[kwlug-disc] Bank of Canada launching public consultations on a digital dollar

[Chris Frey]

On Fri, May 12, 2023 at 04:20:11PM -0400, Doug Moen wrote:
> blockchain is public. But a hardware implementation can also prevent cash
> from being duplicated, without the cash balance in your wallet being public
> knowledge, so a blockchain isn't needed. If you can transfer cash to and from
> a MintChip at an ATM, then there is a loss of privacy at that interface, but
> it's no better or worse than cash. Two people with MintChips could exchange
> digital cash without loss of privacy. using a card to card crypto protocol.
> 
> This system could be equivalent to physical cash from a privacy and freedom
> perspective, without some of the downsides of Bitcoin. Like, it could support
> truly anonymous transactions, and it could be pegged to the Canadian dollar,
> so you don't have the insecurity of a wildly volatile currency.

Reading up on the MintChip, looks like a cool idea.  But it all hinges
on the security of the physical secure chip.  How secure is a secure chip?

If there is no central database tracking payments, then the motivation
would be fairly high to crack the protocol and the chip in order to
spoof millions and millions of dollars.  And the hardware would be in
the attacker's hands, which is the weakest point to be for hacking.

One part of the website said:

	The MintChip system is deliberately designed for changes to
	both the chips and cryptographic mechanisms in a transparent
	fashion. It is even possible to force the expiry of a particular
	MintChip platform version.

So they could turn off the digital cash system if needed, but only on
a system wide scale.

I like what lengths they went to, to keep anonymous and offline payment
support.  I fear that people are much more willing to give that up these
days, when the new version of digital money rolls around.

- Chris