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Re: How can e-cash, even on-line cleared, protect payee identity?

12 expanded posts ยท every known parent and child

NODE bccf288bRe: How can e-cash, even on-line cleared, protect payee identity?
At 11:20 PM 10/22/95, Bryce wrote:

>I can imagine a future in which this requirement is not difficult to
>meet.  Perhaps it will be the case that you can accept a coin, open
>up a new ("anonymous") account with the bank, deposit the coin,
>withdraw a new coin of the same amount, close the account, and now
>have an untraceable coin all in a fraction of a second.

Bryce, we'll make you a believer in online clearing yet!

This is essentially the point several of us have been making, that if
"anonymous bank accounts" are allowed (_technically_, no problem), then Bob
can take his "possibly watched" piece of cash, deposit it with his bank in
his anonymous account, withdraw the same amount (or more, or less, it
doesn't matter if the account is truly anonymous) and neither Alice nor the
Bank know who got it.

As you note, Bob can even open a new account, deposit, withdraw, close the
account. This makes the bank a "digital coin laundry," such as Lucky Greene
and others have talked about.

If forbidden by law in the U.S., no problem using offshore banks.

--Tim May


Views here are not the views of my Internet Service Provider or Government.
---------:---------:---------:---------:---------:---------:---------:----
Timothy C. May              | Crypto Anarchy: encryption, digital money,
tcmay@got.net  408-728-0152 | anonymous networks, digital pseudonyms, zero
Corralitos, CA              | knowledge, reputations, information markets,
Higher Power: 2^756839      | black markets, collapse of governments.
"National borders are just speed bumps on the information superhighway."
NODE c7425576Re: How can e-cash, even on-line cleared, protect payee identity?
-----BEGIN PGP SIGNED MESSAGE-----

 I, Bryce <bryce@colorado.edu> wrote:
> 
> I can imagine a future in which this requirement is not difficult to
> meet.  Perhaps it will be the case that you can accept a coin, open
> up a new ("anonymous") account with the bank, deposit the coin,
> withdraw a new coin of the same amount, close the account, and now
> have an untraceable coin all in a fraction of a second.


 the entity calling itself TC May <tcmay@got.net> allegedly wrote:
> 
> This is essentially the point several of us have been making, that if
> "anonymous bank accounts" are allowed (_technically_, no problem), then Bob
> can take his "possibly watched" piece of cash, deposit it with his bank in
> his anonymous account, withdraw the same amount (or more, or less, it
> doesn't matter if the account is truly anonymous) and neither Alice nor the
> Bank know who got it.


Now it seems to me that any ecash scheme, whether cleared on-line or
off-line, with or without double-spending-detection, will put the
payee at risk of identification by a collusion of the payer and the
bank.  As far as I can tell, Chaum's off-line,
double-spending-detecting DigiCash Ecash is no more or less
susceptible to this attack than is any other scheme.  (This is
because the e-coin must have a unique ID or serial number, and the
payer/bank collusion can trace the passage of that serial number to
identify the payee.)


TC May has stated that Chaum's off-line strategy enables
payee-identification by a payer/bank collusion, but it seems to me 
that this is incorrect, because payee-identification is *always*
possible by a payer/bank collusion under any scheme.


 ""TC May"":
> As you note, Bob can even open a new account, deposit, withdraw, close the
> account. This makes the bank a "digital coin laundry," such as Lucky Greene
> and others have talked about.


Right, if the bank allows anon accounts and/or accounts that can be
created and used with very little time/effort/expense.  Now if the
bank doesn't allow that then you could have a chain of
money-laudering "remailer" type services.  They will deposit the
coin for you and withdraw a new one, thus making it untraceable
*unless* they themselves are in on the collusion.


Perhaps you "chained remailer" people can apply your expertise to this
and invent for us a method of laundering your e-coin through a chain
of such services, making sure that a collusion of payer, bank and
*all* launderers is necessary to reveal your identity, and making
sure that the launderers themselves can't steal your coin.


Sounds impossible at first blush.


Regards,

Bryce

signatures follow


            "To strive, to seek, to find and not to yield."   
    <a href="http://ugrad-www.cs.colorado.edu/~wilcoxb/Niche.html">

                          bryce@colorado.edu                   </a>



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NODE a7354a6bRe: How can e-cash, even on-line cleared, protect payee identity?
On Sun, 22 Oct 1995, Bryce wrote:

> Now it seems to me that any ecash scheme, whether cleared on-line or
> off-line, with or without double-spending-detection, will put the
> payee at risk of identification by a collusion of the payer and the

I can't remember off hand, but isn't blinding transitive? If so, there's 
an obvious way to get two way anonymity with an on-line system. If Alice 
wants to pay Bob $10, then Bob could prepare the usual squillion copies 
of the note, each with a serial number known only to Bob, then blind them 
and send them to Alice. 

Alice would then reblind them and send them to Nick, the banker. Nick
would then pick one of the notes, and ask Alice for the blinders for the
rest. Alice would then ask Bob for his blinders for the rejected notes,
and would forward both sets on to Nick, who would check them, and if
they're legit, sign the remaning copy, and return it to Alice.  

Alice cound then remove her blinding factor, and sent the result on to
Bob. Bob then removes his blinding factor, and can now spend the coin. 

Since Alice doesn't know the serial number, she can't reveal it to Nick 
so that he can find out who deposits the coin. Also, since Nick doesn't 
know the serial number, he can't collaborate with Bob to find out who 
Alice is. 

Does this work, or am I missing something?

Simon

---
(defun modexpt (x y n)  "computes (x^y) mod n"
  (cond ((= y 0) 1) 	((= y 1) (mod x n))
	((evenp y) (mod (expt (modexpt x (/ y 2) n) 2) n))
	(t (mod (* x (modexpt x (1- y) n)) n))))
NODE e41e7d86Re: How can e-cash, even on-line cleared, protect payee identity?
-----BEGIN PGP SIGNED MESSAGE-----

 An entity calling itself "Simon Spero" <ses@tipper.oit.unc.edu> 
 allegedly wrote:
>
> I can't remember off hand, but isn't blinding transitive?


Blinding and unblinding is just multiplication and division in
modular arithmetic, right?  So it oughta be transitive, right?
I actually don't know, and I am eager to find out.


 "'Simon Spero'":
>
> If so, there's 
> an obvious way to get two way anonymity with an on-line system. If Alice 
> wants to pay Bob $10, then Bob could prepare the usual squillion copies 
> of the note, each with a serial number known only to Bob, then blind them 
> and send them to Alice. 
> 
> Alice would then reblind them and send them to Nick, the banker. Nick
> would then pick one of the notes, and ask Alice for the blinders for the
> rest. Alice would then ask Bob for his blinders for the rejected notes,
> and would forward both sets on to Nick, who would check them, and if
> they're legit, sign the remaning copy, and return it to Alice.  
> Alice cound then remove her blinding factor, and sent the result on to
> Bob. Bob then removes his blinding factor, and can now spend the coin. 


You mean he can now deposit the note with the bank for credit?  
Although he won't actually deposit it until later, some random 
amount of time after this transaction is finished.
  He *could* give the note to Charles, who would deposit it, but
Charles would not be able to protect his own identity when
accepting it.  Bob might as well just turn it in to the bank.


 "'Simon Spero'":
>
> Since Alice doesn't know the serial number, she can't reveal it to Nick 
> so that he can find out who deposits the coin. Also, since Nick doesn't 
> know the serial number, he can't collaborate with Bob to find out who 
> Alice is. 
> 
> Does this work, or am I missing something?


It sounds good to me.  Bob will check the note for the bank's sig
after he has unblinded it.  Thus he knows that Alice didn't cheat
him.


Can a more astute mathematician than myself evaluate this scheme for
us?


