Physical cash is dying–and you don't need to be a conspiracist to worry • Hacker News Board

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#361

Post by sneak » Sat, Feb 03, 2024, 4:46 PM UTC

coppsilgold wrote: post #358

It's technologically feasible to create centralized digital cash that is much more anonymous than physical cash. You can do it by using zero knowledge proofs where you have vouchers & nullifiers. It's virtually the same idea that powers Tornado Cash. It's tractable but challenging, every single transfer of a digital-cash note would necessitate an entry into a public Merkle-tree. You could mitigate this by introducing…

Governments did everything they could to stop Tornado Cash.

Uncensorable, anonymous digital payments is the very last thing the state wants for its citizens. That allows private people to raise (and pay for) an army.

Preventing rival armies within their territory is the primary and most important function of a state.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#362

Post by yyyk » Sat, Feb 03, 2024, 4:52 PM UTC

nonrandomstring wrote: post #278

yyyk wrote: post #186

Earlier quoted context omitted.

>how much the police can do to trace cash It doable but not at all trivial. >It's well past the point of being worth forging The news seem to indicate plenty of forgers still, e.g.: https://www.europol.europa.eu/media-press/newsroom/news/poss... >it is likely that future banknotes will use einks einks are too expensive right now?

> einks are too expensive right now? Maybe yes. But track their falling cost and you'll see where the price point intersects with near disposable cost. European transport tickets made of cheap plasticised card only took a couple of years to incorporate RFID - that's already a long way toward low cost "intelligent cash". For a brief few weeks in the 1980s we had "phone cards" with stored, decrementable value that you…

>track their falling cost

I do recall that patents/trademarks/tech are owned by E-Ink inc., and one of the biggest reason for the cost is them gouging the market? That mechanism can keep high prices for a long time.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#363

Post by kuchenbecker » Sat, Feb 03, 2024, 4:53 PM UTC

CSMastermind wrote: post #338

david2ndaccount wrote: post #330

The issues with physical currency are almost entirely self-inflicted. Governments should retire the smallest denominations and introduce larger coins/bills. In the US, all of the coins are worth so little that the only practical coin is the rare half-dollar. Retire all of those worthless coins, require transactions be rounded to the nearest half-dollar or dollar, and issues with physical currency for the user will go…

I would argue the root cause of this phenomenon is inflation and the first step we should take is to make the dollar a stable unit of measure not to consciously allow its value to fall.

Deflation is worse than inflation, and it's hard to hit a single number, so central banks aim for low, stable inflation. 1-2% inflation isn't very perceptible vs 0 but avoids deflation.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#364

Post by ACS_Solver » Sat, Feb 03, 2024, 4:54 PM UTC

boricj wrote: post #307

ACS_Solver wrote: post #256

Earlier quoted context omitted.

Such robustness is currently a subject of government studies and planning. It's definitely an area of concern. A personal-level outage is a problem but less so than with cash. I have three separate items on me I can use to pay - my card holder with bank cards, my phone and my watch. That's more redundancy than with cash, which is one item (wallet). Power or network outages aren't a big issue. I've experienced those a…

> I have three separate items on me I can use to pay - my card holder with bank cards, my phone and my watch. That's more redundancy than with cash, which is one item (wallet). All of which are electronic and depend on centralized services. Bank notes and coins work offline and without electricity. Not too long ago, a restaurant I went to with a coworker had an Internet outage and no card or mobile payment would go t…

The hardware/software infrastructure for cards and mobile payments is separate. We get card outages or Swish (mobile) outages occasionally, I don't remember any that affected both. Card payments are expected to work offline.

We're so dependent on IT systems that even cash doesn't always work. One of the most significant outages we've ever experienced was when Coop, a grocery store chain, had to close all its stores for a couple days because of an IT outage. It didn't help that the stores accept cash - the payments still couldn't be registered, receipts couldn't be printed, so the stores were completely unable to function.

We clearly need a robust fallback solution. Some kind of payment system that can work despite centralized outages (a bank's systems failing) or local outages at the merchant. But that shouldn't be cash. The practice of exchanging fragile, filthy pieces of paper whose ownership you cannot prove once outside your possession belongs to the past, we can do much better now.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#365

Post by sneak » Sat, Feb 03, 2024, 4:54 PM UTC

ACS_Solver wrote: post #118

madsbuch wrote: post #11

I Denmark we are removing the 1000kr bill as of May 2025. from then on the highest bill. is 500kr which is roughly equal to 80 usd. Denmark Is the most cashless society I have yet experiences (and I have been traveling a fair bit). This comes with pros and cons. and I think the reason why it works is because of an incredibly high social trust.

