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Surviving the Cashless Cataclysm

samzenpus posted about 2 years ago | from the life-on-a-card dept.

The Almighty Buck 463

MrSeb writes "There's been a lot of noise about Sweden becoming a cashless economy, and the potential repercussions that it might cause, most notably the (apparent) annihilation of privacy. Really, though, I think this is a load of hot air. Physical money might be on the way out, but that doesn't mean the end of anonymous, untraceable cash — it'll just become digital. If Bitcoin has taught us anything, it's possible to create an irreversible, cryptographic currency — but so far it has failed because it doesn't have sovereign backing. What if the US or UK (or any other country for that matter) issued digital cash? We would suddenly have an anonymous currency that can be kept on credit chips (or smartphones) and traded, just like paper money. No longer would handling money require expensive cash registers, safes, and secure collections; your smartphone could be your point of sale. It won't be easy to get governments to pass digital cash into law, though, not with big banks and megacorps lobbying for centralized, electronic, traceable currency. Here's hoping Sweden makes the right choice when the referendum to retire physical money finally rolls around."

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Wow (-1)

Anonymous Coward | about 2 years ago | (#39434549)

Fuck you Doubleplus good asshole

Bitcoin is a joke! (-1)

Anonymous Coward | about 2 years ago | (#39434557)

Give us a break about BitCoin and this non-sense that given the fact that it failed was to be blamed on not having sovereign backing. If it had no one would have used it as the only ones using it are criminals. Yes, criminals. Most are trying either to avoid paying taxes.

As far as the non-sense about "without money there would be no hold-ups in the streets and subways". No, there will be the same crime but worse. No rather than getting away with some $$, they will turn to killing the people in order to have time to wipe out their accounts.

Re:Bitcoin is a joke! (0)

Anonymous Coward | about 2 years ago | (#39434681)

Credit cards weren't accepted in the beginning. Of course, it has teething problems, but give it time, and I'm sure it would be as accepted as PayPal is today.

Re:Bitcoin is a joke! (3, Funny)

lgw (121541) | about 2 years ago | (#39435149)

Give us a break about BitCoin and this non-sense that given the fact that it failed was to be blamed on not having sovereign backing. If it had no one would have used it as the only ones using it are criminals. Yes, criminals. Most are trying either to avoid paying taxes.

Back in the 60s, there was also a lot of noise about "we need a currency the government can't destroy by printing endless amounts", because we had recently officially left the gold standard (we had unofficially left it under FDR when he outlawed private ownership of gold). Being the 60s, one often-discussed proposal was the use of hemp-backed currency. A note might be backed by 20 pounds of hemp (and be printed on hemp paper, of course). But that was mostly hippies discussing this, and so it went nowhere.

From what little I've read, to the extent BitCoins are in use, it's as an underground currency, mostly to buy illegal drugs (I'm a bit skeptical, but it could be so). So perhaps we've come full circle to a new hemp-backed currency? I kind of hope so, just for the humor value.

Re:Bitcoin is a joke! (0)

Anonymous Coward | more than 2 years ago | (#39435283)

While you may have glossed over this point for the purposes of the joke, I just wanted to point out that hemp actually isn't a drug. No THC in them leaves. You can smoke all you want, you're not going to get any higher than huffing on rose hips.

Secure = Traceable (3, Insightful)

JoeMerchant (803320) | about 2 years ago | (#39434561)

If it's secure, it's traceable, otherwise you can duplicate it.

Re:Secure = Traceable (4, Insightful)

amiga3D (567632) | about 2 years ago | (#39434601)

Imagine giving your neighborhood dealer $200 digital cash for some drugs then the cops catch him with your money, traceable to you, on his iphone. Not good.

Re:Secure = Traceable (5, Insightful)

Anonymous Coward | about 2 years ago | (#39434877)

Maybe its just me, but your logic of using an illegal situation to justify why a digital economy shouldn't exist seems like a bad argument.

Re:Secure = Traceable (5, Insightful)

shiftless (410350) | about 2 years ago | (#39435051)

Until you realize that tons are things of illegal that shouldn't be.

Re:Secure = Traceable (1)

yodleboy (982200) | more than 2 years ago | (#39435335)

I'm curious. Share some examples, besides drugs (because that's just not going to happen in the USA) of things that should be made legal.

Moving past artifcial scarcity (4, Insightful)

Paul Fernhout (109597) | about 2 years ago | (#39435099)

:-) We should think deeply about how to move past have artificial scarcity (including fiat currencies) at the heart of a 21st century abundance-oriented economy. We can do that in part by improving our gift economy (Linux, Wikipedia, Thingiverse, blogging), by improving our subsistence economy (home robotics, 3D printers, solar panels, maybe LENR), by improving our planning (like by using emails and twitters to organize the economy by creating and monitoring demand and feedback), and, if we do have a currency, by having a basic income to go with it, as well as LETS-like local currency systems. It would also help to rethink the nature of most "work" so it is more inherently fun and inherently meaningful:
http://www.whywork.org/rethinking/whywork/abolition.html [whywork.org]
http://web.archive.org/web/20110425153540/http://www.smallisbeautiful.org/buddhist_economics/english.html [archive.org]

As a rule of thumb, if there are laws relating to something about "counterfeiting" or "unauthorized sharing", you are dealing with a system based around "artificial scarcity". We should be able to do better in the 21st century.
http://www.youtube.com/results?search_query=star+trek+money [youtube.com]

Re:Moving past artifcial scarcity (0)

Narcocide (102829) | more than 2 years ago | (#39435213)

+5 way too smart for the room.

Re:Moving past artifcial scarcity (3, Insightful)

lgw (121541) | more than 2 years ago | (#39435289)

We should think deeply about how to move past have artificial scarcity

The economy will never be "post-scacity", as there's only so much shoreline property. There will always be desireable stuff that is scarce, and there will always be stuff that is desireable it's scarce - even if it's just the concert T-shirt that shows you listened to that band before it was cool.

including fiat currencies

In practice, the currency in use is simply the most-easily-exchanged commodity. Fiat currencies emerged because, as economies grew, you simply couldn't find enough notes to do business. BitCoins have a very interesting solution to this problem: they are quite limited in quantity, but you can exchange arbitrarily small fractions of one. That might actually work.

