
The Royal Canadian Mint just announced a new alternative to BitCoin - jonny_eh
http://developer.mintchipchallenge.com/
======
jimrandomh
This is a big step backwards from the security of Bitcoin. All someone has to
do is break open the hardware and extract its key (or take its key with a
side-channel attack) and they can double-spend money. That's problem one.
Bitcoin's entire byzantine protocol exists entirely to solve the double-spend
problem, and it works, while this doesn't.

Every MintChip has an ID, and every transaction is logged on both the sending
and receiving device with the ID of the other device. This means that if
someone takes your chip, they get a complete record of every transaction
you've ever made. In other words, it's not anonymous at all. That's problem
two. Bitcoin solves this by encouraging users to generate a new
address/private key for every incoming transaction, so that matching up
addresses to people is hard.

It's tied to single physical devices which can be lost or damaged. This makes
them unsuitable for storing savings. Bitcoin wallets, on the other hand, can
be backed up securely.

Both MintChip and Bitcoin can be stolen if the attached device is compromised.
Bitcoin is designed in a way that makes it possible to fix that, and
developers are working on a fix: multi-signature transactions (so you have
several computers, or a computer and a phone, and all of them must agree to
any outgoing transaction). MintChip, however, cannot solve this problem in any
way except with chargebacks, and the documentation given so far indicates that
they aren't supporting that.

~~~
Retric
The largest problem with Bitcoin has always been how insecure peoples
computers are. WoW accounts where only worth a few dollars and yet account
hacking was incredibly common unless you used a physical authenticator tied to
your account. Thus, to securely use Bitcoin you really need a third party
either a 'bank' or a vary secure device.

PS: Banking websites have their own issues. But because they tend to use
multitiple forms of authentication the are significantly harder to break into
on the client side.

~~~
dvide
That's not really true. You can store Bitcoin keys on paper with QR codes (or
even just in your brain), and sign transactions on devices that have never
touched the internet and never will. It's just the infrastructure that hasn't
been built yet, but there is a lot of development going on to enable the
average user to utilize these possibilities. That's not even mentioning multi-
signature transaction support.

~~~
Retric
I don't mean to suggest that Bitcoin can't adapt. Just that most of the
advantages it has over physical / digital cash or credit disappears once you
add such things. Once you have a bank or physical device governments will get
into the game and start regulating with the express goal of eliminating
anonymity for large transactions.

~~~
dvide
"... most of the advantages it has over physical / digital cash or credit
disappears once you add such things. Once you have a ... physical device
governments will get into the game and start regulating"

Not sure what you mean. By 'device' I didn't mean some special hardware
developed by some special company, where the government can then regulate that
industry. I just meant any computer. I'm saying that signing a transaction can
be done offline on devices that are never connected to the Internet, such as
an old laptop, or yes even a special device. There's no fundamental
requirement to have the keys on your virus-ridden home PC at any time. This
doesn't remove any of Bitcoin's advantages from what I can see.

And multi-signature transactions will allow for multi-factor authentication at
a protocol level.

~~~
Retric
That's significantly worse from a user perspective than giving Amazon a credit
card number to enable one click checkout or downloading a book from my kindle.
It's true you could do anonymous transactions online, but while it's better
than mailing people cash it's something of an edge case and I could also buy a
Visa gift card and get the same sort of anonymity. Again, I like Bitcoin, but
the problem IMO is how to make it both as convenient as a credit card and
secure.

PS: Your also describing an adhock solution. As soon as you want to mass
produce them to allow significant and convenient adoption you get into
regulation issues. And by 'device' I am including just the software to manage
your account from a cheap netbook.

------
oskarpearson
In the spirit of "extraordinary claims require extraordinary proof", has
anyone verified this?

Problems:

1) No mention on the Royal Mint website that I can see. News releases seem to
normally be on [http://www.mint.ca/store/mint/about-the-mint/news-
releases-7...](http://www.mint.ca/store/mint/about-the-mint/news-
releases-700002)

2) Whois should probably point to Royal Mint, not this person's house, and not
to a hotmail address.

Administrative Contact: Zaykova, Vessela vessyz@hotmail.com

Address: 131 Camelia Ave, Ottawa, Ontario, K1K 2X5 This is a suburb.
Streetview: <http://bit.ly/HMFiMB>

3) Domain is registered through GoDaddy, which IMHO is a bad sign... like
having a hotmail address ;)

4) Site T&C say the site is operated by ChallengePost.

ChallengePost has been listed on techcrunch:
<http://www.crunchbase.com/company/challengepost>

ChallengePost.com has their domain registered through GoDaddy though, so
perhaps I'm wrong about that signal :)

5) No mention on the ChallengePost blog at <http://blog.challengepost.com/>

6) Vessela Zaykova does apparently work for the Royal mint though, according
to <http://ca.linkedin.com/in/vessela>

So - very interesting news, an inadvertent early leak, or very elaborate hoax?

Oskar

