Hi Ian et al.,

I think you overstate in saying Peter is wrong. The sort of Chaumian ecash that people were looking at has not yet come about for a variety of reasons that you probably know quite well. Peter's story is not wrong, just incomplete. I imagine he had space constraints and could not cover more aspects without muddying the points he did make. (E.g., I spoke to him for the better part of an hour when he was working on this article, which got distilled into a one line paraphrase.)

It's good that at least you and a few others recognize the transitions from FC research results to actually implemented business process, and it would be nice if these got still wider attention. Peter did note a few of those (e.g. Peppercoin) as well as that credit cards took decades to attain their current success.

Your point about unsung successes is well taken, but your explanation misses the mark in my opinion. The board has constantly looked for ways to better involve the business community and those with exactly the sort of savvy you described, with only limited success to date. Primarily they have attended as invited speakers or panelists. And, contra what you said, PayPal did tell the FCers. Specifically, Jack Selby came last year and gave a very enlightening description about what PayPal did in the beginning, how it relates to ecash, and why the fortuitous concurrence of uncharted financial regulation and business circumstance make it unlikely to use the rise of PayPal as a direct model for future success. Still, FC has not exactly become a must-not-miss venue for the banking/financial community although a trickle of interest has persisted. There are various reasons for this following the myopic expectations of the mid-to-late nineties, which cut a much wider swath than just financial cryptography.

Aside: Part of the blame goes to the direct and indirect representation of the conference as a vacation. This is one thing that irks me. I'm sure that, like any conference held regularly in a pleasant setting, there will inevitably be some people who will treat FC as an excuse to have a vacation. However, many of us have managed to get much work done there, and I have used the general approach of the conference as a model for others I have organized (in diverse locations) because of its strength in that regard.

The researchers have persisted largely because they have found it a valuable venue to exchange research ideas. Digital cash is not the only thing with a chicken-and-egg problem. The larger perspective you talk about in your comments (and show some of in "7 layers") is a very rare commodity. Business people who would expect (most of) those providing the formulas and equations to also provide business context would be at least as naive and misguided as any researcher who upon inventing something really cool, useful, and mathematically correct expects some VC to come and throw money at her. And, it is almost impossible to show both aspects in one brief presentation, regardless of your perspicacity. Financial Crypto is, in my experience, perhaps the only venue that tries to get these people in the same room. This is crucial. One of my erstwhile other hats is as a formal methods person. Typical in that area is to devise wonderful methods, announce them, and then criticize the engineers who make mistakes and have delays and cost overruns that they wouldn't if they would just use the tools that are out there. On the other side are engineers who have deadlines and no time to cope with some theoretical mumbo jumbo that is not connected to "the real world" in any way they understand. I know of a few major successes that came about because some people went through the door and spent a long time in give and take with the other group rather than just lobbing complaints back and forth over the wall.

We continue to struggle with this, and if you have suggestions for how to bring in the bankers big time without chasing away the cryptographers, I think we would love to hear them. But if we simply try to give the business perspective on what we are offering and lose the ability to actually offer it in the process, we will not have a venue for anybody at all.

aloha,
Paul

Hi Paul,

as I'm

Paul Syverson wrote:

> Hi Ian et al.,
>
> I think you overstate in saying Peter is wrong. The sort of Chaumian
> ecash that people were looking at has not yet come about for a variety of
> reasons that you probably know quite well. Peter's story is not wrong,
> just incomplete. I imagine he had space constraints and could not
> cover more aspects without muddying the points he did make. (E.g., I
> spoke to him for the better part of an hour when he was working on
> this article, which got distilled into a one line paraphrase.)
>
>

Sure! When it comes to a quick article, opinions tend to be best dealt in exaggerated form. Hence, responses will also be exaggerated the other way :-)
...

> ... And,
> contra what you said, PayPal did tell the FCers. Specifically, Jack
> Selby came last year and gave a very enlightening description about
> what PayPal did in the beginning, how it relates to ecash, and why the
> fortuitous concurrence of uncharted financial regulation and business
> circumstance make it unlikely to use the rise of PayPal as a direct
> model for future success.
>

Ha! I'd say PayPal is a text book case of how to model future success :-) But I guess I had to be there. I don't suppose his keynote is online anywhere?

> Still, FC has not exactly become a
> must-not-miss venue for the banking/financial community although a
> trickle of interest has persisted. There are various reasons for this
> following the myopic expectations of the mid-to-late nineties, which
> cut a much wider swath than just financial cryptography.
>
>

If the board is thinking the presence of 'bankers' and heavy hitting financial wall street types would be a measure of success, I'd say that is a *huge* mistake! The 'bankers' have very little to offer other than money. It's all happening elsewhere, the fact that 'finance' makes an appearance in the title should be considered critically, as much as the appearance of 'crypto.'

