Crypto Critics' Corner The ECASH Act (Feat. Rohan Grey)
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Apr 4, 2022 Could a digital dollar preserve the privacy of cash? Rohan Grey discusses the ECASH Act’s hardware-based approach, how it might coexist with bank accounts and other forms of money, and what everyday use could look like. The conversation also explores prepaid cards, open-source safeguards, government implementation hurdles, and the politics of financial privacy.
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Central Bank Models Clash With Cash Privacy
- Central bank design defaults to account models and AML/KYC obligations that conflict with cash-like privacy.
- Making the Fed the operator risks embedding identity-checking and third-party data collection into digital cash.
Issue Centrally Then Let Devices Settle Peer To Peer
- Design issuance centrally but make payments peer-to-peer using trusted hardware; secure issuance simplifies preventing counterfeiting.
- Issue tokens offline at Treasury, distribute via withdrawals or prepaid cards, then transfer by device handshakes.
How Device Handshake Transfers Invalidate Spent Tokens
- Transactions would work by device handshakes where signatures are destroyed and recreated so spent tokens become invalid.
- Devices hold records locally; kiosks could validate legitimacy like checking a banknote under UV light.