7 ms·

Of course, once these techniques were in place, they conclusively destroyed the ability of governments to control the flow of electronic funds, anywhere, anytim

by ctoth 11y ago

Of course, once these techniques were in place, they conclusively destroyed the ability of governments to control the flow of electronic funds, anywhere, anytime, for any purpose. As it happened, this process had pretty much destroyed any human control at all over the modern electronic economy. By the time people figured out that raging nonlinear anarchy was not exactly to the advantage of anyone concerned, the process was simply too far gone to stop. All workable standards of wealth had vaporized, digitized, and vanished into a nonstop hurricane of electronic thin air. Even physically tearing up the fiber optics couldn't stop it; governments that tried to just found that the whole encryption mess oozed swiftly into voice mail and even fax machines. ... Alex did not find it surprising that people like the Chinese Triads and the Corsican Black Hand were electronically minting their own cash. He simply accepted it: electronic, private cash, unbacked by any government, untraceable, completely anonymous, global in reach, lightninglike in speed, ubiquitous, fungible, and usually highly volatile. Of course, such funds didn't boldly say "Sicilian Mafia" right on the transaction screen; they usually had some stuffy official-sounding alias such as "Banco Ambrosiano ATM Euro-DigiLira," but the private currency speculators would usually have a pretty good guess as to the solvency of the issuers. - Heavy Weather