Bryce

signatures follow


            "To strive, to seek, to find and not to yield."   
    <a href="http://ugrad-www.cs.colorado.edu/~wilcoxb/Niche.html">

                          bryce@colorado.edu                   </a>



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NODE ed2126ecRe: How can e-cash, even on-line cleared, protect payee identity?
"Simon Spero" <ses@tipper.oit.unc.edu>  wrote:
>> If so, there's 
>> an obvious way to get two way anonymity with an on-line system. If Alice 
>> wants to pay Bob $10, then Bob could prepare the usual squillion copies 
>> of the note, each with a serial number known only to Bob, then blind them 
>> and send them to Alice. 
>> 
>> Alice would then reblind them and send them to Nick, the banker. Nick
>> would then pick one of the notes, and ask Alice for the blinders for the
>> rest. Alice would then ask Bob for his blinders for the rejected notes,
>> and would forward both sets on to Nick, who would check them, and if
>> they're legit, sign the remaning copy, and return it to Alice.  
>> Alice cound then remove her blinding factor, and sent the result on to
>> Bob. Bob then removes his blinding factor, and can now spend the coin. 

This is an interesting idea but it is more complicated than necessary, I
think.  The denomination can be carried in the exponent, in which case
there is no need for cut and choose and nobody can cheat the bank.  A
coin suitable for deposit is a signed number of some special form.  To
pay Bob, Alice does not withdraw anything ahead of time.  Rather, Bob
gives her a blinded coin, which she reblinds and gives to the bank.  The
bank signs it (debiting Alice's account) and gives it back to her.  She
strips off her blinding and gives it to Bob.  He strips off his own
blinding and verfifies that he is left with a signed number of the
appropriate form.

This system is in some ways the inverse of regular ecash.  Instead of
Alice withdrawing a coin ahead of time, and Bob checking it with the bank
right away, it is Alice who does the bank interaction at payment time,
and Bob who waits before interacting with the bank.  The computational
and communications costs do not seem much worse than ecash.

There is no way Alice can double-spend because she cannot anticipate
Bob's blinding factor and give him a previously-spent coin which will
unblind to the proper form.  There could be an issue of fraud, though,
where Bob insists that Alice's coin was no good even though it actually
was.  Since he has blinded it she will have no way of recognizing it when
he eventually deposits it.  In the current system this does not arise as
Alice can always give him another copy of the coin and prove that it is
good, and she can further determine if Bob has deposited it.  So some of
the trust in the bank necessary with regular ecash gets replaced by trust
between payee and payor in Simon Spero's system.

Still, I think this scheme has considerable merit and is worth exploring
further.  It seems to provide superior privacy protection over Chaum's
ecash.  The fraud issue can perhaps be dealt with by reputations and
credentials as we have often discussed.

Hal
NODE f376061bRe: How can e-cash, even on-line cleared, protect payee identity?
-----BEGIN PGP SIGNED MESSAGE-----

Hello Hal <hfinney@shell.portal.com>
  and cypherpunks@toad.com

H wrote:
> "Simon Spero" <ses@tipper.oit.unc.edu>  wrote:

[about fully-anon ecash]
 
...
> There could be an issue of fraud, though,
> where Bob insists that Alice's coin was no good even though it actually
> was.
...

Cut'n'choose between Alice and Bob? Ie Alice asks Bob for half the blinds
to check that the proto-coins are true?

Apart from no-good proto-coins, is there any other way the coin
could be no good?

As for no-good proto-coins, it's Bob's fault, isn't it? Alice has 
a record of what Bob sent, and what she sent back. Anybody can check
that the latter is a bank-signed version of the former. Given this,
there's no need (from this) for Alice to know that the proto-coins are
good (if they aren't, Bob's an idiot, but there's not much Alice
can do about it - I guess given all the blinding factors the bank
could replace the coin, seeing that it signed a worthless one).

So Bob can't really fraud - unless I've missed something.


An interesting question is whether Bob and Nick can now collude to
expose Alice. Therefore Alice would at least want to verify that the
proto-coins are true? Would that suffice? Or is that not necessary?

> Still, I think this scheme has considerable merit and is worth exploring
...

Certainly.


Jiri
- --
If you want an answer, please mail to <jirib@cs.monash.edu.au>.
On sweeney, I may delete without reading!
PGP 463A14D5 (but it's at home so it'll take a day or two)
PGP EF0607F9 (but it's at uni so don't rely on it too much)

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NODE 564793d3Re: How can e-cash, even on-line cleared, protect payee identity?
Jiri Baum <jirib@sweeney.cs.monash.edu.au> writes:
>Hello Hal <hfinney@shell.portal.com>
>H wrote:
>> There could be an issue of fraud, though,
>> where Bob insists that Alice's coin was no good even though it actually
>> was.

>Cut'n'choose between Alice and Bob? Ie Alice asks Bob for half the blinds
>to check that the proto-coins are true?

This would work to protect Alice from certain kinds of fraud by Bob, but
it increases the amount of data considerably, and it still does not
resolve the main issue that Bob claims that his coin didn't unlind to
clean data.  Who is at fault in that case?  How can this be resolved?

>Apart from no-good proto-coins, is there any other way the coin
>could be no good?

Alice could give Bob bogus data, Bob could give Alice bogus data, Bob
could claim that Alice gave him bogus data (even though it was good).

>As for no-good proto-coins, it's Bob's fault, isn't it? Alice has 
>a record of what Bob sent, and what she sent back. Anybody can check
>that the latter is a bank-signed version of the former.

If what she got from Bob was signed by him, she can prove that she gave him
back a bank-signed version of that.  (He has to sign it, otherwise she
could just exhibit two bogus numbers, one the cube of the other.)  Given
that, your idea seems good.  Alice can prove that she did her part OK, so
if she is able to show such a proof then Bob must be at fault.

>Given this,
>there's no need (from this) for Alice to know that the proto-coins are
>good (if they aren't, Bob's an idiot, but there's not much Alice
>can do about it - I guess given all the blinding factors the bank
>could replace the coin, seeing that it signed a worthless one).

Yes, I think so, so there is no need for the cut and choose.

>An interesting question is whether Bob and Nick can now collude to
>expose Alice. Therefore Alice would at least want to verify that the
>proto-coins are true? Would that suffice? Or is that not necessary?

I don't think they can.  All Bob sees is his own blinded coin, and the
signed version of that.  The bank sees a separately blinded number which
it signed.  Alice's blinding factor can be anything, so there is no
linkage between them.

However, the timing is a problem.  Bob knows _when_ Alice communicated
with the bank.  So he can collude with the bank afterwards to identify
those withdrawals which took place at that time, one of which must have
been Alice.  This could be a problem.

In regular ecash, the timing issue is potentially less serious because
the payee can in principle have a totally anonymous relationship to the
bank, and exchange his received coins for fresh ones.  But in this
system doing that is more difficult.  Alice must withdraw funds rather
than deposit them.  To do so totally anonymously she would have to
present coins to the bank at withdrawal time equal in value to the
amount she wanted to pay Bob.  The bank would replace these coins with
fresh ones that it signs, which are the doubly-blinded ones which Bob
has provided to Alice.  So this is a somewhat more roundabout
approach.  However, if you do this, and Alice communicates with the
bank anonymously, then both sides seem to be pretty well protected
against collusion.

Hal
NODE 8c8da5e3Re: How can e-cash, even on-line cleared, protect payee identity?
-----BEGIN PGP SIGNED MESSAGE-----

Hello Hal <hfinney@shell.portal.com>
  and cypherpunks@toad.com

H wrote:
> Jiri Baum <jirib@sweeney.cs.monash.edu.au> writes:
...
> >An interesting question is whether Bob and Nick can now collude to
> >expose Alice. Therefore Alice would at least want to verify that the
...
> 
> I don't think they can.  All Bob sees is his own blinded coin, and the
...

What I meant is, are there any proto-coins that will show through
a blinding? (Mathematically special values like fixed points.)

> However, the timing is a problem.  Bob knows _when_ Alice communicated
...

So it is.

What you'd really want is for Alice to pay for the new coins in ecash.


I'm wondering whether a "coin-changer" would be easier or harder to
set up than a "bank" (from regulatory point of view).

