it
sufficiently convenient. (An convenient exchange in and out could
bypass the lack of merchant acceptance -- your payment to a merchant
accepting only credit cards would be just a conversion to a one-use
credit card number funded for the purpose of the transaction with
anonymous ecash.)
> [...]
> Other illegal uses which could motivate use of digital cash are: online
> gambling/numbers games, buying and selling of corporate insider
> information, tax evasion (eventually), etc.
>
> Redemption issues are not easy to arrange. Any bank which acts to issue
> and redeem/convert such tokens, when the main market is for trading
> child porn or other illegal warez, will likely be shut down by
> international bodies.
>
> A tough nut to crack. But at least we should be thinking about the
> customer-driven uses, not trying to get convince Joe Sixpack that he
> really should be using digital cash online, especially when just last
> week he was happy to give his SS number for the online drawing for a
> free CD.
Well online porn industry would surely be a killer app, natural desire
for privacy, higher than normal skepticism about giving credit cards
to merchants. I'm not aware of any attempts to capitalize on this
market. If I recall even there were claims that MTB tried to
discourage this kind of application by closing selected merchant
accounts.
Online gambling might be another plausible application.
> > Also the in-out exchange is less convenient. Perhaps with paypal now
> > having wider acceptance people would trade this kind of digicash
> > beta-bucks like scheme for real money paying with paypal with bidding
> > on ebay as for the everquest internal currency.
> >
> > That might be an interesting experiment. Or better yet for everquest
> > or other popular VR gaming thing to replace their currency by digicash
> > currency server, privacy for VR characters and their real-life
> > players.
>
> Game use is an interesting one, as we've talked about over the years.
> First, it may ostensibly seem "innocuous." Second, it both simulates and
> educates. Third, there is the potential for a "redemption leakage,"
> e.g., where the artificial money of the artificial system is bought and
> sold by players (seen in Everquest recently, seen a decade ago with an
> Extropians reputation-rating system).
Well actually to elaborate what I meant is we now (as opposed to 5 or
more years ago) have a large scale new payment related component to
play with which has interesting properties for ecash.
I was suggesting that the ecash mint operator exchange ecash directly
for Everquest currency (virtual "platinum pieces"). The Everquest VR
is a place in cyberspace, and there are people who make their living
by trading and selling virtual artifacts acquired in the game. The VR
world is of quite spectacular scale. To give a few factoids about the
scale virtual worlds from some recent articles I read "Norrath's per
capita income is roughly between Russia and Bulgaria. Or put another
way, Norrath is the 77th richest country in the world."
"Revenues from online gaming were already $208m in 2000 and some
estimates see that figure rising to $1.7bn by 2004. Sony's monthly
revenue from EverQuest alone is estimated to be $3.6m. In the far
east, virtual worlds earn more than that. The most successful online
role-playing game in the world is South Korea's Lineage, which has 2.5
million subscribers and is played in one of every eight households."
(both from:
http://www.guardian.co.uk/internetnews/story/0,7369,670971,00.html
).
So there is already a fairly liquid market in virtual platinum pieces,
despite Sony's complaints and attempts to stop this. Given the
expected growth and richness of VRs, it becomes more plausible that
online gambling and online porn itself could take place in these
virtual worlds with their ready made currency systems which have
already overcome the chicken-and-egg problems to some extent.
If they grew large enough their acceptance, or an ecash system backed
in them, might spill over into the real world and allow purchase of
services on the web, or even physical goods.
> More generally, I'm a fan of building simulated systems which have more
> "moving parts" than just the "here's a digital cash" protocol...enjoy!"
> approach. Pieces in isolation are like giving someone a piece of a
> complicated machine and telling him to make use of it.
Yes. Magic Money suffered that problem. My thoughs were that
Everquest et al may allow one to leap-frog the boot-strapping problem.
Adam
--
http://www.cypherspace.org/adam/