It has also been pointed out that a gold-backed currency could work in a modern economy with fractional-reserve lending, as the limited amount of gold (and therefore notes) wouldn't matter very much. I agree, but then what problem are you solving?

As a rule of thumb, if there are laws relating to something about "counterfeiting" or "unauthorized sharing", you are dealing with a system based around "artificial scarcity". We should be able to do better in the 21st century.

The American money supply is based on a zero-reserve banking system. Yup, except for demand accounts, banks can lnd out all that they take in. That means the money supply is theorectically infinite, and practically limited only by "friction" - the time it takes for money to circulate. US Dollars really aren't based around "artificial scarcity" any more. What could possibly go wrong?

Re:Secure = Traceable (1)

wierd_w (1375923) | about 2 years ago | (#39434905)

Preloaded disposable visa.

All this will do is create a thriving money laundering economy. People will buy and fill disposable visa cards, then give those out like cash.

and how are you going to buy one? (1)

decora (1710862) | about 2 years ago | (#39434935)

1. card creation center makes card
2. retailer stocks card on shelves
3. user picks card of shelf
4. user pays cashier
5. .... pays cashier with what? there is no cash anymore.
6. user pays cashier with electronic device, which is tracable
7. user takes 'cash card' and gives it to drug dealer
8. drug dealer passes it through 'laundering chain'
9. organized crime underground 'prepaid visa card' center collects cards and launders money
10. oops, its all tracable to the original retailer.

Re:and how are you going to buy one? (1)

Samantha Wright (1324923) | about 2 years ago | (#39435003)

Barter! Just buy something for the seller. And if barter's too clumsy, then, um... use little bits of paper with "IOU" written on them?

Actually, you're missing something. The user doesn't need to pay the cashier. The user could pay someone else to buy the card at a small premium. As long as there are enough purchasing brokers and enough users, the user would be anonymous.

Re:and how are you going to buy one? (3, Insightful)

Obfuscant (592200) | about 2 years ago | (#39435093)

The user could pay someone else to buy the card at a small premium.

So when the drug dealer's money is confiscated and traced back to someone, it will be someone who you paid to buy it for you, and since there is no physical money anymore, that person will be able to provide your info to the cops. Or he'll go to jail.

Care to debate which option your local prepaid VISA card reseller who doesn't want to go to jail and doesn't give a damn about you will pick?

It doesn't matter who you buy the card from, they'll have your information because you can't pay them untracably. Even if you could barter all the money you need with them, they'll have your info.

Re:and how are you going to buy one? (1)

wierd_w (1375923) | about 2 years ago | (#39435135)

This discounts international transactions, which was meant to be implied.

Eg, you make a nice little vacation trip to belize, use a bank to get local hard currency, buy an epic shitton of preloaded 200$ visa cards.

Upon return home, you sell them for "favors".

Re:and how are you going to buy one? (1)

Samantha Wright (1324923) | more than 2 years ago | (#39435209)

It would require a professional code of conduct to protect clients' anonymity, but it's not inconceivable. If enough people are concerned about privacy, there may very well be, realistically, too many clients for a given broker to remember. Also, a lot of obfuscation can be accomplished through gifting people indirectly: if broker A gives out $150 to 10 people and broker B gives out $100 to 8 people, then the customers of broker A can repay broker B, and vice versa, and then B can pay A $50 to balance things out. If the client is caught with money from broker A, then his dealer could have been any one of broker B's payers.

Re:and how are you going to buy one? (1)

geekoid (135745) | about 2 years ago | (#39435107)

I would just say it was stolen. If they are laundering it, then it won't matter.

OTOH, removing the convient way to get something illegal might start motivating people to change the law.

Re:and how are you going to buy one? (1)

wierd_w (1375923) | more than 2 years ago | (#39435263)

If the cards change hands frequently enough, then the tracability of the card becomes as difficult as the tracability of the unique IDs on cash bills.

Rather than swipe the card, the loaded card is traded itself, wholesale. The "20$ card" is treated as a $20 bill would be. You don't rush to the bank every time you get a 20 in change. You pass that 20 to somebody else for a good or service.

Same thing here. The various denominations of card would never go through a card swipe machine, except to permanently denude it of its assets prior to its physical destruction. That 200$ card can have changed hands physically hundreds of times before then. This is the same problem as cash bills.

A launderer would accept old cards, swipe them, and then reissue new ones while on vacation under an alias.

This happens enough times, you will play hell catching the original minter.

Re:Secure = Traceable (0)

Anonymous Coward | more than 2 years ago | (#39435181)

Yeah, imagine if cops could actually directly find criminals rather than fuck around for years with a drug on war that never ends. Are you fucking serious? I mean sure you could argue that some things should be legal, but you have to be pretty moronic to not realize that the police being able to do their jobs better is not a bad thing. Not that criminals won't use other means anyway..

Re:Secure = Traceable (1)

nurb432 (527695) | more than 2 years ago | (#39435261)

Or soon, ammo, or seeds to grow your own food. Or how about a used music CD..

Yes, this is *intended* to destroy anonymity.

I guess we can go to a barter system for those that don't like to have every movement tracked.

Re:Secure = Traceable (-1)

Anonymous Coward | more than 2 years ago | (#39435285)

Don't be silly. Your cash wouldn't be on his iPhone; he would have had to convert it to AppleCash for a small (30%) fee, in order to store it.

Re:Secure = Traceable (2)

0123456 (636235) | about 2 years ago | (#39434765)

If it's secure, it's traceable, otherwise you can duplicate it.

Chaumian digital cash is anonymous in at least one direction; the buyer or seller can be anonymous, but probably not both.

