Payments as an answer to spam

[Adam Back]

In the case of micromint I agree, there still has to be a centralised
mint, so one can reasonably make a direct economic comparison with
blind signature based coins or whatever and do the cost benefit
analysis and decide which scheme to use (micromint may be cheaper per
coin after the large initial investment has been recovered); however
with hashcash it's major advantage is that it doesn't require any
infrastructure.

Having a centralised e-cash bank issuing coins (or a group of banks
with inter-bank clearing) is a highly non-trivial task when you're
talking about micropayments that are expected to be attached to every
email.  The volume alone is staggering.  And it's not clear what the
minimum transaction cost for the system would be where the bank could
remain profitable after paying infrastructure costs, staff costs to
maintain security of their bank private keys -- this minimum
translates into a real monetary cost to the sender.  With hashcash,
there is effectively no monetary cost to the normal sender; for the
spammer there is, but I think economists might agree that having
spammers sitting in the corner burning dollar bills to be able to spam
is a net good if it is more efficient overall in saved human
resources, or perhaps feasible where real ecash may not be in the
sense of the profitability of it.  (Hashcash doesn't need a business
model where a bank has to turn a profit because there is no bank, nor
private keys to secure etc).

Adam

On Tue, May 13, 2003 at 09:45:39AM -0400, Ian Grigg wrote:
> As a footnote from economics, it is considered
> a bad thing to create a monetary system that
> bases its scarcity on destruction of assets.  [...]
> 
> This applies to hashcash (c.f. Adam B.) or
> those various hash collision schemes of
> tokenising money (c.f. Ron R?).  Pretty
> much all of these schemes can be done more
> practically just by doing plain-old-digital-
> signatures (PODS?).

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