~~~
msgr1
I am CEO of ChallengePost and this challenge is real:
<http://mintchipchallenge.com> <http://challengepost.com/discover>

Note how excited we are that the winners receive gold bars. -Brandon

~~~
tpurves
Why is there no public announcement of this? Why does the actual Canadian Mint
website have no links or mentions of this project? Why are there goats and
wheat on your webpage? What is this for, some digitally enabled 19th century
version of Canada? What kind of goofy hoax is this?

~~~
msgr1
Back in the day, people used goats for currency. Then it became wheat, then
coins, then... you get the picture.

The Mint will be issuing a press release momentarily.

~~~
Estragon
The ancient Irish used slave girls

[http://books.google.com/books?id=GYhajCQU8XIC&lpg=PT345&...](http://books.google.com/books?id=GYhajCQU8XIC&lpg=PT345&pg=PT281)

------
cs702
The MintChip is _not even comparable_ to Bitcoin: it's not decentralized; it's
not resistant to a Byzantine Generals-type attack; the supply of coin is not
fixed; security is implemented via "tamper-proof" (ha-ha) hardware... the
whole scheme looks rather hackable. IMO it's not a real alternative to
Bitcoin.

This strikes me as an attempt by the Royal Canadian Mint to disintermediate
credit card companies by offering a new, low-cost, "irrevocable," centrally-
controlled payment system.

~~~
yk_42
> This strikes me as an attempt by the Royal Canadian Mint to disintermediate
> credit card companies by offering a new, low-cost, "irrevocable," centrally-
> controlled payment system.

This seems to be exactly what they're doing. From the Developer Guide,
Background page: "The emerging digital economy must be able to accommodate
small-value transactions, such as micro transactions (under $10) and nano-
transactions (under $1). The Mint hopes that software developers and
entrepreneurs will use MintChip to ignite trade and commerce for these very-
low-value markets."

The title of this post equates MintChip to BitCoin, but the two appear to have
significantly different goals. MintChip may end up being the digital
equivalent of pocket change.

~~~
unconed
Smartcard wallets for small transactions have been tried ages ago and failed,
like this:

<http://en.wikipedia.org/wiki/Proton_(bank_card)>

Having used this myself, the problems were numerous. First of all, it's
effectively a new currency, so you have to explicitly convert your cash money
into this form. This sucks. But because it's meant for small purchases, you'll
only ever have pocket change on there, which means your balance runs out all
the time. The card doesn't display its value, so you risk looking like an
idiot and pissing off every customer behind you when they see you tried to pay
the 'fancy way' and failed.

Of course, today things are different, and the web is hugely important, and
most of us carry smartphones. But do you really want your ability to use money
to be tied to your phone's flakey battery?

------
gravitronic
Edit: The headline is really misleading (and subsequent comparison to
bitcoin). A much better analogy is that this is paypal with hardware tokens
capable of completing transfers offline. You are transferring canadian
dollars.

From a 2-minute introduction this looks like it's based on trusted computing
in offline situations, since you don't need cloud acceptance of a transacation
ala bitcoin.

If that's the case, there's nothing making this unhackable.

I wonder what's the timeframe before we see a illicit "client" that creates
value transactions without deducting from the user's balance. There will
certainly be a huge effort to create such a thing.

update as I read more: It's optionally an SD card or a USB stick. clever way
to interface to most every existing phone/laptop!

------
mindslight
"Trusted" hardware for a _monetary system_ in 2012 ? (Did the Yes Men create
this site for April Fools?)

With the backing of a bank, it's possible to be anonymous, offline, _and_
prevent double spends with standard user-trustable computation - really, I kid
you not.

[http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.46.4...](http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.46.4776)

