413 sats \ 6 replies \ @freetx 21 Jan \ on: Is There A Way To Prove Mints Aren't Inflating Supply? ecash
No, there is no cryptographic way to ensure you are not being frac-reserved.
The only ways would be operationally (ie. coordinated bank run feature of wallets, etc) but these all have usability and potential fee impacts.
To be clear, other federated solutions (ie. sidechains like Liquid) have an auditable supply of tokens issued. So all of this is a matter of trade-offs.
The issue I see with Chaumian eCash long term is that the tendency will be for federations to grow in size (network effects). Who believes Coinbase, once they become the biggest mint, wont reserve-frac their users?
Until this is resolved it seems to me that all large organizations running mints should be avoided, similar to our mantra of "get your coins off exchanges." That's why I see the use case as small family and friends mints right now.
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Yes. Either small known-party mints or conversely short time-duration mints.
I think these "ad-hoc" mint setups could be really good (ie. my 3-day festival idea I've posted about in other threads). So in this case the threat to frac-reserve would be limited by your time exposure to the mint itself. (add an auto expiry function added to Cashu protocol?....hmmmmm....)
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If I remember correctly, in the early days this seemed to be the use case everyone envisioned. I guess it changed at some point?
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That is what I'm talking about. Use it and trow away. But this is just banking on steroids. Our own version of rug pulls.
Now I see your concern from the other day. I didn't realize this was even an issue
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That is why I just see ecash more like a toy, use it and immediately cash out for real Satoshi.