So long as you have to deposit the cash back at the bank after every transaction, duplication isn't possible... the cash is either accepted or rejected during the transaction.

Re:Secure = Traceable (0)

Anonymous Coward | about 2 years ago | (#39434897)

Traceable != personally identifiable. With bitcoin, for example, any coin can be traced back to its creation and all the steps along the way, but just to account numbers, which can be created by anyone at any time without the need to link them to any names.

Re:Secure = Traceable (1)

JoeMerchant (803320) | about 2 years ago | (#39435131)

The only reason AC is anonymous on /. is because they choose to throw away your IP address after you've submitted your post, at least I think they do, otherwise, you're traceable.

Yes, IP addresses can be spoofed, but only because nobody cares if they are.

People will care if money transactions are spoofed. Maybe Bitcoin servers actually threw away their traceability information on the account creators, but I doubt a "real" government backed system ever would. You certainly can't open a bank account in the U.S. anymore without a virtual background check.

Re:Secure = Traceable (0)

Anonymous Coward | about 2 years ago | (#39435163)

you're wrong. what low IQ clowns modded this up.

Right mind? (1)

Anonymous Coward | about 2 years ago | (#39434563)

What country in its right mind would back digital cash in this day and age? Certainly not the two examples given....

Re:Right mind? (2)

amiga3D (567632) | about 2 years ago | (#39434615)

Maybe the Swiss. Imagine a global digital currency backed by gold.

Re:Right mind? (0)

Anonymous Coward | about 2 years ago | (#39434695)

Pecunix and some others already do this

privacy (1, Interesting)

Anonymous Coward | about 2 years ago | (#39434583)

How do you hire a prostitute in Sweeden?... and you don't want that your wife knows about it.

The way I do it (2)

arcite (661011) | about 2 years ago | (#39434781)

Usually a few beers (Yes, I really am that good looking).

Re:The way I do it (0)

Anonymous Coward | more than 2 years ago | (#39435279)

but what to heterosexuals do?

answer depends on true reason to becom "cashless" (1, Insightful)

vleo (7933) | about 2 years ago | (#39434599)

1. Fiscal - not fully compatible with notion of anonymous cash
2. "Police State" - contradicts anonymous cash
3. safe on cost of paper money circulation - surely compatible
4. creating digital cash in order to fight SOME (maybe US) Govt. on pos 1 and 2 - very likely

Why would banks be against it? (1)

Grygus (1143095) | about 2 years ago | (#39434627)

Banks already live in a world of digital money. All that trading in stocks and bonds and even currencies? No physical money changes hands in those transactions; it's just numbers in databases. If banks are against this, then I have to believe they haven't been presented with a very good system; clearly they aren't against the very idea.

Re:Why would banks be against it? (3, Interesting)

JoeMerchant (803320) | about 2 years ago | (#39434769)

Bank transactions rely on open audits between the trading partners... you can't just say "hey, some guy just gave me $5M", you have to be able to verify where it came from, otherwise "some guy" can give the same $5M to 5 different banks.

My computer (and yours) can make a perfect copy of any string of 0s and 1s.

So-called digital cash relies on either special, supposedly un-copyable by the masses, hardware, such as in today's paper money, or traceable transactions recorded by trusted servers, such as today's bank to bank wire transfers.

If the traceability is implemented by the government, you can be sure that it will be accessible for "matters of national security," just as today's banking transactions are. The only way to make a secure transaction untraceable is to give something un-copyable to the parties doing the trading.

Re:Why would banks be against it? (1)

Grygus (1143095) | about 2 years ago | (#39434929)

Auditing works exactly the same either way. Actually it is much easier to audit digital funds.

My point is that far more money exists in U.S. dollars right now than the value of all the printed bills and minted coins combined, which means the dollar is already partially digital, no more real than bitcoins. It is tied to nothing physical, so its value is already somewhat arbitrary. I do not see how taking it digital would change very much for the banks.

Re:Why would banks be against it? (1)

leftover (210560) | about 2 years ago | (#39435153)

One word: "disintermediation". Banks and their avatars will oppose any purchase/payment mechanism in which they don't automatically get a slice of the pie. It would be in place already but the banks have yet to make someone else put all the infrastructure in place so they can start raking in profits from day one.

Anonymous authentication? Has been demonstrated multiple times; BTDT myself and all I got was a lousy T-shirt.

This reminds me... (1)

Anonymous Coward | about 2 years ago | (#39434641)

of the great book by Neal Stephenson, Cryptonomicon. No self-respecting geek has not heard of it. :)

Jews in the Attic (0)

Anonymous Coward | about 2 years ago | (#39434663)

This fails the Jews in the Attic test. No thank you.

Debit Card = Cashless. (2)

theNetImp (190602) | about 2 years ago | (#39434667)

When I lived in he US, I rarely carried cash. I used a debit card for 90% of my purchases, including food purchases. I saw no point on carrying anything but a $20 on me for the random times a place I frequented didn't have a mag strip reader for my card.

Re:Debit Card = Cashless. (3, Interesting)

Richard_at_work (517087) | about 2 years ago | (#39434783)

Precisely this. Remember that "A does not necessarily equal B", in this case digital cash does not automatically mean an anonymous currency - all money these days is digital in actuality, as no major currency is backed by a gold or silver standard anymore - new money is created by issuing it to an account in a computer, and it suddenly exists because the computer network says it does. Central banks move money to regional, trading and public banks by transferring it electronically, not by moving huge piles of notes around. Only when you actually take some physical money out of an ATM does it stop being digital.

And it's all traceable.

Remember that BitCoin also had several PR failures recently because of its irreversible feature - BitCoins were stolen, but there is no way to cancel that transaction even tho you can see where the money went because there is no way to reverse the procedure. Sort of the worst of both worlds, semi traceable but totally useless at the same time. Both better than and worse than cash at the same time.

Debit cards == crap. (1)

Anonymous Coward | about 2 years ago | (#39435055)

You also took on a lot of risk.