After all, for e-cash you don't really need accounts; you just need:
  - verify coins (coin-changer) ie ecash->ecash
  - buy coins (join the system) ie  cash->ecash
  - sell coins (redeem)         ie ecash->cash

Any cyberspace banks can be completely separate from the ecash issuer.


Jiri
- --
If you want an answer, please mail to <jirib@cs.monash.edu.au>.
On sweeney, I may delete without reading!
PGP 463A14D5 (but it's at home so it'll take a day or two)
PGP EF0607F9 (but it's at uni so don't rely on it too much)

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NODE 01089afaRe: How can e-cash, even on-line cleared, protect payee identity?
On Mon, 23 Oct 1995, Hal wrote:

> This is an interesting idea but it is more complicated than necessary, I
> think.  The denomination can be carried in the exponent, in which case
> there is no need for cut and choose and nobody can cheat the bank.  A
> coin suitable for deposit is a signed number of some special form.  To
> pay Bob, Alice does not withdraw anything ahead of time.  Rather, Bob
> gives her a blinded coin, which she reblinds and gives to the bank.  The
> bank signs it (debiting Alice's account) and gives it back to her.  She
> strips off her blinding and gives it to Bob.  He strips off his own
> blinding and verfifies that he is left with a signed number of the
> appropriate form.

Using the above protocol, payee anonymity will not be compromised by 
collusion between the bank and the payer, but the payee and the bank can 
collude to identify the payer!  (This reverses the situation in normal 
Chaumian ecash, and of course in certain circumstances may be preferable.)

This collusion can succeed even if Alice (the payer) reblinds the coin 
she gets from Bob before asking the bank to sign it, because Alice must 
withdraw the coin after Bob gives it to her and before returning it to Bob.  
Bob can ask the bank to record the names of everyone who withdrew money 
during that period, and after two or three repeated transactions can 
narrow the list of possible payers down to one person.  (This is reminescent 
of the time-correlation attack on remailers.)  In the original protocol 
this isn't possible because Alice can withdraw the money ahead of time.

Wei Dai
NODE 4065b6fbRe: How can e-cash, even on-line cleared, protect payee identity?
In article <DGxFBL.753@sgi.sgi.com>, Hal <hfinney@shell.portal.com> writes:

> "Simon Spero" <ses@tipper.oit.unc.edu>  wrote:
>>> If so, there's 
>>> an obvious way to get two way anonymity with an on-line system. If Alice 
>>> wants to pay Bob $10, then Bob could prepare the usual squillion copies 
>>> of the note, each with a serial number known only to Bob, then blind them 
>>> and send them to Alice. 
>>> 
>>> Alice would then reblind them and send them to Nick, the banker. Nick
>>> would then pick one of the notes, and ask Alice for the blinders for the
>>> rest. Alice would then ask Bob for his blinders for the rejected notes,
>>> and would forward both sets on to Nick, who would check them, and if
>>> they're legit, sign the remaning copy, and return it to Alice.  
>>> Alice cound then remove her blinding factor, and sent the result on to
>>> Bob. Bob then removes his blinding factor, and can now spend the coin. 

> This is an interesting idea but it is more complicated than necessary, I
> think.  The denomination can be carried in the exponent, in which case
> there is no need for cut and choose and nobody can cheat the bank.  A
> coin suitable for deposit is a signed number of some special form.  To
> pay Bob, Alice does not withdraw anything ahead of time.  Rather, Bob
> gives her a blinded coin, which she reblinds and gives to the bank.  The
> bank signs it (debiting Alice's account) and gives it back to her.  She
> strips off her blinding and gives it to Bob.  He strips off his own
> blinding and verfifies that he is left with a signed number of the
> appropriate form.

> This system is in some ways the inverse of regular ecash.  Instead of
> Alice withdrawing a coin ahead of time, and Bob checking it with the bank
> right away, it is Alice who does the bank interaction at payment time,
> and Bob who waits before interacting with the bank.  The computational
> and communications costs do not seem much worse than ecash.