imglorp 11y ago
Paper cash is mostly untraceable, so we're not really changing that much. BTC is much more traceable.
- ctoth 11y ago
  Which is why I made this comment on a thread about a new digital currency that according to the title is untraceable, and not a thread about BTC.
- SuddsMcDuff 11y ago
  Don't rely on paper cash being around for that much longer either - http://www.zerohedge.com/news/2016-01-23/norways-biggest-bank-demands-cash-ban http://www.zerohedge.com/news/2016-01-23/norways-biggest-ban...
  - Symbiote 11y ago
    I moved to Denmark a few months ago, and have been asking a few people whether they'd prefer cash. Street food vendor: no, he preferred a card. Taxi driver: no, but he didn't want to take a card either, only a bank transfer from my phone. My account isn't set up for that yet, so he took the cash, then didn't have the 5kr change. Supermarket, exact change for a single item: I delayed people behind me, the machine used to count coins didn't accept mine. Café, for a single soft drink with exact change: I didn't ask, but the man dropped the exact change into the empty coin tray. So the result is I still have most of the coins which a foreign friend left behind after visiting in December.
- csomar 11y ago
  You can't compare Paper Cash to Bitcoin or Crypto-Currencies. You can't take $5million cash through Airport security. You can take $1bn bitcoin brainwallet through airport security, and nobody will ever notice.
paxcoder 11y ago
Tell me this Sterling guy got most other things wrong to even out being this spot on way back in 1994.
- ctoth 11y ago
  I was thinking to myself in the shower a few days ago, it must be incredibly boring to be Bruce Sterling. Where most of us can open HN and see something new and shiny and even sometimes unexpected, he saw it all clearly 20 years ago.
  - otoburb 11y ago
    On the contrary, how can he be bored if he's constantly roaming his imagination 20yrs ahead of where we are now, just as vividly as he was in 1994 writing about cryptocurrency, laptops made from straw, and reconfigurable chairs governed by topological expressions.
- pjc50 11y ago
  Bruce Sterling has a whole bunch of futurist notes you can read: http://www.viridiandesign.org/NotesIndex.htm http://www.viridiandesign.org/NotesIndex.htm - some of it is spot on, some of it was obvious even at the time to clued in people, and some of it is way out there still. Plus all his actual science fiction.
natrius 11y ago
It turns out that there's a pretty easy fix for this. People have to start caring how the money they're accepting has flowed through the economy. You don't need a government to sanction bad actors. The people can do it on their own. Money is power. Anonymous money prevents you from choosing which power you'd like to submit to. Decentralized money prevents governments from restricting power. Let's keep the decentralization and remove the anonymity so you can reject power you find undesirable. The first application of this mechanism will probably be restoring our democracies by rejecting the power of money to influence them. It won't be the last application—I think we'll use it to enforce any rule that has a broad consensus behind it. The boundaries of the enforcement will be the same as the boundaries of our economy: there aren't any. We'll have global governance without a global government. This is merit capitalism. http://meritcapitalism.com/ http://meritcapitalism.com/ Zcash is cool, but if you accept it as payment, you're making yourself powerless.
- onion2k 11y ago
  It turns out that there's a pretty easy fix for this. People have to start caring how the money they're accepting has flowed through the economy. Perhaps I'm being cynical, but that doesn't sound like an easy fix.
  - natrius 11y ago
    I appreciate the cynicism. I've never been called a pessimist, so I might have a rosy view of things. I think it's not that hard, though. Technologically, it's very straightforward. Convincing people that they should sacrifice financial privacy is the hard part. That's why I've already started it.
    - RangerScience 11y ago
      What's the thing you've made called, and how does it ensure identity?
- digbyloftus 11y ago
  It works both ways, anonymous money prevents people from choosing not to accept your own money as much as it does the other way around. It makes the transaction purely about the money, I don't think that's powerless, just reduces people's ability to mind other people's business.
jamoes 11y ago
> but the private currency speculators would usually have a pretty good guess as to the solvency of the issuers With bitcoin and other Nakamoto-consensus based crypto-currencies, the "solvency of the issuer" is irrelevant, because these currencies aren't debt based.
- joosters 11y ago
  It's not that clear-cut, perhaps the text is referring to the support of the currency, I.e. Some measure of how likely other people will accept the currency, and how secure is its base (will the miners decide to issue new coins and fleece everyone). Both would impact its reliability as a store of value.
- tbrownaw 11y ago
  Government-issued money being "debt based" is a fiction used to make the accounting equations look pretty. It has been since the gold/silver/whatever standard fell into disuse. Or are you talking about fractional-reserve banking? If so, there's nothing that prevents implementing that on top of crypto-currencies and more than it can't be implemented on top of physical currency.
  - mikekchar 11y ago
    Obviously there is nothing technically stopping it, but setting up the rules for a fully distributed fractional reserve system would be non-trivial. For example, if anyone can create money by lending it, then they can set up 100 wallets and lend money from one to the next to the next, amplifying their debt each time. Then once you have enough money, you spend it and abandon those wallets. The fractional reserve system works precisely because only a few well known actors are allowed to create money -- which is a bit of antithesis for this kind of crypto currency. However, I have to say that one of the things that bothered me (economically) about bitcoin is the lack of debt. This limits the availability of currency to either mining (which requires a large investment of hardware) or buying the currency on a market (which requires using a different currency and essentially relying on the same banking industry that you were trying to avoid). I would be very interested in seeing someone attempt some kind of monetary creation through debt in a cryto-currency.
herbig 11y ago
It's cute but it's speculative fiction that hasn't remotely come to pass. I don't get why anyone is saying this is spot on. People love good dystopian nonsense.
13thLetter 11y ago
Just like the rest of the cyberlibertarian blue-skying that went on back in the '90s, it was a nice dream, seriously! But in reality it turns out that governments can just send some armed men around to beat up the people with the encrypted faxes, email, and digital cash, and that'll largely put an end to it. The extent to which a government is helpless to stop that behavior is purely the extent to which it is reluctant to send, or incapable of sending, the armed men.
- haberman 11y ago
  See also: https://xkcd.com/538/ https://xkcd.com/538/
- wyager 11y ago
  Except for the fact that this hasn't happened at all. Even with Bitcoin, which isn't as anonymous as zcash claims to be, people making illicit purchases have had very little difficulty evading police or government capture. There are a few notable cases of high-profile Bitcoin users (like DPR) being arrested, but I don't know of any cases where Bitcoin was at fault.
  - Retric 11y ago
    There a lot of cases where Bitcoin transsctions are traced back to some crime. The justice system does not make a big deal about this as educating criminals only makes there job harder.
    - wyager 11y ago
      Evidence? In which cases was tracing Bitcoin transactions used?
      - msgilligan 11y ago
        I'm not sure how much (if any) of the investigation into the Carl Force and Shaun Bridges cases used Bitcoin transaction data, but I suspect it played some role: http://www.justice.gov/opa/pr/former-silk-road-task-force-agent-pleads-guilty-extortion-money-laundering-and-obstruction http://www.justice.gov/opa/pr/former-silk-road-task-force-ag...

