61 ms·

> 1% of 1% (so .01%). Is refusing large bills an effective countermeasure? If so, then yeah — not really an issue. Our economy somehow grinds along just fine.

by darawk 7y ago

> 1% of 1% (so .01%). Is refusing large bills an effective countermeasure? If so, then yeah — not really an issue. Our economy somehow grinds along just fine. So refuse large Kong notes. Why would you assume the economy finds workarounds for cash but not this? > In what sense? The whole idea here is that I can exchange a physical note to transact with someone. Ya, and for most transactions you will. If you're suspicious, you can validate the physical devices using your phone. But for simple transactions with a moderate level of trust, you can accept cash. The same way you accept a $20 from a friend without buying a counterfeit detector pen to check it.

arcticbull 7y ago
> So refuse large Kong notes. Why would you assume the economy finds workarounds for cash but not this? That makes this, at best not better, and at worst, well, worse, because it introduces a myriad new failure modes.
jakelazaroff 7y ago
Why do you assume only large Kong notes will be easily falsified? The scenario I foresee is if printing notes becomes decentralized, a malicious printer makes any note likely to be duplicated. Re: finding workarounds, we’re talking about money — we shouldn’t be “testing in production”, so to speak. IMO the government should come down hard on this.
- darawk 7y ago
  > Why do you assume only large Kong notes will be easily falsified? I don't. I assume that, exactly like cash, only large notes will be worth falsifying.
  - arcticbull 7y ago
    The other thing to consider is the pragmatic aspect. A US bill costs an average of 10.3c to print [1]. A US $1 bill is 2.61 by 6.14 inches (16 square inches). I don't have bulk flex PCB costs on hand, but bulk FR4 rigid is $0.05c/sqin and flex is definitely more. That prices you at minimum $0.80 in PCB. An NFC antenna is a specialized piece of kit that adds cost, tuning, etc. A Dual-Interface NFC/EMV card costs $2. Adding all that flex means we're talking $3. Now your bills cost over 30X what a traditional bill costs. Since counterfeiting is only 0.01% of US bills, to stop that, you're proposing we pay a 30X premium on the manufacture of those bills? The treasury prints 38M notes per year, totaling $541M dollars. That's a material cost of $3.9M. If 0.01% of that $541M is counterfeit, that's an additional cost of just $54,000, bringing our total just under $4M. Even if you chose to include "2% inflation" as a cost (and to be clear, you shouldn't) that's still just $10.82M. To print the same 38M notes in Kong we'd be paying $106M. That means to eliminate $4M in printing and counterfeiting costs we'd have to pay $106M. You're proposing we pay 10-27X as much per year to manage our currency. [2] Not to mention the sheer electricity cost of creating and locking up the value on the Ethereum blockchain. Then, mechanical stress/strain and failure of the secure elements over time takes value out of both the Kong real-world supply and also out of Ethereum, which is already subject to massive breakage. This is basically why we don't verify signatures on checks. It's cheaper to eat the fraud cost. [1] https://www.investopedia.com/news/fed-will-print-more-50-bills-year/ https://www.investopedia.com/news/fed-will-print-more-50-bil... [2] https://www.factmonster.com/math/money/facts-about-us-money https://www.factmonster.com/math/money/facts-about-us-money

by darawk 7y ago

arcticbull 7y ago

> So refuse large Kong notes. Why would you assume the economy finds workarounds for cash but not this? That makes this, at best not better, and at worst, well, worse, because it introduces a myriad new failure modes.

jakelazaroff 7y ago

Why do you assume only large Kong notes will be easily falsified? The scenario I foresee is if printing notes becomes decentralized, a malicious printer makes any note likely to be duplicated. Re: finding workarounds, we’re talking about money — we shouldn’t be “testing in production”, so to speak. IMO the government should come down hard on this.

darawk 7y ago
> Why do you assume only large Kong notes will be easily falsified? I don't. I assume that, exactly like cash, only large notes will be worth falsifying.
- arcticbull 7y ago
  The other thing to consider is the pragmatic aspect. A US bill costs an average of 10.3c to print [1]. A US $1 bill is 2.61 by 6.14 inches (16 square inches). I don't have bulk flex PCB costs on hand, but bulk FR4 rigid is $0.05c/sqin and flex is definitely more. That prices you at minimum $0.80 in PCB. An NFC antenna is a specialized piece of kit that adds cost, tuning, etc. A Dual-Interface NFC/EMV card costs $2. Adding all that flex means we're talking $3. Now your bills cost over 30X what a traditional bill costs. Since counterfeiting is only 0.01% of US bills, to stop that, you're proposing we pay a 30X premium on the manufacture of those bills? The treasury prints 38M notes per year, totaling $541M dollars. That's a material cost of $3.9M. If 0.01% of that $541M is counterfeit, that's an additional cost of just $54,000, bringing our total just under $4M. Even if you chose to include "2% inflation" as a cost (and to be clear, you shouldn't) that's still just $10.82M. To print the same 38M notes in Kong we'd be paying $106M. That means to eliminate $4M in printing and counterfeiting costs we'd have to pay $106M. You're proposing we pay 10-27X as much per year to manage our currency. [2] Not to mention the sheer electricity cost of creating and locking up the value on the Ethereum blockchain. Then, mechanical stress/strain and failure of the secure elements over time takes value out of both the Kong real-world supply and also out of Ethereum, which is already subject to massive breakage. This is basically why we don't verify signatures on checks. It's cheaper to eat the fraud cost. [1] https://www.investopedia.com/news/fed-will-print-more-50-bills-year/ https://www.investopedia.com/news/fed-will-print-more-50-bil... [2] https://www.factmonster.com/math/money/facts-about-us-money https://www.factmonster.com/math/money/facts-about-us-money