~~~
Groxx
You wouldn't happen to have a short summary handy, would you? That's more math
notation than I have time for at the moment.

~~~
mindslight
It's been a while, but IIRC:

It relies on having a third party that's trusted to be a reliable provider for
value and knowing customers identities to punish double spenders (a Bank).
(You can give up this requirement if you want to give up one of the other
qualities I mentioned above, but those are different papers ;)

1\. An account holder looking to spend creates a coin through a mutual process
with the bank, which debits their account. The bank is unaware of the identity
of the coin, but knows that it conforms to certain properties.

2\. The coin is comprised of multiple parts P_1 - P_n, each of which has two
pieces, P_i_1 and P_i_2. The account identity is encoded in the coin such that
it is recoverable if and only if one has _both_ P_i_1 and P_i_2 for any _i_.

3\. To spend, for all _i_ , a merchant requests _either_ P_i_1 _or_ P_i_2.
(most likely based on the merchant's identity).

4\. The merchant eventually turns these coin parts over to the bank, which
credits their account. If the bank sees multiple spends of the same coin, only
then can it put two corresponding pieces together and deduce the account
holder's identity.

There are of course many details that force the parties to behave honestly at
every step. The paper is somewhat old and I have no idea of further work (I'm
not especially interested in protocols that require a bank or user
identities). Main point being that if you _do_ have a bank, designing
protocols becomes much easier (Simple blind-signature tokens, for instance.
These are anonymous but require online transactions).

~~~
Groxx
Sounds like it can only catch some % of double-spends, which might be good
enough (assuming the coins are small enough, odds of missing anything
important are tiny).

Now I'm interested in how step 1 is accomplished, but that's probably too
involved for a comment - I have the paper, I'll see if I can figure it out.

Thanks! That was very helpful. A quick skim of the paper backs up what I could
find, so it looks like you remembered well enough :)

~~~
mindslight
I believe the paper specifies the challenge from the merchant as possibly
random or based on the merchant's identity. Random most likely means that _n_
becomes a bit-security parameter that has to become reasonably large so the
chance of collision is extremely low (as I think the spender can always walk
away after receiving the challenge).

I think setting n = log_2(maximumNumberOfMerchants) and hardcoding which
merchants ask for which pieces is a straightforward way of preventing all
unpunished double spends while keeping _n_ relatively small. BTW, with general
progress of zero-knowledge techniques I'd be surprised if there weren't a more
modern and concise paper in the same vein.

------
mindstab
[http://developer.mintchipchallenge.com/devguide/differentiat...](http://developer.mintchipchallenge.com/devguide/differentiators.html)

So current hardware solutions like visa and debit are secure because they use
a trusted 3rd party. And not anonymous.

Bitcoin traded trusted 3rd party for trusted cloud (its p2p nature) and so was
still not really anon if you put in any effort.

This is supposed to be 3rd party-less, fully anon. So thats a lot of trust in
the hardware. It does seem uniquely vulnerable in ways we haven't before seen
with visa and debit or bitcoin.

~~~
gravitronic
I believe the target for strictly-hardware transactions is to keep them low-
monetary value. For example a digital replacement for the $10 you keep in your
wallet to buy lunch from a hot dog vendor.

Not saying the potential for a hardware exploit resulting in a money tree
isn't there...

------
msgr1
And a software dev challenge to go with it where you can win $50K in gold
bars. <http://mintchipchallenge.com>

~~~
ben1040
Also of note: according to the rules, it's open to Americans as well as
Canadians:

<http://mintchipchallenge.com/rules>

~~~
oskarpearson
It's also open to corporations in the same locations from a quick glance on my
side.

My guess is that us foreigners could register a company in Delaware etc, and
compete.