Here's what happens all too often: Someone takes your card, buys a ton of stuff which then depletes your bank account. So, your card gets rejected and you call the bank. The banks says that you spent all your money in the account. You say that they are all fraudulent. Banks says that they will have to investigate before they can give you any of your money back - two weeks minimum.

Oh, and if you happen to run up any charges, fees, or penalties because there wasn't any money in your account - let's say because of direct withdrawal to pay for a mortgage - tough luck! You owe the fees and penalties.

I've seen it happen way too much.

Use a credit card. That way if someone steals it, you got a buffer between you and your money. AND many times - not always - they give some good exchange rates when traveling; YMMV.

The UK tried this ahead of it's time... (4, Interesting)

ScottyLad (44798) | about 2 years ago | (#39434673)

Back in the 1990's, I was working on payment machines when the Mondex Trial [wikipedia.org] started out in Swindon.

Essentially, this was just a smart card which you could load up with cash - if you lost your card, then you'd lost whatever cash was on it at the time.

At the time, I thought it was a useful idea, and it did take off to a certain extent for micropayments, particularly in newsagents, but as far as I recall, the trial fizzled out an died after a while. I do recall at one point the promoters were trying to hand out free Mondex cards loaded up with £5 but the general public just weren't ready for the concept 20 years ago.

Re:The UK tried this ahead of it's time... (1)

0123456 (636235) | about 2 years ago | (#39434745)

From what I remember, Mondex was not anonymous. I may be wrong as it was very hard to find technical details at the time, but I'm pretty sure that was the conclusion.

Re:The UK tried this ahead of it's time... (0)

Anonymous Coward | about 2 years ago | (#39434967)

Mondex was touted as anonymous, but was secretly traceable.

Several years into the trial, a Canadian bank PR person admitted that, saying, "Of course Mondex had to be traceable. How else would we investigate fraudulent transactions?"

Re:The UK tried this ahead of it's time... (1)

ScottyLad (44798) | about 2 years ago | (#39435039)

I couldn't say for sure now as it was a long time ago, but it was the recollection of Mondex cards being handed out in the streets which made me think of it as an anonymous system, along with the emphasis placed on the value being stored in the card itself.

I certainly think it had it's advantages, whether anonymous or not - I don't generally carry cash with me, and get caught out anywhere that doesn't take cards (eg the coffee stall on client sites) or has a minimum transaction fee (my local newsagent). Obviously if you only load up via ATMs, or by debit card then there is a level of traceability, but I honestly can't remember the original privacy specifications now.

Having done a bit of digging around on the Internet this evening, it seems the Mondex was bought out by Mastercard in the late 1990's - long after I'd moved on to other things. I guess it's safe to say that in whatever guise any of the Mondex technology exists these days, it's unlikely to be anonymous.

There is an interesting site [mondex.org] showing some of the examples of the early cards I remember, and the original logo

Re:The UK tried this ahead of it's time... (1)

icebraining (1313345) | about 2 years ago | (#39435009)

Same here in Portugal in '94/95. Never really caught on, and they eventually killed the project in 2004.

Re:The UK tried this ahead of it's time... (1)

Dynedain (141758) | more than 2 years ago | (#39435331)

Hmmm... that reminds me...

The Oyster card in London which copycats the Octopus card in Hong Kong are both essentially anonymous digital payments. They were built as transit token systems and you can buy cards and fill them up at kiosks all over town anonymously. The cool thing though is that the card readers have been made available to private merchants as well (mostly convenience stores, restaurants, etc.)

From my experience with both, the HK version is far more widely used and seemed to work quite well.

Just trade goods and services (1)

PolygamousRanchKid (1290638) | about 2 years ago | (#39434691)

Folks in countries with high value-add or sales taxes revert to the dawn of civilization practice of just trading goods and services, with no monetary transaction. That way, there is no transaction to tax. Whether it is legal or not, is another matter. But a good way to avoid traceable digital transactions.

Money washers will be able to provide plenty of other tips.

Alternative currencies. (3, Interesting)

godel_56 (1287256) | about 2 years ago | (#39434693)

For the criminals, the simplest alternative would be to use another convertible currency for your transactions.

Euros, US dollars, whatever; as long as all countries haven't joined in to the digital cash trend, evil doers can just ignore it

After that, what . . . barter?

Re:Alternative currencies. (4, Informative)

crashumbc (1221174) | about 2 years ago | (#39434885)

There's a run right now in the US on "Tide" laundry detergent. It's being stolen and traded for drugs and cash. It sells "on the street" for about half what the store charges...

Re:Alternative currencies. (0)

Anonymous Coward | more than 2 years ago | (#39435317)

Gold. Or bags of cocaine

No problem (1)

M0j0_j0j0 (1250800) | about 2 years ago | (#39434705)

There is always "another currency". The first economy to make this step will be severely hit on forex markets, so it is s risky movem, wanna trace? fine, letsuse the neighbour country currency.

Re:No problem (0)

Anonymous Coward | about 2 years ago | (#39434787)

Interesting.... Had not thought of that. It would depress your own currency because yours is technically worth less than before. It would also drive up demand for the external currency. Probably Euros, dollars, or pounds... Yeah first mover in that area would kill demand for your money.

Re:No problem (1)

0123456 (636235) | about 2 years ago | (#39434803)

The interesting question is whether, if the US stops printing dollars, the existing physical dollars would become less valuable (no more state backing) or more valuable (no more state printing).

Re:No problem (1)

icebraining (1313345) | about 2 years ago | (#39435041)

That depends: would they still be legal tender?

Re:No problem (1)

Obfuscant (592200) | more than 2 years ago | (#39435269)

The interesting question is whether, if the US stops printing dollars, the existing physical dollars would become less valuable (no more state backing) or more valuable (no more state printing).

It would follow the pattern of every other country that stopped printing their own money and started using "something else". We have fine examples all over Europe from when all those countries changed to the Euro.

