[Cryptography] Electronic currency revived after 20-year hiatus

[Robert Hettinga]

Popped up in a standing google trawl I have out for “blind signature”. 

First one that’s hit in years.

Cheers,
RAH
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http://www.afr.com/brand/chanticleer/electronic-currency-revived-after-20year-hiatus-20160815-gqt3hz


Electronic currency revived after 20-year hiatus

	• Chanticleer
	• Aug 15 2016 at 11:45 PM
	• Updated Aug 15 2016 at 11:45 PM

Talk to any central banker about the future of currencies and they will agree that we are heading towards a world of electronic money.

Nobody is quite sure when it will happen or exactly what digital currencies will look like. But there is a growing realisation that the ideal solution will not involve a debit and credit in some ledger in cyberspace.

In other words, the utopian world of electronic currencies is unlikely to involve the technology behind Bitcoin, called Blockchain.

That brings us to the launch, or should that be relaunch, of digi.cash by an Australian company funded by Capital Markets Co-operative Research Centre.

This is an electronic currency in the truest sense of the term. The money is in the form of bytes of data which can be transferred electronically. Initially it is only available in Australian dollars.

The ownership of the currency is not determined by an account balance held in a ledger somewhere.

The technology behind digi.cash is an extension of the cryptographic protocols developed by American tech entrepreneur David Chaum in the 1980s.

Chaum launched the world's first crypto-currency in the 1990s but it failed miserably. Like so many tech inventions it was ahead of its time. In the 1990s when it hit the market, total e-commerce was estimated at about $1 million.

When his crypto-currency failed to gain traction, Chaum turned his attention to a range of other ground-breaking projects including an encrypted messaging system.

Twenty years later digi.cash has a new lease of life with the backing of a group of engineers and scientists in Sydney led by Andreas Furche. The backers include one of the co-leaders of the Australian team that invented Wi-Fi, Dave Skellern, and former Westpac Banking Corp executive Peter Clare.

It works this way: the electronic version of the currency is digitally minted as electronically signed coins and banknotes. These can be held on a smartphone, computers or storage devices.

The money can be transferred between online users. The encryption technology means that the electronic banknotes can circulate securely without the risk of theft or counterfeiting.

Furche says the cryptography allows the payer of a transaction to remain untraceable. The currency is created and transferred as 500 byte long RSA blind signature tokens, which allow the payer in a transaction to remain untraceable. RSA refers to the three men who invented the first global public key cryptography, Ron Rivest, Adi Shamir and Len Adleman.

Chaum extended the work done by Rivest, Shamir and Adleman with the addition of a blind signature protocol which is part of digi.cash.

The digital currency is operating under an exemption from the Reserve Bank of Australia which limits total funds on issue to $10 million.