19--[CTRL] Smart Cards and Private Currencies

19--[CTRL] Smart Cards and Private Currencies - [CTRL]...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Sheet1 Page 1 [CTRL] Smart Cards and Private Currenciesctrl <-- Thread --> <-- Date --> Find [CTRL] Smart Cards and Private Currencies Kris Millegan Sun, 21 Mar 1999 11:54:08 -0500 -Caveat Lector- from: http://www.zolatimes.com/V3.12/pageone.html <A HREF="http://www.zolatimes.com/V3.12/pageone.html">Laissez Faire City Times - Volume 3 Issue 12</A> The Laissez Faire City Times March 22, 1999 - Volume 3, Issue 12 Editor & Chief: Emile Zola ----- Smart Cards and Private Currencies by J. Orlin Grabbe Smart cards are a type of electronic card, looking much like a credit card, but with a computer chip embedded in the plastic instead of a magnetic stripe attached to the surface. Smart cards can be used for many purposes, such as identification, access control to an office or a computer, making phone calls, or storing money (value) which may be spent in more than one location. Millions of smart cards are currently in use providing billing for digital mobile phones, allowing prepayment for gas, and controlling the viewing privileges of satellite television subscribers. Smart cards have a natural role to play in eliminating government monopoly over currency issue. (I include among government monopolies the curious case of the U.S. Federal Reserve, which is privately chartered, but which acts as a government handmaiden.) Smart cards will assist in the development of private currencies to compete with, if not replace, today± s prevalent types of monopoly money. Writing in the 1970s about the need for private currencies to compete with official national brands, the economist Friedrich A. Hayek noted the practical difficulties of having different sizes, shapes, and weights of coins when it came to acceptance by vending machines and similar devices. He wrote: Hayek thus anticipated smart cards and digital signatures. More recently Browne and Cronin have asserted: "We believe that research on laissez-faire banking should give greater attention to the potential Another possible development would be the replacement of the present coins by plastic or similar tokens with electronic markings which every cash register and slot machine would be able to sort out, and the ( signature± of which would be legally protected against forgery as any other document of value. [18]
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Sheet1 Page 2 implications of rapidly improving technology in electronic payment instruments (based on integrated circuit/smart cards and advances in telecommunications) which are being developed by private sector banks." [5] In this article I will pay particular attention to the use of smart cards for storing or transferring money. Money in a modern economy consists mainly of numbers in a computer. When you write or draw a check on your banking account, the account balance or number associated with your name in the bankf s computer is reduced. When you make a deposit, this number is increased. It works the same way with stored-value cards or other balance-maintaining mechanisms. For security, it is important is to ensure that this number, or balance,
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 40

19--[CTRL] Smart Cards and Private Currencies - [CTRL]...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online