A Cashless, High-Value, Anonymous Currency: How? 400
jfruh writes "The cashless future is one of those concepts that always seems to be just around the corner, but never quite gets here. There's been a lot of hype around Sweden going almost cashless, but most transactions there use easily traceable credit and debit cards. Bitcoin offers anonymity, but isn't backed by any government and has seen high-profile hacks and collapses in value. Could an experiment called MintChip brewing in Canada finally take us to cashless nirvana?"
Watts (Score:4, Interesting)
Re:Gold pressed Latinum. (Score:4, Interesting)
https://en.wikipedia.org/wiki/David_Chaum [wikipedia.org]
Re:Unifying online and offline payments (Score:5, Interesting)
Re:Gold (Score:5, Interesting)
GLD; but then you blow the anonymous feature. Of course gold is "cash" too, so I don't know what the GP means when he says it's "cashless". If he means, "not requiring government backing to have value", then yeah, sure; but AFAIK the definition of "cash" is tangible money whereas "cashless" to me implies money that is only a ledger entry in electronic form. The ledger entry may be associated with physical hardware; but the hardware itself is not the money, simply a means of proving that there is a unique ledger entry symbolizing money.
This whole topic is silly anyway. The summary implies that a cashless society is "nirvana" which in the west we synonmize with "paradise" or "heaven". For many, myself included, the vsion of cashless is "hell", which for our Hindu and Islamic friends I do not know how to translate. Dystopia. I think we can all understand that.
For me, heaven was when I was a kid and adults still paid for a lot of things with coins because they actually had some purchasing power. We could bring back this bit of heaven by simply striking new coins of the same composition with 10X the value. A "new penny" would carry a value of $0.10, a "new nickle" $0.50, etc. Pocket change would be worth something again, the zinc lobby would be OK with it (only reason we still have the penny is the zinc mining lobby), the vending machine people wouldn't have such a hard time accomodating this, and we would effectively and painlessly introduce dollar coins in the form of dimes instead of bulkier coins that people hate.
Of course there would be some resistance at first; but society ran just fine when a dime had a purchasing power equivalent of $2.00 today!
Stop demonizing bitcoin (Score:4, Interesting)
I'm not sure that's a bad thing anymore given what governments around the world are doing to people these days. I wish it was feasible to move all my money to bitcoin, honestly. Banks and governments can't freeze it at will.
This is misleading as all hell. Bitcoin itself has never been hacked. And pretty much every non-electronic currency collapsed in value in 2008. I'm not sure bitcoin did. It's new, but it's totally usable and stable enough.
Having used bitcoin personally for several things, I have nothing bad to say about it except that it's a little bit slow for transfers to happen. Still way faster than a bank and it operates 24/365.
Re:Gold (Score:5, Interesting)
World GDP is up to 60 trillion dollars BECAUSE the dollar is not backed by gold anymore. The money supply has been inflated, which devalues the currency.
Correct. Progress. Were not for fiat currency the US would have been bankrupted by the french and Swiss in the 70's demanding repayment for all outstanding debts in gold, china would still be horribly impoverished as rich countries hoarded gold and kept it away from the chinese etc. And we'd still have world GDP would be significantly smaller, everyone would have less wealth and less money flowing through their hands. This is perhaps the greatest success of ditching metal as a currency dramatically improving peoples lives. If it weren't for that the UK could theoretically still be buried with 200 or 300% of GDP in debt in gold that it could never pay back from WW2, leaving it a shell of a country.
Devaluing the currency removes the incentive to save, and forces people to 'invest'
Yep, that's probably the most profoundly useful thing about fiat currency. Gold sitting in a vault isn't flowing into the economy. Investing, even into boring government debt at least keeps the money moving around. Admittedly I probably should have clarified that I was talking about a crude approximation on the velocity factor in economic theory. It makes a huge difference. Sitting on money in a vault is pretty much the most useless thing you can do with it, and deprives everyone else of access to it, contracting the economy as a whole.
If gold was still used by everyone as money, politicians couldn't promise things they can't afford, and bankers couldn't endlessly inflate the money supply, forcing everyone to 'invest' with them.
Right. That's the situation Greece is in. They don't control the supply of euro's any more than they would control the supply of gold. They have 160 or so percent of GDP in debt, can't get investment (euro's or gold) so they need to devalue, which, when you have euro's and gold basically spirals the country deeper into debt that it can't pay off. If they could print more money, say an inflation target of 4% they would be devaluing greek labour relative to say germany, which would fairly quickly make greece a good investment opportunity for business (decreasing relative labour costs), a cheaper vacation spot as time goes on etc. And all that debt they had would start to chip away. They'd still be 10 years getting to 100% of GDP in debt, but as it is in 10 years greece is going to have 170 or 180% of GDP, if not more (unless they go bankrupt obviously) in debt, a population that's fleeing and they're going to face a complete economic disaster. In that sense the Euro and Gold are no different. Note that I'm explicitly not saying the US dollar is the same way, since the US has a federal system that doesn't cut health spending or pensions in florida just because there was a housing crash in florida. By that reasoning another option for the Euro is a more federal state where certain things (pensions, healthcare, justice, education, state ownership of pan euro corporations, such as the bank bailouts, would be trans Eurozone). But that's a whole other topic.
Re:Bitcoin hacked? Um no (Score:5, Interesting)
I actually tracked down who probably stole some bitcoins once. Yes it can be done, however, there are caveats, and they pretty much require the person to have been careless.
The problem is that the account numbers, unlike IPs, are not assigned. They are generated, by the client. A client may generate as many accounts as he likes. How do you track down a random number to the person who generated it?
Yes, you can see the transactions.... you can see both randomly generated numbers but... you don't know who is on each end. Then you have splits of value where the amount goes to two or more accounts (common as the default client generates a new address to send change back to, each time)
For example, when I did it, there was an address the stolen coins came from, and they were sent directly to another account, along with several others. For various reasons relating to how all this came about, I knew that the destination address was connected to an anonymous coin laundering service. No point chasing it forwards from there, as it would have been an unholy mess.... but I knew enough about how it worked to know that the inputs were going to all be the same person or group.... and there were multiple inputs to the address....
So a few quick websearches found that the owner had mixed his coins and one of the addresses was listed in some online posts. A bit more searching found that the person in question fancied himself a hacker. Talking to the person who lost the coins confirmed that the person I trakced down was known to him and considered a likely culprit already.
So can it be done? Yup it can... but its some work, and its often quite hard.