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0 pointsdanbruc8y ago0 comments

So the entire thing starts with everyone having a balance of zero. Then A signs a transaction that he gives $1000 to B and we broadcast that transaction, new balances A $-1000, B $+1000. Now B wants to buy something for $500 from C and signs a matching transaction. What does C do? Is A a bank that provided a $1000 loan and therefore C will be able to actually get $500 from A? Or are A and B one and the same poor guy who just created two keys and invented $1000 out of thin air?

Maybe I am missing something but I have no idea how that could ever work unless this is essentially just the current banking system were I know that A is a trustworthy bank and I will be able to redeem your $500 check. Augmented with the anti-feature that we are now all broadcasting our balances and all our transactions to everyone.

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state_less8y ago· 3 in thread

The important part is A signed over to B $1000. B and C may be the same person. B wanting to do business as C.

If A, B and C are all the same person and there wasn't an identity attached to any account, outsiders wouldn't value the record much, especially if they were transactions of significant value.

C could redeem the value with Western Union (or similar agent). They might say you have to agree to sign the closure of the account to no longer modify the balance of the account. They'd basically be like a collections agency, buying debt.

You'd be able to have similar plausible deniability as Bitcoin. Coinbase sees the transaction flows and the ledger is public. You could do business as a pseudo identity ( Do business as C, if you're B )

icebraining8y ago

Thing is, why would Western Union want to buy the debt unless they knew who A is and if they have any hope of collecting from them? This would probably only work if A was a known entity, and generally trusted to have the money they signed over. But if they are, why do we need Western Union at all? Just have C go to A to ask for the money. And if A is an publicly-known entity that exchanges signed amounts for the underlying currency, they're essentially an Exchange.

Combining this, you essentially get GNU Taler: https://taler.net/

No proof-of-work, just a way for people to get digital money (representing USD, gold, or anything else) issued by A (Exchanges). And rather than regular signatories they use blind ones, so that A doesn't even know that B spent its coins on C.

lmm8y ago

> If A, B and C are all the same person and there wasn't an identity attached to any account, outsiders wouldn't value the record much, especially if they were transactions of significant value.

Right. The only way B "really" has a balance of $1000 is if A is some established, trustworthy entity - e.g. an actual bank. And trustworthy entities that offer service to anonymous people don't stay trustworthy for long.

jacobush8y ago

"similar plausible deniability as Bitcoin" - not very much, then.

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