Saturday, September 26, 2020

No bearer cash in a loop?

 Consider the case we all have cards supporting bearer cash. If I check cash from my account and pass it out, I might receive some of that cash back, via a chain of automated contracts. Now, I would consider that a requirement to mark the ledger, for Swift, in any event, loops need to be unraveled for contract stability.

If bearer cash loops are not unraveled then we have an arbitrage point for the cash originator. So, for the limits on bearer cash, like the built in limit, no double spending, there are optional limits or contract conditions imposed by the ledger authority. Swift money will almost certainly ban loops. The Bitcoin block chain likely doesn't care, except for bitcoin closed slice networks. And ethereum handles it implicitly in bandwidth payments. This is the same as saying all bearer cash should have some timeout.

Automated trading always wants congested contracts to clear, sooner the better. The pits keep hot wallets and have short, finite limits on liability.

No comments: