From hungary-online-owner Mon Mar 13 06:02:14 1995 Return-Path: owner-Hungary-Online-announce Received: from localhost (daemon@localhost) (fnord) by nando.yak.net (8.6.5/8.6.5) id GAA05517 for hungary-online-announce-out31415; Mon, 13 Mar 1995 06:02:14 -0800 Received: from localhost (daemon@localhost) (fnord) by nando.yak.net (8.6.5/8.6.5) id GAA05506 for hungary-online-announce; Mon, 13 Mar 1995 06:01:53 -0800 Received: via =-=-=-=-= from carlson@odin.net for hol-announce@hungary.yak.net (hungary-online-announce) Received: from odin.net (omega.odin.net [193.130.116.3]) (fnord) by nando (8.6.5/8.6.5) with ESMTP id FAA05191 for ; Mon, 13 Mar 1995 05:58:24 -0800 Received: from [193.130.116.13] by odin.net with SMTP (8.6.10/1.2-btv) id PAA29859; Mon, 13 Mar 1995 15:13:45 GMT Message-Id: Mime-Version: 1.0 Content-Type: text/plain; charset="us-ascii" Date: Mon, 13 Mar 1995 14:53:29 +0100 To: hol-announce@hungary.yak.net From: carlson@odin.net (Steven Carlson) Subject: (HOL-A) HOL> digital cash Sender: owner-Hungary-Online-announce@hungary.yak.net Precedence: bulk Reply-To: Hungary-Online@hungary.yak.net hungary-online World may not be ready for digital cash by Steven Carlson Most of the world's money is nothing more than electronic ones and zeros. When you cash your monthly paycheck, no physical currency passes from the boss' bank to yours. Your bank account increases, the company's decreases; the difference is made up in electrons. Of course if you live in Hungary, you're probably paid in cash. And if you live in Hungary you've probably come to the conclusion that cash is a very useful thing. Cash is anonymous. (Not that any of us have anything to hide, naturally). And cash is money in hand - a done deal. This is not necessarily true of bank transfers, checks, credit cards and IOUs. I learned this the hard way in 1991 when I nearly lost my shirt doing business with a major Hungarian savings bank called OTP. I was shocked to learn that, while my clients were putting money in at one end of the bank, the other end of the bank - where I could take money out - didn't hear this news until several weeks later. All that time, I imagine, they were passing chits from one office to the next. It's now 1995 and I feel reasonably confident they've since bought computers. A great deal of banking has to do with moving data. Banks generate most of the data that passes through the world's computer networks. Think of this as institutional electronic money. You can't see it. You can't spend it. Few people even know it exists. Yet this electronic money is the lifeblood that warms the veins of our global economy. One institution - the Clearing House Interbank Payment System - moves an average of one trillion dollars each day. But this doesn't necessarily mean we're moving toward a cashless economy. Even if we use less and less paper currency, we may still need electronic money that works like cash. We may need digital cash. As I wrote last week, several leading banks and credit card companies are gearing up to introduce personal electronic payment systems. Using a PC we will be able to go shopping and do banking. Some of us will even open up shop on the Internet. The Big Boys are betting these personal electronic payments will be a $2 billion industry within five years. However credit cards have several drawbacks. Credit cards and debit cards are issued by banks, who charge a surplus to both the user and the merchant who accepts them. Each transaction must be verified in real time; and this costs money too. Denmark introduced a smart card a few years back that became so popular it overloaded the phone system. But worst of all, cards create a record of your transactions. Sometimes it's handy that your credit card creates a record of your spending. But you may not want others to have that record. You may not fear Big Brother. But how about your competitor? How about the nosy neighbor kid with a modem and time on his hands? In an increasingly networked world your privacy is under threat. You may not realize it, but the computer network at your workplace probably keeps track of what hours you're logged on. Certain software can track what percentage of time you spend on what tasks. Other software can even recognize hundreds of computer games and report your Tetris addiction to the boss. That's not all. Many technologies in development have privacy implications their builders have not even considered. For example, several governments are now funding Intelligent Transportation Systems, or Smart Roads. These systems would deliver drivers detailed traffic information, collect tolls automatically, and even aid in law enforcement. The scary part is these roads could quite easily collect and store information about every vehicle passing over them. That information could help track and capture criminals. But that data could also be sold to marketeers, debt collectors, or information brokers. Who has the right to your personal information? Digital cash is completely anonymous. That pleases privacy advocates but it is sure to outrage governments. After all if we could send our money flying around the world with narry a trace, who would pay taxes? This is the one major argument against digital cash. The other is that nobody yet accepts digital cash. It does, however, exist. The product is Ecash; the maker is a Dutch company called DigiCash. You can find them on the World Wide Web at or send an email to . Ecash works. Last summer DigiCash began a test in which volunteers were issued $1 million worth of Ecash to test with volunteer WWW resellers. I and others found the software easy to use and reliable. There seemed to be no technical glitches. However I've since heard nothing from DigiCash. It may yet be early for digital cash. [blurb] Steven Carlson is an Internet trainer and technology writer --- Steven Carlson Moderator/Publisher - hungary-online Critical Mass Media Inc. Internet trainer, consultant [+361] 133-4647 in Budapest, Hungary carlson@odin.net ############# # This message to Hungary-Online-announce@hungary.yak.net # was from carlson@odin.net (Steven Carlson) # # To unsubscribe, # send "unsubscribe" to # For a full subscription (rather than this announcement-only subscription) # mail "subscribe" to # Send mail to for more information, # or to if you need human assistance. #############