This one is real though!

Why was it removed from /ecash? This is clearly a legit ecash discussion.

nope, that's exactly the ecash magic! the mint never sees the ecash until it's actually spent. that means, when you restore unspent ecash (even though it is in cooperation with the mint) the mint does not know which token you're restoring.

you can imagine it a bit like as if the mint only has the encrypted token and you are the only one who can decrypt it. after decryption, the mint can't know what encrypted token it corresponded to.

Thank you for the zap forward 🙏 I don't know how I deserved this but I'm very grateful for it

It's a seed phrase like with Bitcoin, it can be used to regenerate the ecash you might have lost. The only difference is that you need the cooperation of the mint to restore your ecash in the process. Your privacy still remains intact though, the mint just re-issues you what it already issued before.

You can automate bank runs: https://gist.github.com/callebtc/ed5228d1d8cbaade0104db5d1cf63939

I have an experimental PoL server running already for the testnut mint. It's going to take a while until wallets can adopt this, there's still a ton of possible optimizations to make this be effortless. But the sheer existence of a possibility to audit ecash mints is already very bullish to me.

I'm trying to fix that: https://gist.github.com/callebtc/ed5228d1d8cbaade0104db5d1cf63939

Very thoughtful summary. I mostly agree with everything you've said.

One note on gift cards: in some European countries, gift cards can become "e-money" and must then be regulated as such if (I'm quoting from memory) their purpose and utility becomes "too universal", i.e. you can doo too many things with them. I've heard (I might be completely wrong, didn't verify) that Amazon gift cards are regulated as e-money in Sweden because of this: you can buy too much different stuff with it and people started using it for a money substitute.

Insane if you ask me.

Anyway, awesome post. Have a zap.

Thank you I was always wondering what the difference is but that actually makes sense now!

🤝

You might be interested in this: A Proof of Liabilities Scheme for Ecash Mints

That's not how banks work.

Please let's not start saying that ecash is self-custodial. It is not.

You hold the ecash, we get it. The ecash part is non-custodial, ok. It's been thought of that way since the 80s. It's fine to think that way if you're literally the central bank and the ecash you issue IS THE MONEY AND NOT A REPRESENTATION OF AN UNDERLYING ASSET – only a central bank can do this. Repeat with me: Only a central bank can do this.

Ecash today is a representative of an underlying asset. In Cashu and Fedimint that's BTC. You give up control over that underlying asset. You measure everything in terms of that underlying asset. It is all about the underlying asset. You have NO GUARANTEE WHATSOEVER TO REDEEM THAT UNDERLYING ASSET BACK – ecash systems the way we are building them today ARE CUSTODIAL – please don't make things more complicated than they need to be. Please do not manipulate language and especially, do not confuse noobs who are still learning. I almost want to say that a framing like this irresponsible.

What are you going to say to the noob who wants their Bitcoin back but the federation broke down during an update and the database got completely rekt? How is that non-custidal or self-custodial or whatever the opposite of custodial is.

With all due respect, this is a bad take.

I'm not sure I understand what you're saying but it seems very clear to me:

it's custodial bitcoin and noncustodial ecash.

I thought we were talking about Bitcoin custody: it's custodial Bitcoin.

Great post. I disagree with one very central premise though:

I do think so. Custody is when one or more parties have control of your funds, and you don't. It doesn't matter if it's a single sig, or a multisig. Not your keys, not your coins.