What is DigiCash, or the History of the world’s first digital currency

You can often hear that the history of cryptocurrency started in 2008. Wallpaper of Bitcoin — in other words, the concept of development of the project was released 31 Oct 2008. That is, just at the time when centralized institutions like banks are faced with the real threat of mass liquidation. It was written by a person or group of people under the pseudonym Satoshi Nakamoto, whose identity is still not disclosed. The document consists of nine pages and describes in detail the operation of the network peer-to-peer (direct) remittances.

Initially Bitcoin was supposed to work a variety of computer geeks, scientists and cryptographers. However, the idea of the Protocol for electronic money existed long before that. DigiCash was one of the first serious attempts to create an independent system of electronic money.

The contents

What is DigiCash?

In short, DigiCash is a company that created digital money long before the advent of the blockchain. She sought to make anonymous electronic payments, but, unfortunately, went bankrupt before the moment when it was fully implemented.

Payment system DigiCash was developed in the early 1990-ies. It was designed to allow users to securely pay for goods and services on the Internet, which itself was created only a few years before the payment system.

Who created DigiCash?

David Chaum. Source: Coin Rivet

The Creator of DigiCash is an American cryptographer and scientist David Chaum. We have already mentioned it in our other articles. Overall, it was an attempt Chuma to test various proposals for the creation of neatsiejamai payment system. He first outlined the theory in their own research of the 80-ies made while working at Berkeley.

A brief history of DigiCash

  • June 1983 — article Chuma with the description of the system of anonymous electronic payments is published in an academic periodical.
  • The end of 1989 , Chaum founded DigiCash.
  • 1994 — DigiCash bypasses giants such as Visa and Mastercard on the part of petty payments via the Internet.
  • 1996 — Chum ceases to participate in the management of the company.
  • The end of 1998 — DigiCash declaring bankruptcy.
  • 1999 — Coum selling their patents and completely leaves the company.
  • February 2002 — DigiCash sell for assets.

In fact, Coum never got along with his staff. Some argued that he “superparanoid”. Source: Chaum.com

What is the feature of DigiCash?

  • Electronic transactions: DigiCash was the first serious attempt to create a viable electronic payment system.
  • Anonymous payments: a new cryptographic protocols allow you to send transactions without having to divulge any personal information.
  • Security: cryptographic tools Chuma — like the private key — also allowed merchants to store sensitive information within the system.
  • The first cryptocurrency: DigiCash allowed users to send and receive “cybersexy”. This digital currency not controlled by Central institutions or banks.

How were cybersexy?

For the creation and issue of cyberbucks (Cyberbucks) answered DigiCash. In the process of testing the network to determine the dynamics of the currency was released a million tokens, which were distributed between early adopters and enthusiasts. More cybersexy were not issued.

At DigiCash was a long negotiation with a major international Bank Citibank. The Bank has expressed interest in using cibersexo. However, in the end, the institution has moved on to other projects.

How does DigiCash?

Purchase cibersexo: users DigiCash needed to start to withdraw money from your Bank account and then redeem them for Cyberbucks. After that, digital money is stored on the user’s hard drive.

Transaction DigiCash: users can use cyberbass to pay for goods and services. The buyer has received the payment request, proof of which is allowed to send cybersexy the seller on the Internet. The recipient could automatically exchanging cybersexy for dollars and make them into a Bank account.

Source: 2Биткоина

Blind signatures: transactions in the network DigiCash can be done private. Despite the fact that banks were able to keep track of created coins, a user could conduct a transaction in a special digital “envelope”. Thus, banks could verify the validity of a transaction without having to disclose personal information of the sender.

That could be done with DigiCash?

In fact, DigiCash was a safe method of conducting transactions over the Internet. The success of the network largely depended on the number of users wishing to use cyberbase. And sellers willing to accept payment in this form. Most of the time — including Visa and Mastercard could only handle large sums electronically. In turn, DigiCash allowed to send a small transaction. It would seem that the system is ideal for developing online Commerce sector.

Many people at that time used electronic money to buy CDs or shirts that can be ordered with delivery or pick up at a physical store.

Why DigiCash is so important?

DigiCash was an experiment. It was an attempt to use computers and the Internet — which then was still in its infancy, to create alternative payment networks, focused on convenience to the person. It was not decentralized, and constant monetary liquidity is still needed by the banks.

But this model formed the basis for later projects, including the Bitcoin Satoshi Nakamoto and other existing cryptocurrencies. Developments in cryptography David Chuma used to this day. Thanks to him, the transactions on the blockchain are safe and effective.

Chum compares the failure of DigiCash is the problem of "chicken and egg". Users have complained that there are few sellers, and the sellers stated that they do not have enough users willing to pay with digital money. As we can see, 20 years later, cryptocurrencies are increasingly being used as natural persons, and financial institutions. And although the DigiCash experiment was not a success, he was one of the main steps in the history of modern digital currencies.

In our cryptodata Shirobokov you will find lots of other useful information. Also looking forward to your visit in Yandex Zen.

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0 Comments on “What is DigiCash, or the History of the world’s first digital currency”

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