> There is no way Alice can double-spend because she cannot anticipate
> Bob's blinding factor and give him a previously-spent coin which will
> unblind to the proper form.  There could be an issue of fraud, though,
> where Bob insists that Alice's coin was no good even though it actually
> was.  Since he has blinded it she will have no way of recognizing it when
> he eventually deposits it.  In the current system this does not arise as
> Alice can always give him another copy of the coin and prove that it is
> good, and she can further determine if Bob has deposited it.  So some of
> the trust in the bank necessary with regular ecash gets replaced by trust
> between payee and payor in Simon Spero's system.

If Bob insists that the bank wouldn't redeem Alice's coin, that's not
Alice's fault.  The bank should have reserved the money when Alice
withdrew it.  Since nobody other than Bob sees the unblinded coin, it's
Bob's fault if somebody else spent it before Bob could.  In the case of
fraud by the bank, since the bank signed the coin, the bank should be
liable if it won't redeem it.

Perhaps the problem is that Bob insists that Alice's coin was not signed
by the bank.  In that case, how about this modification?  Alice should
first show Bob the doubly blinded coin she gave to the bank and the
signed doubly blinded coin she received back.  Bob can verify the
signature and then Alice can give him the blinding factor so he can
unblind it himself.  Bob also needs to sign the singly blinded coin that
he gives to Alice so that Alice can later show that she gave him the
correct blinding factor if Bob tries to claim that she didn't.

Are the any problems with this?

-- 
Sure we spend a lot of money, but that doesn't mean | Tom Weinstein
we *do* anything.  --  Washington DC motto          | tomw@engr.sgi.com
NODE ee8a926bRe: How can e-cash, even on-line cleared, protect payee identity?
tomw@orac.engr.sgi.com (Tom Weinstein) writes:

>Perhaps the problem is that Bob insists that Alice's coin was not signed
>by the bank.  In that case, how about this modification?  Alice should
>first show Bob the doubly blinded coin she gave to the bank and the
>signed doubly blinded coin she received back.  Bob can verify the
>signature and then Alice can give him the blinding factor so he can
>unblind it himself.  Bob also needs to sign the singly blinded coin that
>he gives to Alice so that Alice can later show that she gave him the
>correct blinding factor if Bob tries to claim that she didn't.

The problem with this is that Bob and the bank can now collude to trace
Alice, since he sees what she sent to the bank.  This is not as bad as in
the forward traceability case of regular ecash, because it happens after
Alice has completed her bank transaction, rather than before, but it
would be better to be untraceable since that is the whole point of this
variation.

Hal
NODE 22b68d45Re: How can e-cash, even on-line cleared, protect payee identity?
In article <DGyIMI.KM9@sgi.sgi.com>, Hal <hfinney@shell.portal.com> writes:

> tomw@orac.engr.sgi.com (Tom Weinstein) writes:
>> Perhaps the problem is that Bob insists that Alice's coin was not signed
>> by the bank.  In that case, how about this modification?  Alice should
>> first show Bob the doubly blinded coin she gave to the bank and the
>> signed doubly blinded coin she received back.  Bob can verify the
>> signature and then Alice can give him the blinding factor so he can
>> unblind it himself.  Bob also needs to sign the singly blinded coin that
>> he gives to Alice so that Alice can later show that she gave him the
>> correct blinding factor if Bob tries to claim that she didn't.

> The problem with this is that Bob and the bank can now collude to trace
> Alice, since he sees what she sent to the bank.  This is not as bad as in
> the forward traceability case of regular ecash, because it happens after
> Alice has completed her bank transaction, rather than before, but it
> would be better to be untraceable since that is the whole point of this
> variation.

Good point.  To guard against this, Alice needs to double blind what she
sends to the bank.  She can then remove one layer of blinding and show
the results to Bob.  Of course Bob and the bank can still colude because
of the timing of the transactions.  This seems to be a fundamental
weakness of this reverse e-cash scheme.

-- 
Sure we spend a lot of money, but that doesn't mean | Tom Weinstein
we *do* anything.  --  Washington DC motto          | tomw@engr.sgi.com