"Nobody cares if it can't be used for offline transactions if it can be used to circumvent the gambling regulations." In other words, the future of Bitcoin is

"Nobody cares if it can't be used for offline transactions if it can be used to circumvent the gambling regulations." In other words, the future of Bitcoin is in the black market. Which means that the police are just going to look for people who are engaged in Bitcoin transactions, and particularly those engaging in large volume transactions, and they will just happen to be patrolling in that person's neighborhood. "Are these other systems used anywhere?" The timing was bad; David Chaum tried to create a company that facilitated digital cash in the 90s, but faced so much trouble and so much resistance by the US government (which at the time was actively thwarting cryptography deployment on the Internet) that his company ultimately went bankrupt. There is nothing stopping a digital cash revival if you want to start it up again -- smartphones could add something interesting to that mix, like phone-to-phone payments (and unlike Bitcoin, you could do this in a way that does not require either phone to have Internet service -- so people could transfer money in New York City's subways, for example).