For a while, the dollars would not change in value. Then the backing country would stop honoring them so they'd drop drastically. After a (probably long) time, they would regain some value as rarities.

I don't know, how much can you sell a Dutch guilder for on the open market these days? Here [guardian.co.uk] , or here [ebay.com] , or best answer here. [worldofcoins.eu] Until 2032 a guilder in paper is still worth a guilder. Coins, not so much. Old siver and gold guilders are valuable, just like any old gold or silver coin. Run of the mill modern stuff? Less than the cost of the metal, probably. Just like the US penny currently.

Cashles = ownerless = carbon captured (0)

Anonymous Coward | about 2 years ago | (#39434719)

The cashless society is a dream of the banks, that like to decide what happens in society by assessing risk in investments. They only like centrally distributed energy because that conforms with centrally extended credit (bear with me). In a society where people can own and do stuff outside the scope of the banking system (like a lot of farmers that do most things in cash) the market can not be controlled, and renewables can not be kept out. This is the main goal, because the wholesale shift to renewables would greatly reduce bank cashflow and eventually elimintate it.This is the primary reason. If all transactions would be using cash or a digital cash equivalent like bitcoin or tubecoin certificates, people would be free from controls and this would mean the death of banks and the carbon based economy.

my site is www.greencheck.nl

Goodbye (1)

ChrisMaple (607946) | about 2 years ago | (#39434727)

With the last tie to reality removed, here comes unlimited inflation.

Re:Goodbye (1)

DigiShaman (671371) | about 2 years ago | (#39435075)

It will start with the Supermarkets using LED price tags that get updated wirelessly in the store. As inflation hits, the price gets updated daily. Before you know it, hyper inflation becomes so bad that real-time price updates can't keep up due to high frequency.

Screw that. Learn to barter. That will be the true "currency" of the future I'm afraid.

Back to barter & gold pieces! (0)

Anonymous Coward | about 2 years ago | (#39434733)

"If Bitcoin has taught us anything, it's possible to create an irreversible, cryptographic currency — but so far it has failed because it doesn't have sovereign backing."

What? Bitcoin has taught me if I have to ask "what the heck is that" I don't want to be paid in it. Money talks. Bitcoin... mumbles something about mining and Linden dollars and what not. As far as I know anyway. And I'm a dude who wants to get paid. Just not a dude who wants to understand bitcoins. "No, seriously, bitcoins count as money." Unless it's virtual goods and services for your virtual money. Take as many of my avatar dog sweaters as you want, pay me what you think they're worth. I'll make more.

The bank balance is already abstract enough for most people. A bank balance in an invented medium of exchange... dubious, even if it's not.

Re:Back to barter & gold pieces! (1)

icebraining (1313345) | about 2 years ago | (#39435069)

an invented medium of exchange

As opposed to dollars, which are mined from the Earth?

I think Bitcoin is irrelevant, but all currencies are invented, so that's hardly a problem.

Choice is good (1)

markdavis (642305) | about 2 years ago | (#39434735)

>"Really, though, I think this is a load of hot air. Physical money might be on the way out, but that doesn't mean the end of anonymous, untraceable cash"

I don't really agree with that statement. Most every form of electronic payment can be traced in a variety of ways. And something as elaborate as what was proposed in the posting can certainly have all kinds of security and privacy implications because it usually has to be funded in some manner and will still leave trails.

I don't want to have to perform a complex or electronic 3rd party transaction to give my neighbor $10 for picking me up something at the store, or $5 for a kid washing my car. That doesn't mean I don't like and use my credit card or pay some bills on-line. I just means I have a variety of methods that give me more flexibility.

The whole motivation of elimination of cash is not because it is good for citizens, it is because it is good for law enforcement or tax collection. Otherwise, there is no good reason to eliminate cash- just keep/add whatever OTHER electronic payment methods people might want. Choice is good.

Re:Choice is good (1)

0123456 (636235) | about 2 years ago | (#39434823)

The whole motivation of elimination of cash is not because it is good for citizens, it is because it is good for law enforcement or tax collection.

No, it's because it's good for control. Once all transactions are digital, anyone can be made a 'non-person' unable to buy or sell anything.

Imagine waking up one morning and finding that your 'payment card' had been disabled overnight.

Traceable Currency and Censorship (0)

Anonymous Coward | about 2 years ago | (#39434737)

At a time when government are trying to introduce censorship, block websites and pass internet three strike rule, don't expect them to make digital currency anonymous. Instead they will use excuse of fighting crime to require that it be traceable. And if you committ serious crime like file sharing, you'll be banned from trading. You'll be made outcast or your cash severely limited. Fascist dream come true. They can control whether you are allowed to trade or not. If you protest against government too much, no money for you.

Decades ago this might sounds like science fiction, but with the stupid law being pushed by U.S. entertainment lobby, this scenario is not too far off.

Re:Traceable Currency and Censorship (3, Insightful)

shentino (1139071) | about 2 years ago | (#39434873)

It sounds more like Revelations 13:17

Whoa? Really? (1)

um... Lucas (13147) | about 2 years ago | (#39434741)

MrSeb is hopelessly out of touch with reality if he thinks any country will issue an anonymous digital payment system. Well maybe some tax-haven might, but not likely since they want access to the international banking system. Do you not read the news at all, let alone releases from the senate, treasury department or IRS??

How many minutes would it take ... (1)

Tim Ward (514198) | about 2 years ago | (#39434749)

... for it to be hacked and broken, given that the entire criminal resources of the world, together with any hostile governments, would be in a race to see who could crack it first? The people at the Cambridge Computer Lab are also quite good at that sort of thing, but I wouldn't put any money on academics winning this race.

Re:How many minutes would it take ... (1)

JoeMerchant (803320) | about 2 years ago | (#39434855)

If it's a system without auditable transactions, it's already broken, you just need to keep a copy of your "digitally signed money" and use it again. If you're truly anonymous, nobody can tell which copy of the money is "real."

If it's a traceable, auditable system like today's bank-wire transactions, you can break it, but they'll catch you as soon as they check the transaction, which I believe takes less than a second. The cryptography is just to keep the rabble out, the real security is in the accounting.

big banks and megacorps (1)

indrek (590060) | about 2 years ago | (#39434755)

Have you ever heard about "big banks and megacorps lobbying for centralized, electronic, traceable currency"?

There are effectively as many (or more - depending on your world view) "big banks and megacorps" who would prefer anonymous, untracable cash, believe me.

Keep to the point. And the point might just not be "big banks and megacorps".

Once again: DO. NOT. WANT. (5, Insightful)

kheldan (1460303) | about 2 years ago | (#39434797)

I don't give a crap about who tracks what already. Cash may be one of the last bastions of anonymity and privacy left to us! If I want to pay for cash for everything I can, then I should be able to do that! What I buy at the grocery store, or what movie I go see, or what restaurant I eat at, etc. is nobody's business but mine. Aren't things already bad enough in this world? I can't say it loud enough: DO NOT WANT!

Re:Once again: DO. NOT. WANT. (1)

alienzed (732782) | about 2 years ago | (#39435057)

What if you buy bomb materials at the grocery, see a movie about making bombs and then go eat at the same restaurant the President is eating at...

Re:Once again: DO. NOT. WANT. (1)

ubermiester (883599) | more than 2 years ago | (#39435183)

is there any doubt that along the lines of the recent "do not track" legislation proposed in the US and the court rulings in the EU, there would inevitably be a do not track debit card? there are anonymous cell phones (pre-paids) so why not pre-paid debit cards - aka "gift cards"?

Racecar to the future! (1)

wreakyhavoc (1045750) | about 2 years ago | (#39434819)

No country, big or small, is going to issue or back anonymous, untraceable digital currency. You might think they have. But it will be backdoored. Bet your boots.

The only untraceable cash the US is going to issue and distribute will be pallet loads of $100 bills. "Oops, it seems we've misplaced several billion dollars in 'small' bills. Oh well, chalk it up to a rounding error. At least it was only billions."

The desire for "security"... (1)

gatfirls (1315141) | about 2 years ago | (#39434839)

...Would render any effort completely useless from the get go. No, not systems security silly, that other kind where you are more secure by the government being able to track anything and everything you or anyone else does on a whim.

What? (5, Insightful)

Dynedain (141758) | about 2 years ago | (#39434849)

It won't be easy to get governments to pass digital cash into law, though, not with big banks and megacorps lobbying for centralized, electronic, traceable currency.

You have that a bit backwards. It's not the megacorps lobbying for traceable currency, it's the government forcing the banks to have traceable currency so that they can monitor and shut down terrorists, drug cartels, tax frauds, etc. Hint: the term "money laundering" means moving money through transactions not traceable by the government. Plenty of banks and megacorps have in the past and continue to provide essentially untraceable transactions.

If Bitcoin has taught us anything, it's possible to create an irreversible, cryptographic currency — but so far it has failed because it doesn't have sovereign backing.

You're going to need to provide some evidence for the claim that bitcoins have failed because of a lack of sovereign entity backing them. There's a whole slew of other reasons that probably contribute far more to the poor adoption rate of bitcoins.

Why would any government endorse an untraceable digital currency scheme, when the whole point of the scheme is to circumvent the government's regulatory and investigatory powers?

Electronic Purse is Already Done (1)

mpapet (761907) | about 2 years ago | (#39434859)

Let's back up for a minute:

#1 reason for a country to go to an electronic purse is to eliminate the tremendous costs of managing currency. Think about the logistics required to keep money in an economy. It's not just "oh, ship $10 million USD to Las Vegas so peoples can gamble or whatever." It's an ENORMOUS HASSLE. Electronic purses are very tantalizing way to be far more efficient as a currency provider.

Banks and nations have mostly gone to a banking standard with a smart card providing a great degree of fraud protection for online transactions. "ONLINE" means anywhere a trusted network connection/payment terminal is set up. Done. Use a debit/credit card and any number of officious people can get that transaction information. Most of you guys and the girl reading this don't seem to mind this...

What you are attempting to discuss is OFFLINE transactions. This software is sometimes referred to as an electronic purse.

Bob wants to give Joe $10 for a cool Commodore 64 and there's no paper currency in the economy. So, Bob has his smart card and puts it into a dumb, untrusted reader. The reader device asks how much to transfer. Joe then sticks his card in and like magic $10 in value is added to Joe's card and Bob's is credited with no network connection. Can the transaction be fed back to some server? Depends on the electronic purse. Can you have a relatively anonymous system that works? Yes.

Lots worse privacy issues than this. It's just that it's not okay to talk about them. We got to protect ourselves from those Terrists and all.

Where's my mobile phone that is a pay terminal? USA is still in the stone ages making a killing with 'identity protection' schemes and magnetic stripes. Why? Banks make more money and it's pretty cheap.

Re:Electronic Purse is Already Done (1)

JoeMerchant (803320) | about 2 years ago | (#39434931)

Bob wants to give Joe $10 for a cool Commodore 64 and there's no paper currency in the economy. So, Bob has his smart card and puts it into a dumb, untrusted reader. The reader device asks how much to transfer. Joe then sticks his card in and like magic $10 in value is added to Joe's card and Bob's is credited with no network connection. Can the transaction be fed back to some server? Depends on the electronic purse. Can you have a relatively anonymous system that works? Yes.

Can Bob hack his smart card to give the same $10 to Suzy for other good and valuable consideration? Yes. Will Bob and Suzy be pissed off at Bob when they find out that he has handed them copies of the same $10 "digital cash"? Of course. If Bob's real name is Steve and he's just skipped out to Mexico, do you feel like your "untraceable electronic cash" is very secure?

I don't.