by ctoth 11y ago

imglorp 11y ago

Paper cash is mostly untraceable, so we're not really changing that much. BTC is much more traceable.

ctoth 11y ago
Which is why I made this comment on a thread about a new digital currency that according to the title is untraceable, and not a thread about BTC.
SuddsMcDuff 11y ago
Don't rely on paper cash being around for that much longer either - http://www.zerohedge.com/news/2016-01-23/norways-biggest-bank-demands-cash-ban http://www.zerohedge.com/news/2016-01-23/norways-biggest-ban...
- Symbiote 11y ago
  I moved to Denmark a few months ago, and have been asking a few people whether they'd prefer cash. Street food vendor: no, he preferred a card. Taxi driver: no, but he didn't want to take a card either, only a bank transfer from my phone. My account isn't set up for that yet, so he took the cash, then didn't have the 5kr change. Supermarket, exact change for a single item: I delayed people behind me, the machine used to count coins didn't accept mine. Café, for a single soft drink with exact change: I didn't ask, but the man dropped the exact change into the empty coin tray. So the result is I still have most of the coins which a foreign friend left behind after visiting in December.
csomar 11y ago
You can't compare Paper Cash to Bitcoin or Crypto-Currencies. You can't take $5million cash through Airport security. You can take $1bn bitcoin brainwallet through airport security, and nobody will ever notice.

paxcoder 11y ago

Tell me this Sterling guy got most other things wrong to even out being this spot on way back in 1994.

ctoth 11y ago
I was thinking to myself in the shower a few days ago, it must be incredibly boring to be Bruce Sterling. Where most of us can open HN and see something new and shiny and even sometimes unexpected, he saw it all clearly 20 years ago.
- otoburb 11y ago
  On the contrary, how can he be bored if he's constantly roaming his imagination 20yrs ahead of where we are now, just as vividly as he was in 1994 writing about cryptocurrency, laptops made from straw, and reconfigurable chairs governed by topological expressions.
pjc50 11y ago
Bruce Sterling has a whole bunch of futurist notes you can read: http://www.viridiandesign.org/NotesIndex.htm http://www.viridiandesign.org/NotesIndex.htm - some of it is spot on, some of it was obvious even at the time to clued in people, and some of it is way out there still. Plus all his actual science fiction.

natrius 11y ago

It turns out that there's a pretty easy fix for this. People have to start caring how the money they're accepting has flowed through the economy. You don't need a government to sanction bad actors. The people can do it on their own. Money is power. Anonymous money prevents you from choosing which power you'd like to submit to. Decentralized money prevents governments from restricting power. Let's keep the decentralization and remove the anonymity so you can reject power you find undesirable. The first application of this mechanism will probably be restoring our democracies by rejecting the power of money to influence them. It won't be the last application—I think we'll use it to enforce any rule that has a broad consensus behind it. The boundaries of the enforcement will be the same as the boundaries of our economy: there aren't any. We'll have global governance without a global government. This is merit capitalism. http://meritcapitalism.com/ http://meritcapitalism.com/ Zcash is cool, but if you accept it as payment, you're making yourself powerless.