------
elchief
when did the Royal Canadian Mint become innovative? drop the penny. start
bitcoin 2. go canada!

~~~
ahelwer
Switching to polymer notes, too. Someone needs to investigate these
happenings!

~~~
Foy
Our plastic monopoly money is the bees knees.

But in all seriousness, if MintChip is for real and doesn't get hacked, and if
I can finally say good bye to the penny (which I have already been getting rid
of for over 2 years) then I'll have to admit that the Mint is probably more
innovative than any other government entity up here. :)

------
evincarofautumn
Is that…a stock photo of code?

    
    
        /**
         * Creates a new demo.
         * @param o The object to demo
         */
        public Demo(Object o) {
            this.o = o;
            String s = CONSTANT;
            int i = 1;
        }
    

That aside, this is basically a good idea with laughably poor execution. Other
comments have addressed that it’s centralised and non-anonymous, can be
double-spent, is not fault-tolerant, and (perhaps worst of all) is a fiat
currency without fixed supply. There could indeed be a superior alternative to
Bitcoin, just waiting to make the leap into the mainstream—but this is not it.

~~~
gravitronic
It's a new digital means to transfer canadian dollars. It's not a new
currency.

Pretty much everything after that java snippet is incorrect in your post.

~~~
evincarofautumn
I know it’s not a new currency. The post title reads “…a new alternative to
BitCoin”, which MintChip is not. It’s more like Google Wallet.

------
DanI-S
This is interesting, although the dependency on hardware seems to open a large
can of worms. Judging by the security overview[1], ensuring security of the
hardware will be a complex and ongoing task. Bitcoin's use of p2p here saves a
lot of fucking around, and cuts out a lot of middlemen.

I wish there were a middle ground - institutionally backed bitcoin. I suppose
there will be, once all the mining is done and ownership becomes consolidated.

[1][http://developer.mintchipchallenge.com/devguide/ecosystem.ht...](http://developer.mintchipchallenge.com/devguide/ecosystem.html)

~~~
AnthonyMouse
>I wish there were a middle ground - institutionally backed bitcoin.

You could realistically do something almost as good as that without any
reliance on either bitcoin or trusted computing, if you have a central
authority. It actually seems pretty simple: You create a website where people
can put in a credit card numbers and exchange money for secret (1000+ bit)
numbers. The server keeps track of how much money is associated with each
number. If you have a secret number, you can then go back and trade it back
for money, or you can (anonymously) trade it for a different secret number --
which permanently invalidates the old one and assigns its value to the new
one.

This way when you want to spend money, you just disclose a secret number worth
the value of the transaction in question to the payee, who immediately
exchanges it for a new number that the payer doesn't know, and is thereby the
only one who can subsequently trade it back in for government currency. (Of
course, in the common case they just re-spend it in the same way as digital
cash rather than redeeming it for government currency.) Make it so that you
can specify values (i.e. trade in a $5 number for a $4.50 number and a $.50
number) and you create a situation where anyone can sell anything and receive
a number as payment, and then buy something else and spend the number as
currency, all while neither of the other parties or the payment processor have
any idea who you are.

Add to this the availability of VPN accounts that assign all users to a single
public IP, so that users can route their SSL-encrypted transactions through an
IP shared by thousands of others who do the same and thereby prevent the
transaction processing server from associating transactions with IP addresses,
and you have digital anonymous cash.

The main disadvantage is that the secret numbers are exactly like cash, i.e.
if someone gets hold of them then they've stolen your money, it's gone, and
there is nothing you can do. But that's how cash works. And I kind of wish
someone would implement something like this -- I mean think about all the
money you could make just by holding the currency people pay you for the
numbers in low risk securities between when someone pays for one and when (if
ever) it eventually gets redeemed for government currency.

~~~
UnFleshedOne
UKash works like that. I don't know implementation details, but you get a
number that has some sum of money associated with it and you give that number
to the other party and they give you back a new number with change.

------
j45
Oh, Canada. Seeing stuff like this is exciting. Seems to be lining up along
side the alley of NFC.

