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The following archive was created by hippie-mail 7.98617-22 on Fri Aug 21 1998 - 17:19:11 ADT
Robert Hettinga (rah@shipwright.com)
Sun, 28 Jun 1998 16:41:11 -0400
So, again, is Wired tired on this, or has Simon's cash protocol as already
presented a few years ago at Crypto/Eurocrypt/MIT/wherever as untraceable
as Chaumian blinding would be?
Has any cryptographer on these lists gone and looked at the patent to see
if it represents anything more than what Dan Simon presented a few years
ago?
By the way, I still claim that it isn't the fault of the protocol that
DigiCash is failing with ecash, it's the market model they're using. They
don't realize that, while privacy creates the technology, it's the cost of
the transaction which will *sell* the technology, and, properly done,
digital bearer certificates, the more anonymous the better, have a
significant cost advantage over even electronic book-entry settlement.
By thinking about privacy instead of economics, they have set up a
situation where they don't have enough licensed players in the market. They
don't properly bifurcate the trust relationship between underwriters and
trustees for starters, and they apparently have followed a cartelized,
one-bank-per-country strategy, which is a disaster in a ubiquitously
networked world operating under Moore's and Metcalfe's laws.
I have a small white paper out now with a (mostly) formal outline of this
market model for underwriting digital bearer transactions, which I've been
advocating for several years on these lists and elsewhere. Most people here
already know what it says, :-), but if anyone wants a copy of it, ping me
and I'll send it to them directly.
People on dbs@philodox.com have seen it already, of course. ;-).
Cheers,
Bob Hettinga
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Subject: IP: ISPI Clips 1.92: MS's Anonymous E-cash Could be Boon for
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ISPI Clips 1.92: MS's Anonymous E-cash Could be Boon for Financial Privacy
News from the Institute for the Study of Privacy Issues (ISPI)
Sunday June 28, 1998
ISPI4Privacy@ama-gi.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
This From: WIRED News, June 26, 1998
http://www.wired.com
"MS Patents Anonymous Ecash"
http://www.wired.com/news/news/technology/story/13277.html
by
Chris Oakes
chriso@wired.com
Update:
Microsoft has been awarded a patent on technology that allows electronic
cash transactions to remain anonymous.
The patent, issued on 15 June, was given to the Redmond, Washington, giant
for a system of creating "untraceable electronic cash," a technology that
lets consumers spend digital money without banks being aware of specifics,
including user identity.
Microsoft had no comment on the technology Thursday, and experts were still
analyzing the patent in an effort to understand its workings.
Despite the lack of details, the development raised speculation about
Microsoft's plans for electronic-payment technology and whether the patent
could be an effort to stymie the proliferation of anonymous cash.
Some people think that "Microsoft has patented it so that it will never see
the light of day," said Phillip Hallam-Baker, a security and electronic
transaction consultant. "But I don't think that's accurate.... You don't
create a system by sitting on a patent."
Such a patent is typical when a company is serious about developing an
idea, Hallam-Baker said, adding, "I wouldn't read into it that this
represents a policy direction."
Security expert Bruce Schneier said he didn't think the move amounted to
much more than a patent on research the company has been conducting for a
long time. (The patent application was filed in 1995.)
"I don't believe this means they're going to be doing [anonymous
micropayment technology]," Schneier said. "This is not a blocking patent,
this is not an overarching patent. I'm not scared."
No patents in the area of anonymous micropayment are fundamental enough to
make all businesses dependent upon one company's technology. At the
forefront of this sort of electronic cash, Schneier said, is DigiCash
http://www.digicash.com/ ), a company led by digital money pioneer David
Chaum. "This is something that Chaum pioneered and still hasn't really been
able to profit from."
With standard micropayment technology, a bank issues validated "coins" to
customers. Much like a cashier's check, the validation stamp indicates an
amount and the bank's signature on the coin. But since the bank knows each
coin it issues and to whom it was issued, the person's use of the coin can
be tracked.
DigiCash's eCash works around the problem by letting the bank stamp a coin
without tying it to a particular user. In this system, the customer's
computer creates a coin and sends it to the bank in a digital "envelope" to
hide its identity. The bank stamps it "blindly" through the envelope. The
coins are unrecognizable to the bank, and it doesn't know from which
account the coins came.
The CyberCoin payment system of CyberCash ( http://www.cybercash.com/ ), by
contrast offers no such anonymity. Any payment can be reconciled to the
user.
But Zona Research ( http://www.zona.com/ ) analyst Vernon Keenan says
DigiCash has not been very successful in finding customers for its system,
suggesting the short-term outlook is bleak not only for anonymous digital
cash, but digital cash in general. "The idea of micropayments has not been
successful on PCs, because you need to install a wallet and other support
mechanisms on PCs," Keenan said.
A wallet is a piece of software kept on a user's hard disk that stores the
documents associated with electronic payments, such as credit card
information, the tokens of electronic cash systems such as DigiCash, and
security certificates.
The only way any of these systems will be successful, Keenan said, is if
wallets are built into a browser or operating system. This has come to pass
with the release of Windows 98, he said, but it will be years before a
critical mass of users has installed and started to use the wallet
technology of that operating system.
Keenan was among those who didn't see great significance in Microsoft's
patent. "If [Microsoft] is going to make a business out of it, great. It
would be nice to see untraceable ecash," said Schneier. "But I'm not sure
there's a valid business model."
The anonymity is important to many anticipating ecash, but the extra
infrastructure it may require has to be underwritten by somebody. The only
people interested enough would be consumers.
"What are people willing to pay for anonymous electronic transactions? The
answer is not very much. As a privacy advocate, I'm sort of disheartened by
that. But life is life," said Schneier.
Consultant Hallam-Baker said, "All this is really saying is that Microsoft
has committed to investing resources into investigating an area of
electronic payment."
© 1993-98 Wired Ventures Inc.
-----------------------
NOTICE:
In compliance with Title 17 U.S.C. section 107, this material is
distributed free without profit or payment for non-profit research
and educational purposes only. For more information go to:
http://www.law.cornell.edu/uscode/17/107.shtml
-----------------------
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
INSTITUTE for the STUDY of PRIVACY ISSUES (ISPI)
ISPI Clips is a FREE e-mail service from the "Institute for the Study of
Privacy Issues" (ISPI).
The Institute for the Study of Privacy Issues (ISPI) is a small
subscriber-funded organization based in Victoria, British Columbia
(Canada). Its mandate is to research any issue regarding electronic,
personal and financial privacy. ISPI operates on a not-for-profit basis
and accepts no government funding. ISPI takes an international perspective.
ISPI's bi-monthly publication is "The ISPI Privacy Reporter"...a 12 page
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to all privacy issues including: personal privacy, electronic and Internet
privacy and financial privacy through asset protection and offshore
investment planning.
For more information about ISPI and how to order a subscription to
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--- end forwarded text
-----------------
Robert A. Hettinga <mailto: rah@philodox.com>
Philodox Financial Technology Evangelism <http://www.philodox.com/>
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 Philodox Symposium on Digital Bearer Transaction Settlement
July 23-24, 1998: <http://www.philodox.com/symposiuminfo.html>
The following archive was created by hippie-mail 7.98617-22 on Fri Aug 21 1998 - 17:19:11 ADT