> Aside: Part of the blame goes to the direct and indirect
> representation of the conference as a vacation. This is one thing that
> irks me. I'm sure that, like any conference held regularly in a
> pleasant setting, there will inevitably be some people who will treat
> FC as an excuse to have a vacation. However, many of us have managed
> to get much work done there, and I have used the general approach of
> the conference as a model for others I have organized (in diverse
> locations) because of its strength in that regard.

I think the vacation aspect is basically just gossip fuel for people on the outside. For a lot of real FCers in the old days, it's the only vacation they ever got, so I don't see the problem. If the conference works, people will overcome the vacation issue.

> The researchers have persisted largely because they have found it a
> valuable venue to exchange research ideas. Digital cash is not the
> only thing with a chicken-and-egg problem. The larger perspective you
> talk about in your comments (and show some of in "7 layers") is a very
> rare commodity. Business people who would expect (most of) those
> providing the formulas and equations to also provide business context
> would be at least as naive and misguided as any researcher who upon
> inventing something really cool, useful, and mathematically correct
> expects some VC to come and throw money at her. And, it is almost
> impossible to show both aspects in one brief presentation, regardless
> of your perspicacity. Financial Crypto is, in my experience, perhaps
> the only venue that tries to get these people in the same room. This
> is crucial.
>

Just on that point, there are other venues.

Dave Birch's conferences are actually a lot closer to the polymath ideal of FC. Yes, they are couched at a commercial audience, and that means that academics cannot accept what he does; but the way he integrates strands from many different areas creates a great experience, much like the original 1997 FC (at which he keynoted!)

Also, I and some mates ran an engineering aspects FC conference a couple of times, and it worked well enough to carry on (but as you know it's a lot of work, and we faltered). However, what we copied from MacCrypto was also copied from us by the SanFran conference that was recently run. I forget its name, but except for the lack of financial emphasis, it did the same thing as we did: get everyone who is *building* together.

Also, there are now the workshops on contracts (WEC), and the workshops on economics and security - both things that would have been fantastic if done under the general FC rubic.

> ...
> We continue to struggle with this, and if you have suggestions for how
> to bring in the bankers big time without chasing away the
> cryptographers, I think we would love to hear them. But if we simply
> try to give the business perspective on what we are offering and lose
> the ability to actually offer it in the process, we will not have a
> venue for anybody at all.
>
>

See other mail. It all starts from the selection committee!

iang

There is a vast communications gap between crypto researchers and the financial community, and while the first one or two FC conferences made a noble effort to bridge it, ultimately the effort failed and the separate communities went their separate ways, leaving pure cryptographers in charge of FC. Today FC papers are unreadable to anybody without heavy-duty training in crypto, and if you do manage to grasp their reasoning you usually realize they are making dubious assumptions or trying to solve problems that aren't very important. For example, a vast amount of effort and hype has gone into trying to improve the computational transaction costs of micropayments, when the limiting factor on payment size is mental transaction costs (see http://szabo.best.vwh.net/micropayments.html and http://szabo.best.vwh.net/berlinmentalmicro.pdf).

Furtheremore, the reach of what the papers claim they are designing ("payment systems", "auction systems", etc.) is far longer than their grasp (some interesting protocols that solve certain perceived sub-problems in such systems or might be useful as components of such systems). As we learned at Digicash, in a real world payment system you can't just focus on one cryptographic idea, no matter how good it is -- it's just a small part of a payment system that will give rise to a wide variety of other kinds of problems that must be solved in other ways. It's important that cryptographic solutions not get in the way of these other solutions, but in FC papers there is little awareness of such problems.

While many FC papers pursue irrelevancies, relatively little effort has gone into making improvements to controls and separation of duties, which are both the dominant costs in real-world payment systems and the place where computer science has the most to contribute (whether through Byzantine agreement, cryptography, improved audit logs, or many other possible protocols in this area). Where are the accountants and auditors who understand financial security problems and the controls used to solve them on the list of paper reviewers and authors for FC?

While there is potentially a very great value in FC, it is mostly lost on the financial community, and most of what is needed by the financial community is lost on the FC community.

I'm sure that, someday, people will remember what the "F" in "FC" stands for.

Amazing how these boys in the academic field take the good conferences and run them for their benefit. Commercial Cryptography is probably a better fit for the real field.