------
javajosh
I have a theory, newly formed. And this seems the best place to share it,
because this motley collection of minds generally knows their stuff and won't
hesitate to tell me I'm wrong. :)

The only two meaningful categories of currency are "large" and "small". Large
currency is cash, coins. It can be manipulated with the hand, verified by the
eye. "Small currency" is expressed as microscopic state, and requires complex
tools to observe, verify, etc. Both bitcoin and mintchip are microscopic
currency. Computers function, then, first and foremost, as a kind of
microscope.

My theory is that small currency is only as secure as the microscope used. And
'microscopes' expressed on computers are themselves expressed 'in the small',
requiring other microscopes to verify, which can in turn be subverted. It's
subvertable microscopes all the way down.

What is the solution then? You need a cheap, 'trusted' microscope/small wallet
from a single source. It needs to be cheap so that it can be replaced
frequently (lost or stolen). It needs to be from a single source because if
trust is ever broken you need to get it from a different trusted source.

Also, it would be smart to limit the amount on a single device to being less
than or equal to the cost of physically defeating the device.

Mind you, the MintChip "microscope" is incomplete: it requires a host system
to do user interaction. Which, in my view, will always be the primary weakness
of any small currency. All you need to do is write a dummy program to fool a
user into believing they received the money, and you've won. And that's
trivially easy.

~~~
unimpressive
> _I have a theory, newly formed. And this seems the best place to share it,
> because this motley collection of minds generally knows their stuff and
> won't hesitate to tell me I'm wrong. :)_

That would be correct.

> _The only two meaningful categories of currency are "large" and "small".
> Large currency is cash, coins. It can be manipulated with the hand, verified
> by the eye. "Small currency" is expressed as microscopic state, and requires
> complex tools to observe, verify, etc. Both bitcoin and mintchip are
> microscopic currency. Computers function, then, first and foremost, as a
> kind of microscope._

What are you even saying? I saw where you were going and then you took a
swerve left at the last second. How does storing state in a microscopic state
turn a computer into a microscope? I assure you that no computer hardware
works by looking at stored state with a lens and using computer vision
algorithms to determine the state of the device.

> _My theory is that small currency is only as secure as the microscope used.
> And 'microscopes' expressed on computers are themselves expressed 'in the
> small', requiring other microscopes to verify, which can in turn be
> subverted. It's subvertable microscopes all the way down._

A pet peeve of mine is calling such guesses "theories" at this point the
proper term is "hypothesis". At any rate this is what cryptography is for. No
amount of "subversion" is going to break checksums and hashes. (In a way that
wouldn't set off serious red flags to users.) (Though turning them into a
usable monetary system is left as an exercise for the reader.)

> _What is the solution then? You need a cheap, 'trusted' microscope/small
> wallet from a single source. It needs to be cheap so that it can be replaced
> frequently (lost or stolen). It needs to be from a single source because if
> trust is ever broken you need to get it from a different trusted source._

It needs to _not_ be from a single source you mean? If not then that sentence
makes no sense. As it turns out; hardware bugs are actually harder to find
than software ones. It would be better to use general hardware if only because
you'd be less likely to find an intentional Trojan horse for bit-coin or
similar in it.

> _Also, it would be smart to limit the amount on a single device to being
> less than or equal to the cost of physically defeating the device._

So about the cost of a 5$ walmart screwdriver? A 50$ Blowtorch? It would end
up being too low and you know it. It'd be better to just do an arbitrary limit
like 500$ and call it done.

> _Mind you, the MintChip "microscope" is incomplete: it requires a host
> system to do user interaction. Which, in my view, will always be the primary
> weakness of any small currency. All you need to do is write a dummy program
> to fool a user into believing they received the money, and you've won. And
> that's trivially easy._

Man in the middle attacks were something that certificates were _supposed_ to
solve; but didn't.

It'll be interesting to see how this all plays out.

~~~
javajosh
_> How does storing state in a microscopic state turn a computer into a
microscope? I assure you that no computer hardware works by looking at stored
state with a lens and using computer vision algorithms to determine the state
of the device._

Oh sorry. It's a somewhat strange concept I admit, but it's served me well.
There are a couple of ways to motivate it. Let us say that a computer has 4G
of memory (roughly 10^10 bits). That is a vast amount of data. If that were to
be printed out into a sheet of paper, with each bit a dot about what the naked
human eye can see (call it .1 mm square) then it would be a sheet about 10
square meters (10^5 * 10^-4m = 10m^2).