Rooting your bank account (1)

Spykk (823586) | about 2 years ago | (#39434865)

We would suddenly have an anonymous currency that can be kept on credit chips (or smartphones) and traded, just like paper money. No longer would handling money require expensive cash registers, safes, and secure collections; your smartphone could be your point of sale.

Anonymous currency stored on a perpetually networked device with a long list of known escalation exploits? What could possibly go wrong?

TFAs fantasy world (4, Informative)

WaffleMonster (969671) | about 2 years ago | (#39434867)

Bitcoin is not anonymous. Bitcoin transactions are necessarily public information.

You can't be anonymous (disconnected) while at the same time expect digital currency to remain globally consistant and secure. It's an oxymoron.

Even if it were possible it is unrealistic to assume a single government exists on the planet who would choose to implement such a system. Where is the value to the government in not being able to trace all transactions even if you ..wink wink nudge nudge don't know "who" owns what money at a point in time.

Re:TFAs fantasy world (1)

JoeMerchant (803320) | more than 2 years ago | (#39435217)

You can't be anonymous (disconnected) while at the same time expect digital currency to remain globally consistant and secure. It's an oxymoron.

It's the dopeler effect, an idea sounds bright and plausible if it's coming at you fast enough.

I continue to be astounded by the number of people who go on and on about how secure and simultaneously anonymous Bitcoin is...

Clue people: your Bitcoins are only as anonymous as the server allows you to be when opening an account.

Anybody cashing out Bitcoin for cash (or gold bullion) mailed to a P.O. Box? I didn't think so.

who the fuck approved this post comment as a story (1, Insightful)

Eponymous Hero (2090636) | about 2 years ago | (#39434887)

this is already a story: http://tech.slashdot.org/story/12/03/20/1542229/sweden-moving-towards-cashless-economy?sdsrc=rel [slashdot.org] . you just added another link to a different article about the same story. your whole summary is nothing more than a rant response that's more appropriate (if you can call it that at all) as a comment on the existing story. do you think phrasing speculation in the form of provocative, leading questions qualifies this as remotely informative? simply because cnn and fox news do it?

FTA:

When was the last time you used an ATM, anyway?

yesterday. i had to stand in line to use it too. bullshit fucking provocative speculation go fuck yourself til you die. let's pick apart another fallacy in TFA:

...this means that every move you make will be recorded in a huge database. Your bank will know where you get coffee in the morning, the route you take to work, and if there’s a vending machine at your office it might even know where you work. Likewise, your bank will know that you like to buy things on Amazon while you’re at work, that you enjoy watching X-rated movies when you’re on the road, and that you always leave it until the last moment to buy your wife a birthday present.... .... Well, get this, every credit card company, bank, and sizable corporation already tracks your transactions.

unless you pay with cash, then they don't. they even point this out right after telling you that all your usual cash transactions are somehow being tracked. fucking retards. die in a fire. "your bank will know that you like to buy things on Amazon.." -- they already do!! HOW THE FUCK DO YOU BUY ANYTHING ON AMAZON WITH CASH??? i wish i could choke this writer out and kick his astonished dog.

i also take offense to TFA's writer who puts out this little reality distortion field:

At this point it’s commonplace for self-respecting libertarians to leap up and decry the awful, privacy annihilation that I’ve just described. How could you live in a world where the Rockefellers can track your every move?! they cry.

the joke here is that libertarian = crazy, get-off-my-lawn tinfoil hat wearing cranks. a little straw man goes a long way. the writer wants you to feel like you're a crank if you believe your privacy is being threatened further than it already is, and he wants you to feel that it's ok simply because it already is being violated. what an asshole. fuck anyone who perpetuates this bullshit. by that logic it's ok to put arsenic in the drinking water, we already put fluoride in it! fuck you!

Re:who the fuck approved this post comment as a st (0)

Anonymous Coward | about 2 years ago | (#39434983)

I know that many credit card companies that give their affiliates all the spending habits of their users -- second hand from an affiliate. For example: If you've got Costco's name on your AMEX credit card, Costco knows where, when, on what, and how much money you're spending with their card. They use this information, mostly, to decide where to deploy stores, what to carry (i.e. if they see a large bump of people going to costco, then afterward going somewhere else to buy dogfood, they'll do something about their dogfood)

This isn't insidious or malicious -- it's just extremely valuable information for a business to have -- but it could definitely be used for insidious or malicious purposes by any asshole, and there are a lot of assholes in the world.

I called it! (1)

DigiShaman (671371) | about 2 years ago | (#39434903)

You can read my original post [slashdot.org] dated January 16th 2012.

Sometime in the future, it's quite possible that we will live in a cashless society. Lord knows the Federal Gov want's to tract each and every transaction. It would cut down on violent crime, drug abuse, and prevent tax evasion. It would also save by not having the Treasury create physical currency. It would also allow them to inject more money (inflation) in real-time into the system via a few keystrokes sort of speak.

Surviving the Cashless Cataclysm (0)

Anonymous Coward | about 2 years ago | (#39434937)

interesting read.

BitCoin didn't fail because of the lack of govt. (1)

sirwired (27582) | about 2 years ago | (#39434941)

BitCoin didn't fail because of the lack of government backing. It failed because it's expansion curve was stupidly chosen, leading to an impossible amount of deflation required (thousands of %) for it become anything larger than a geeky toy. The necessary deflation led to hoarding, which in turn led to illiquidity, which in turn led to downright insane swings in value.

Maybe BitCoin 2.0 will learn those lessons. But I have my doubts.

Re:BitCoin didn't fail because of the lack of govt (1)

Wonko the Sane (25252) | more than 2 years ago | (#39435235)

Bitcoin failed? When did this happen?

TFS (1)

Nethead (1563) | about 2 years ago | (#39434971)

What if the US or UK (or any other country for that matter) issued digital cash?

I think Greece is thanking you right now.