I'm in Sweden, a strong contender for the most cashless country, and I don't know what the banknotes look like. They were changed some 5 or 6 years ago and I haven't paid with or even withdrawn cash since then. For illustration, cash is generally not accepted outside of grocery stores and some chains. For a typical restaurant, coffee shop or takeaway there's very little chance they take cash. Street vendors may take…

This is the same Sweden that issued a bogus arrest warrant for Assange?

If you think they won’t point and click seize your assets and freeze your accounts prior to trial for publishing the wrong thing, you’re crazy.

Cash is the backup, and must be preserved. Electronic payments can be centrally censored.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#366

Post by [deleted] » Sat, Feb 03, 2024, 4:55 PM UTC

sneak wrote: post #361

coppsilgold wrote: post #358

It's technologically feasible to create centralized digital cash that is much more anonymous than physical cash. You can do it by using zero knowledge proofs where you have vouchers & nullifiers. It's virtually the same idea that powers Tornado Cash. It's tractable but challenging, every single transfer of a digital-cash note would necessitate an entry into a public Merkle-tree. You could mitigate this by introducing…

Governments did everything they could to stop Tornado Cash. Uncensorable, anonymous digital payments is the very last thing the state wants for its citizens. That allows private people to raise (and pay for) an army. Preventing rival armies within their territory is the primary and most important function of a state.

[deleted]

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#367

Post by bookofjoe » Sat, Feb 03, 2024, 4:56 PM UTC

I've been reading this for going on 30 years and I still have some in my wallet which is accepted everywhere. Seems to me this is just a recurring trope trotted out for want of an article topic.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#368

Post by progbits » Sat, Feb 03, 2024, 5:07 PM UTC

SoftTalker wrote: post #298

j7ake wrote: post #230

Earlier quoted context omitted.

Cash only restaurants are often 10-20 percent cheaper than comparable restaurants.

My barber only takes cash. $18 for a standard haircut.

That's not because of card fees but because of taxes. They can underreport their cash income, but can't do that if the bank and card processor are involved.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#369

Post by panarky » Sat, Feb 03, 2024, 5:14 PM UTC

gizmo wrote: post #318

SoftTalker wrote: post #286

Earlier quoted context omitted.

Yes there are costs to handling cash. And they are vastly higher than the cost of handling bits. A 3% fee to write some bits to a database is insane. A 3% fee to pay all the people who need to handle the currency in a cash transaction is probably not covering costs.

That’s such a misrepresentation. The credit card fees exist because customers get benefits like delivery insurance, return insurance, holiday insurance, cashback, free credit, etc. If you just want to transfer bits you can do that for next to no fees (in Europe, where digital payments without consumer protections are common).

> such a misrepresentation

Exactly. All the talk about fees misses the point because accepting and securing paper money is also very costly.

And the provocateur's stunt in the article also misses the point, because electronic payments for groceries aren't a dystopian tyranny no matter how loud he screams about it.

And the crypto skeptics are missing the point when they say you can't buy a coffee with bitcoin, because buying coffee is a solved problem, tap to pay with a bank card works just fine.

And the crypto advocates are missing the point when they say that lightning or solana or something else will solve the coffee-buying conundrum because that's not a problem that needs solving.

The real point about cash payments and crypto is whether people should be able to make large person-to-person payments that are not trivially surveilled or controlled.

In a free society, should people have this capability? Or are the dangers of illegal transactions so great that this freedom must be eliminated?

Europe has mostly free and mostly instant SEPA transfers which are one answer. Large payments are easy and cheap, though they are not secret or untraceable. Perhaps that's a reasonable trade-off.

The US payments system is a mess by comparison, where we have no privacy paired with extreme inconvenience. Try to buy a $20,000 car from a private party on a holiday weekend to see how well that works.

Re: Physical cash is dying–and you don't need to be a conspiracist to worry

#370

Post by tomatocracy » Sat, Feb 03, 2024, 5:15 PM UTC

tyfon wrote: post #297

vixen99 wrote: post #273

Earlier quoted context omitted.

Some quote! "I work in a bank and cash handling is a major headache". Doubtless but perhaps we should reconsider the larger purposes of the banks in relation to their customers.

The biggest reason for banks to exist is too provide "grease" for the economy, i.e. to connect people with money to people who needs to borrow :) Most banks here don't handle the actual payments themselves except the biggest ones. The small "savings banks" like the one I work in doesn't have shareholders either, they are owned by the depositors. Almost every small town and community here has one.

The most valuable service banks provide is not just "matchmaking" lenders with borrowers (an exchange of some sort can do that much more cheaply) or even spreading credit risk across a pool of borrowers (again there are other ways to do that which are cheaper), but maturity transformation: depositors can lend money to the bank which is repayable on demand, but the banks' borrowers are given set repayment schedules.