The actual size of a 4G RAM chip is more like 1mm^2. This is a reduction
factor of 10,000.

Let us say that a physical screen operates at the density of our original
printout . This implies that the software sitting between the display and main
memory is essentially functioning as a microscope, making visible to the naked
eye a sheet of paper that is 10,000x smaller than we can see.

But if we consider _information_ rather than data, the magnification is an
order-of-magnitude higher, at least. (A screenful of characters 10px on each
side requires 100bits, whereas the codepoint takes around 8bits.) And of
course if we consider hard-drives rather than main memory, realize that a TB
is roughly 1000x main memory, or 1000 sheets of paper, each 10 meters square
(about 310 square meters).

~~~
unimpressive
>Oh sorry. It's a somewhat strange concept I admit, but it's served me
well...(What follows is a brilliant analogy where I was expecting total
insanity.)

You know. I think I'm going to use that in the future. Thanks.

~~~
javajosh
_> (What follows is a brilliant analogy where I was expecting total insanity.)
You know. I think I'm going to use that in the future. Thanks._

Thanks! I hope you can revisit what I said in the grandparent post with this
in mind. :)

------
sull
Good timing for this type of official initiative. Makes me wonder if this
could lead to a Consortium of World Mints to share the same vision and cost
and arrange a trusted network of Backers and Brokers. Or if this will be the
new Space Race with countries competing on the tech and implementation and
quality of network participants etc. Could be a mess like many standards based
efforts. Then there is the issue of the patents that RCM has and how that
plays into the global evolution of this effort. It may end up just being a
Canadian solution for Canadian Currency.

Though BitCoin is related, I don't see a a reason to inject it into this
particular thread. BitCoin is its own beast with different goals... in fact...
opposite goals (while using some similar technologies). BitCoin is happy as
the backbone of an edge economy and not a competing system with centralised
solutions like MintChip (which has decentralised aspects as well but not the
core foundation).

------
unabridged
They didn't create an alternative, they just built the "last mile" for Bitcoin
usage. A government backed anonymous currency that will most likely be
accepted throughout canada and hopefully the world, that can be freely
exchanged with bitcoin in a short amount of time. Anyone will be able to build
an exchange.

MintChip = checking account, Bitcoin = savings account

------
codesuela
Maybe it's just me but I feel that a Royal (Canadian) crypto-currency won't
find widespread adoption among cyberpunks.

~~~
nas
I don't think it will but perhaps not for the reason you apparently think. The
details are scarce but the crypto doesn't look interesting. The idea of
trusted hardware has been around for a long time. I think most cyberpunks
don't trust it, probably for good reason. BTW, looks like they use SHA-1.
Really? In 2012 you design a system and use SHA-1?

------
lbotos
So they want people to build apps using mintchips? Essentially
Stripe/Paypal/Dwolla using this tech? I'm kind of confused by this.

The only differentiating factor here is the currency is "mintchips". How much
more creative can you get with a checkout when we are only changing the
"backing" of the numbers that are moving around?

~~~
Foy
I was concerned when they mentioned a criteria for judgment was originality of
the idea... What can be done with online transactions that hasn't already been
done?

I suppose an app that allowed offline transactions would fit that bill, the
only problem being that your app would be offline.

------
charlieok
Why must the article use this headline when the article explicitly says that
it isn't actually anything like Bitcoin:

“Bitcoin offers currency from a decentralized source, whereas RCM's solution
is from a centralized authority.”

------
el_presidente
From:
[http://developer.mintchipchallenge.com/devguide/evolution.ht...](http://developer.mintchipchallenge.com/devguide/evolution.html)

 _Unburdened by the need for a proprietary network, MintChip offers a cost
effective solution to consumers and merchants and enables easy person-to-
person payments._

So, it looks like, this is the government's attempt to compete with Interac.
The site claims it's a replacement for cash, but the last time I used cash was
maybe two weeks ago to pay for a coffee. And I know some people who use a
prepaid card to buy coffee.