onion2k 11y ago
It turns out that there's a pretty easy fix for this. People have to start caring how the money they're accepting has flowed through the economy. Perhaps I'm being cynical, but that doesn't sound like an easy fix.
- natrius 11y ago
  I appreciate the cynicism. I've never been called a pessimist, so I might have a rosy view of things. I think it's not that hard, though. Technologically, it's very straightforward. Convincing people that they should sacrifice financial privacy is the hard part. That's why I've already started it.
  - RangerScience 11y ago
    What's the thing you've made called, and how does it ensure identity?
digbyloftus 11y ago
It works both ways, anonymous money prevents people from choosing not to accept your own money as much as it does the other way around. It makes the transaction purely about the money, I don't think that's powerless, just reduces people's ability to mind other people's business.

jamoes 11y ago

> but the private currency speculators would usually have a pretty good guess as to the solvency of the issuers With bitcoin and other Nakamoto-consensus based crypto-currencies, the "solvency of the issuer" is irrelevant, because these currencies aren't debt based.

joosters 11y ago
It's not that clear-cut, perhaps the text is referring to the support of the currency, I.e. Some measure of how likely other people will accept the currency, and how secure is its base (will the miners decide to issue new coins and fleece everyone). Both would impact its reliability as a store of value.
tbrownaw 11y ago
Government-issued money being "debt based" is a fiction used to make the accounting equations look pretty. It has been since the gold/silver/whatever standard fell into disuse. Or are you talking about fractional-reserve banking? If so, there's nothing that prevents implementing that on top of crypto-currencies and more than it can't be implemented on top of physical currency.
- mikekchar 11y ago
  Obviously there is nothing technically stopping it, but setting up the rules for a fully distributed fractional reserve system would be non-trivial. For example, if anyone can create money by lending it, then they can set up 100 wallets and lend money from one to the next to the next, amplifying their debt each time. Then once you have enough money, you spend it and abandon those wallets. The fractional reserve system works precisely because only a few well known actors are allowed to create money -- which is a bit of antithesis for this kind of crypto currency. However, I have to say that one of the things that bothered me (economically) about bitcoin is the lack of debt. This limits the availability of currency to either mining (which requires a large investment of hardware) or buying the currency on a market (which requires using a different currency and essentially relying on the same banking industry that you were trying to avoid). I would be very interested in seeing someone attempt some kind of monetary creation through debt in a cryto-currency.

herbig 11y ago

It's cute but it's speculative fiction that hasn't remotely come to pass. I don't get why anyone is saying this is spot on. People love good dystopian nonsense.

13thLetter 11y ago

Just like the rest of the cyberlibertarian blue-skying that went on back in the '90s, it was a nice dream, seriously! But in reality it turns out that governments can just send some armed men around to beat up the people with the encrypted faxes, email, and digital cash, and that'll largely put an end to it. The extent to which a government is helpless to stop that behavior is purely the extent to which it is reluctant to send, or incapable of sending, the armed men.

haberman 11y ago
See also: https://xkcd.com/538/ https://xkcd.com/538/
wyager 11y ago
Except for the fact that this hasn't happened at all. Even with Bitcoin, which isn't as anonymous as zcash claims to be, people making illicit purchases have had very little difficulty evading police or government capture. There are a few notable cases of high-profile Bitcoin users (like DPR) being arrested, but I don't know of any cases where Bitcoin was at fault.
- Retric 11y ago
  There a lot of cases where Bitcoin transsctions are traced back to some crime. The justice system does not make a big deal about this as educating criminals only makes there job harder.
  - wyager 11y ago
    Evidence? In which cases was tracing Bitcoin transactions used?
    - msgilligan 11y ago
      I'm not sure how much (if any) of the investigation into the Carl Force and Shaun Bridges cases used Bitcoin transaction data, but I suspect it played some role: http://www.justice.gov/opa/pr/former-silk-road-task-force-agent-pleads-guilty-extortion-money-laundering-and-obstruction http://www.justice.gov/opa/pr/former-silk-road-task-force-ag...