Ok, a few reasons why it's not really a good idea (5, Insightful)

Opportunist (166417) | about 2 years ago | (#39434973)

First, the obvious: How do you pay someone who doesn't have the means to register your payment? Private to private money deals will become virtually impossible unless both parties have some kind of electronic device on them permanently. And it may be unbelievable to some, but there are still people who refuse to carry a smart phone around. How do I lend my buddy 10 bucks if he has no means to receive them?

Then, the criminal. Untraceable, yeah, sure, tell someone who believes you. Criminals will not use it. Instead, they will keep the cash in circulation. And why shouldn't they? The very first thing I will do as soon as it becomes a fact that this goes through is to go to the bank and withdraw as much money as I can in the lowest possible bills available. Trust me, this money will become more and more valuable as time goes by, as it is used for back alley deals and as it gets out of circulation because of busts and people returning it to their account. ANY currency that you can only spend but not collect becomes more valuable over time, as long as there are people who give it value. And that stuff WILL be valuable, and if not, I can always still hand it back to the bank and deposit it. The alternative being, of course, that some foreign currency suddenly becomes the street bill. For reference, see Cuba. You want something aside of the state-approved crap? You better have greenbacks with you.

And finally, how about people who do not get a bank account? It's not like it's possible for them to have a halfway decent life now, but then, it will become virtually impossible. Try to get a job in Europe without a bank account. Just try. No such luck. There is NO way you will be paid in cash. No company I know of will ever even consider doing it. Now on the other hand, try to open an account if you're homeless. Try it. I dare you. How the heck do you think these people will ever get back on their feet? Because then your excuse "if he really wanted, he could" doesn't work anymore. He CANNOT anymore.

What? (2)

TheCarp (96830) | about 2 years ago | (#39434977)

Bitcoin, last I checked, had not failed, and was still in use. Having used it in the past myself, I remember it being rather easy to get my money in and out. So... failed? So rising to $5/coin is failure? Or is it just because the $30 bubble burst?

Bitcoin is deeply flawed, but, as of one of just a handful of largish attempts at a non-soverign digital currency, I would say the lack of government backing is hardly a proven requirement, any more than a few early flight failures proved that flight was impossible.

We are screwed here's why (1)

koan (80826) | about 2 years ago | (#39435005)

"it doesn't have sovereign backing"

It never will because it doesn't benefit nation states to use it nor will the "One World Bank" allow transfer of it, in addition there will be a stigma attached to things like Bitcoin or other black market funds, "Why you using that? You doing something illegal?"
When everyone used cash there was no telling what you were using it for, now every purchase will be documented, and saved for your lifetime.

In addition once we live in a cashless society you will see the rise of "micro charges" "Oh you want water with your meal? That's 0.5 credits" literally everything will start to have micro charges of pennies/credits (or equivalent) it will become so prevalent you will go to the bathroom and a paper towel will cost 2 cents, and soon 1 cent here 4 cents there it adds up.
Literally anything can and will have a micro charge device attached to it, go shopping for groceries and want a cart or bag? 0.25 credits.
You see since it's a card the charging can be automated, so even charging pennies for a common item like a grocery cart can be profitable.

A cashless society is the ultimate form of control and in the end gives governments and banks full control of the planet, you don't agree?

Fuck you your card is shut off.

Re:We are screwed here's why (1)

geekoid (135745) | about 2 years ago | (#39435177)

That's a lot of wild ass speculation that overlooks in real world facts.

But then again you're an idiot.

Tax Cheating... (0)

Anonymous Coward | about 2 years ago | (#39435031)

I have lived in Sweden and have plenty of Swedish family members. The taxes are too high. You can't nearly find a plumber who'll accept anything but cash. I am dead serious here. I have an uncle in law who's house burned down due to Lightning, he called several builders to find one who would accept his insurance money which meant that the builder would have to pay full tax on the income. He heard the following when telling builders it was 100% insured, "Our official work load is already full for the next 2 years." This wasn't just one place or two but several. They could start work in a few months if a large portion was paid out in cash under the table. I know people will find new ways to cheat the system but I just don't think cash is going anywhere in Sweden it would be economic collapse.

Government-backed anonymous currency? (1)

Arancaytar (966377) | about 2 years ago | (#39435083)

What if the US or UK (or any other country for that matter) issued digital cash?

"Yeah, we're really unhappy with how traceable electronic cash is. By all means, let's issue a government-backed anonymous currency to ensure people once again can transfer money without us watching. We'll get right on that."

What would be the motivation? (1)

mccrew (62494) | about 2 years ago | (#39435087)

What if the US or UK (or any other country for that matter) issued digital cash? We would suddenly have an anonymous currency that can be kept on credit chips (or smartphones) and traded, just like paper money.

The one and only question I have is what would be the motivation for the US or UK to create anonymous digital cash?

Digital currency is not a problem in itself (1)

Hentes (2461350) | about 2 years ago | (#39435127)

With correct legislation reasonable privacy can be preserved even with digital currency. Forbid banks from selling the data and require a warrant for the police to peep into it.

Would this even reduce crime? (1)

grriffin (960397) | more than 2 years ago | (#39435189)

Credit card numbers are stolen and sold all the time now. Wouldn't criminal organizations just put more focus on stealing physical objects or numbers that are not tied to them? I would assume that they have some success in using these stolen cards without getting caught or else it wouldn't be such a common target and hot commodity. So we'd trade a system where the average joe (plus criminals) can remain anonymous, for one where criminals will remain anonymous and the average Joe will be sent purchase history related ads.

Said it before and I'll say it again (1)

Yvanhoe (564877) | more than 2 years ago | (#39435341)

Bitcoin is not anonymous and is damn well traceable. In fact, all the transactions are public. The hard thing is to put a name behind an account, and so far the lack of a raidable authority has made this a bit more difficult to identify account owners but bitcoin has not been designed for privacy but for resilience and lack of a central point of failure.

What you can do anonymously is run a bitcoin node over Tor. How, and by the way, it has not failed. A speculation peak and a crash was exactly what was expeced for the seeding phase.

A cashless society would effectively destroy privacy of transactions.
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