------
wcoenen
Somebody submitted a patent application[1] about a year ago in Europe for a
very similar system called fairCASH[2]

[1]
[http://faircash.org/fileadmin/dateien/fairCASH_Patent_Applic...](http://faircash.org/fileadmin/dateien/fairCASH_Patent_Application.pdf)

[2] <http://faircash.org/>

------
rdl
I don't see any point behind an offline electronic cash system; they barely
made sense in the 1990s, and once there was ubiquitous Internet, made even
less sense.

They only make sense for transit (or other one-way systems, not peer to peer),
and there, providing Internet at the point of sale is easy.

------
wcoenen
One of the judges for the "challenge" is David Birch. He recently spoke at a
Bitcoin conference: [http://bitcoinmedia.com/eurobit-david-birch-next-
generation-...](http://bitcoinmedia.com/eurobit-david-birch-next-generation-
money/)

------
npollock
Are there any details on how the supply of this new currency is going to be
controlled? I'm all for innovation in payments and currency, but isn't there
the same risk as with all fiat money - that a central body can debase the
currency at will?

~~~
sgornick
It isn't a new currency, I don't think. Looks like balances and transactions
will be CADs, USDs, EURs, etc.,

If the issuer claims to have backing for the currency then for each CAD issued
on a MintChip there would be a CAD in a bank somewhere. Same for USDs.

Since the mint can buy BTCs to issue as well, no reason MintChips can't be
used for Bitcoin commerce as well.

[http://developer.mintchipchallenge.com/api/java/ca/mint/mint...](http://developer.mintchipchallenge.com/api/java/ca/mint/mintchip/contract/CurrencyCode.html#CurrencyCode\(int\))

------
adrianwaj
Why don't they just create a new bitcoin blockchain and have every new
'goldbit' bitcoin backed by a physical gold coin? Someone should do this. So
somewhere is vault filled with gold coins that people have used to buy their
goldbits.

------
ChristianMarks
[Loose] change is good, this is better. Apparently, pennies weren't good
enough for the Royal Canadian Mint either. Incidentally, after the crash of
2008, Joseph Stiglitz wrote that "change ... has no inherent value."

------
jerf
It's interesting and I think there's tantalizing hints in there that they may
have learned from BitCoin, but there doesn't seem to be enough detail in there
to analyze it. Anyone know of some?

~~~
wmf
It sounds more like a clone of Mondex from the 90s.
<http://www.wired.com/wired/archive/2.08/eword.html>

~~~
andrewcooke
agreed. my second job in the industry was writing a complete (back + front-
end) system for mondex (and beenz...).

[google] this was us! [http://www.mail-
archive.com/cryptography@c2.net/msg00993.htm...](http://www.mail-
archive.com/cryptography@c2.net/msg00993.html)

------
tokenizer
Does anyone know what they mean in the Javascript API docs when they mention
that it's only supported by Microsoft Windows with Microsoft .NET Framework
2.0 or higher?

------
bdg
I could never put my trust into an entire online currency if it wasn't open-
source. Does anyone else worry about this as well?

------
Khao
<http://mintchipchallenge.com/index.php>

The 404 page is horrifying.

~~~
jeffreylo
It's the standard ChallengePost 404 page. What's wrong with it?

~~~
Khao
Finding a website about The Royal Canadian Mint that has a crappy unicorn made
with Paint as its 404 page makes it look like a huge hoax.

~~~
untog
It's a web site _about_ the Mint, not a web site _by_ the Mint.

------
newman314
Cash is anonymous. For any digital equivalent, I think this would be a key
requirement to have.

------
jonny_eh
The most confusing part of the site is that it's not clear how they turn goats
into MintChips.

~~~
msgr1
Back in the day people used goats for currency. Then wheat, coins, etc. Simple
timeline.

------
kruhft
I wonder if it has Linux support. If not, that's my submission to the
competition.

------
SagelyGuru
Any scheme that makes it easier to further inflate the money supply(=debt),
especially one like this that avoids even the minimal inconvenience of
printing cash, is sure to be welcomed and promoted by the banksters.

------
Canada
License fail. Read it. It's ridiculous.

------
pyre

      MintChip value can be stored and moved quickly and
      easily [...] by physically tapping devices together
    

Ugh.

------
jaysonelliot
tl;dr please - is it anonymous?

~~~
meta
I don't think so, obscure but not anonymous.

Here:
[http://developer.mintchipchallenge.com/devguide/developing/c...](http://developer.mintchipchallenge.com/devguide/developing/common/mintchip-
messages.html)

Each transfer message has both the Sender and Receiver encoded within it.
These are opaque but generated by your mintchip provider.

Looking here:
[http://developer.mintchipchallenge.com/devguide/ecosystem.ht...](http://developer.mintchipchallenge.com/devguide/ecosystem.html)

Suggests that your provider ("trusted broker") creates your mintchip ids. It
might be possible to associate many keys to your physical person but I believe
all of them could be traced back with the co-operation of the providers.

------
caycep
the EVE online denizens are going to have a field day w/ this...

------
brunoqc
Why not use BitCoin?

~~~
nateberkopec
BitCoin's fluctuating popularity has made it's value extremely unstable,
making it unsuitable for use as money. Money has to be a stable unit of
account as well as a predictable store of value, characteristics BitCoin
doesn't have.

Basically, BitCoin for the time being is an interesting asset/investment, but
not a very good cash replacement.

~~~
amouat
The best current use case is _transferring money_. Assuming bitcoin is
relatively stable hour to hour (which I think it is) and both sender and
receiver have access to an exchange that will convert bitcoins to their local
currency, it can be effectively used to avoid large bank charges.

As long as the sender converts their money just prior to paying and the
receiver converts back to local currency soon afterwards, there should be no
problems.

I guess the big assumption here is both parties have access to a reliable
exchange that can easily handle the volume of currency being transferred.

~~~
wmf
So you've just replaced traditional fees with _two_ exchange fees.

~~~
cwkoss
But with each exchange fee only 0.65% (MtGox's highest rate), 1.3% is
competitive with many other transfer methods.

~~~
wmf
Now add the fee to get money into the exchange and another fee to get money
out.

~~~
Jackten
$0.25 per transaction using dwolla. Roughly $5 to use SEPA. or worst case $15
bank transfer.

Compare that to the fees charged by Western Union or Money Bookers or credit
card companies.. You're looking at $30 minimum + 6%-12%

------
noduerme
As tech founder / owner of a Bitcoin casino, <https://StrikeSapphire.com>, I
think this is great. If it's real. And if the Royal Mint doesn't stick their
nose into how we change cash. And if our users can remain more-or-less
anonymous, and transactions can stay free, and we can change it out without
paying a rake to the Canadian government, and there's no risk of double-
spending or chargeback or backdoors in the client that let one government or
another come in and raid your funds when it suits their interests.

Nothing on their website gives me confidence that any of those issues have
been addressed, or will be. And in truth, the idea that a national government
would open up an unmonitored currency for System-D sounds just-William-Gibson-
enough to be plausible, and just too Neal Stephenson to not deserve a rimshot.

What's a lot more likely is that this is a big-ass trojan horse for the media
to make sweet love to for the next few months while castigating Bitcoin for
supposed flaws, and eventually deeming it "unsafe", followed by "illegal", for
the general population. It's a PR stunt to compete with BTC in the eyes of a
non-technical public. And it'll probably work - for a non-technical public.

But the flaws in a system like this will likely become apparent much more
quickly than, say, the flaws in the Federal Reserve system did. Nothing with a
backdoor, closed code or centralized "trusted distributors" stays safe for
long these days. I really had to laugh when I saw their nifty graphic over
here:
[http://developer.mintchipchallenge.com/devguide/ecosystem.ht...](http://developer.mintchipchallenge.com/devguide/ecosystem.html)

But we're not biased. Hell, we'll start accepting the junk if it's as good as
they say. Let the best currency win.

------
naughtysriram
I would just use cash.

------
marnysmith
Accept the challenge! <http://mintchipchallenge.com/>

