Editor’s note: Kash is a protocol, not a company.
Founder: Curry
Establishment date: October 2022
Head office location: remote
Amount of Bitcoin held in the Treasury: N/A
Number of employees: 20-30 open source developers
Website: https://cashu.space/
Public or private? Not applicable
Of Bitcoin’s many notable properties, privacy is not one of them.
In fact, Bitcoin’s transparency is blockchain It is in sharp contrast to privacy Chomian Ecashis a type of digital cash created in 1982 by legendary cryptologist Dr. David Chaum.
So what do these two technologies have to do with each other?
Now, 40 years after the invention of electronic cash, failed attempt In the 1990s, when attempting to integrate Bitcoin into traditional financial infrastructure, a developer with the pseudonym “Calle” found a home for the technology within the Bitcoin ecosystem.
“Ecash was waiting for Bitcoin as the foundation layer,” Calle told Bitcoin Magazine. “Bitcoin is a permissionless system that allows anyone to build financial innovations without consulting the big banks. It’s a better environment to experiment with this technology.”
Calle has innovated this technology by: Kasha free, open-source electronic cash protocol that he released to the world in October 2022. Cashu allows users to get the best of both worlds: Bitcoin and the Shormian world of electronic cash.
As readers of this publication probably already know, How Bitcoin workseCash may be a new concept.
What is e-cash?
Ecash is a bearer asset that can be transferred peer-to-peer, similar to Bitcoin.
However, the main difference between eCash and Bitcoin is that Bitcoin exists on a ledger, whereas eCash exists on the owner’s device.
“For us Bitcoiners, Ecash is a very foreign concept that flips the idea of a ledger on its head,” Calle explained.
“In an electronic cash system, who owns what is determined not by who has electronic cash in their pocket, but by ‘what does this database say about who has what?’ ,” he added.
On a more technical level, eCash tokens are essentially IOUs that: cast Using the technique ofblind sign”
Cashu uses this to allow ordinary users to operate mints via the Lightning Network. guidewritten by Calle.
What motivated Calle to create Cashu?
You might think that someone who covers their face with a bright orange face wrap when appearing in the media would be motivated by some pretty extreme ideology, but that’s not the case with Cal.
Instead, he is incredibly down-to-earth, practical and very logical. His goal in building Cashu is simply to preserve the privacy that has been maintained for centuries in financial transactions.
“We have been using financial private means for hundreds of years without realizing that we were using one of the best technologies in financial privacy: physical cash,” Cal said. he said.
“So, really, we’re not trying to bend towards something we’ve never experienced. We’re just preserving what we already enjoy,” he added.
Mr Kalu wants to see Chaumian’s e-cash succeed despite the challenges Dr Chaum faced when trying to introduce e-cash into the traditional financial system through his company. digicash In the 90’s.
“Shaumian Ecash had a very big mission,” Kalu said.
“It was supposed to revolutionize the entire financial world. But unfortunately, PayPal and Visa took over,” he added.
“I’m also realistic in that I chose to build this on Bitcoin, because Bitcoin is the only world where you can start building something like this open source. is.”
Electronic cash in Bitcoin
One of Calle’s goals in building Cashu on top of Bitcoin is to allow more people to use Bitcoin for everyday transactions.
“Bitcoin needs to be carried by a diverse group of people, so the public can understand the huge potential this technology offers,” he said.
He also believes that to get more people to adopt Bitcoin, we need to be more deliberate in our approach and let the technology speak for itself.
“You don’t have to be against the state to love Bitcoin. You don’t even have to believe in separating money from the state,” he said.
“Ideology spreads much slower than technology. Technology can explode overnight,” he added.
“Explain to people that we found the money that is the Internet. This has only happened once in the history of the Internet, but we have crossed that line. Let’s spread that message. .”
When I asked Cal what he thought about things these days, Crackdown on Samurai Wallet developers Although he did not directly respond that privacy-focused protocols built on top of Bitcoin, such as Cashu, could be in the crosshairs of regulators, there are concerns that the traditional financial system could be put at risk. The same goes for electronic cash, which they didn’t seem particularly worried about, as they pointed out that it was.
Ecash surpasses Bitcoin
“There is a very active debate going on in Europe about what a CBDC would look like,” Kull explained.
“The ECB also intends to consider an electronic cash system that offers cash-like privacy for transactions under 300 euros. The Bank for International Settlements is currently piloting an electronic cash system. Swiss National Bank and Switzerland “Parliament itself is considering introducing electronic cash for its own digital currency,” he added.
“We believe that ecash has the potential to be used in a completely legal and compliant manner.”
According to Calle, the increased privacy that comes with using eCash is a net positive for those who use the technology, whether it’s Bitcoin or within traditional financial structures.
Who uses ECash?
Like Bitcoin, eCash is available to everyone. Specifically, it is for people who want to make digital payments privately.
“The weakness of digital payments is that every payment is tied to an ID,” Carre explains. “There is no reason why you need KYC to read articles on NYTimes.com. These online activities should not be tied to your bank account, especially if you are reading political articles.”
According to Calle, Nostr users are already using eCash minted with Cashu in several privacy-based chat applications.
It’s also sometimes used as payment to prevent Denial of Service (DoS) attacks, and some users have even used it to pay for a VPN without revealing their identity.
But Kalu seemed most enthusiastic when discussing how electronic cash could be used by people who don’t have bank accounts or whose bank accounts have been discontinued because of their political affiliation. .
“How this could become a regional banking infrastructure in areas of the world where banking systems don’t exist or where banking systems are so outrageous that dissidents and political activists basically can’t use digital money. “I think about it a lot,” he said.
In preparation for such a case, Kalu also explained how to build a system to issue electronic cash denominated in fiat currency backed by Bitcoin.
“We can build a fiat payment experience in the most private, fast and efficient way, very close to physical cash, without touching the fiat banking system at all, but still entirely based on Bitcoin. “We are very excited about the stablecoin, which is very popular and has taken over the popularity of Bitcoin in most parts of the world,” he added.
“There is a clear demand for it, and fiat currency on ecash is the best form of fiat currency I can think of.”
Please proceed with caution
Although there are many benefits to using ECash, it is also important to be careful when using this technology.
Given that ECash is minted through a custodian, its use involves counterparty risk.
“I would urge anyone to be very careful about the custodian they choose,” Kull warned, paring his statements with a caveat and explaining how the team behind Kash is trying to offset some of the risks involved in trusting the mint with a reputation-based star rating system.
“For those who use Cashu, we recommend that they use it in very small quantities. If you keep it in your pocket like a wallet, it won’t hurt as much if you lose it at a bar,” he added.
He went on to state unequivocally, “When the mints go down, so do your sats.”
There is also a risk of losing your funds if you lose the device on which they are stored, but Cashu has created a way to recover your lost eCash.
“Cashu itself has a mechanism to restore the token if it is lost, similar to the Bitcoin UX that stores the seed phrase,” Calle explained.
However, he also pointed out that users will restore their funds through the Mint, and if the Mint goes down, users will permanently lose their tokens.
call to action
Cal does not profit from his work with Kash. Although he started this project out of an “academic interest,” he has found a greater purpose in developing it and has driven it forward.
“Working on Bitcoin is a great honor and an opportunity to give meaning to life, because it is a project for humanity,” he explained.
“It’s great to be a small part of this process, knowing every day that my work is improving the world and not benefiting the giant tech companies that are sucking the life out of me.”
So, in addition to recommending the use of Cashu if you are looking for more privacy in your everyday Bitcoin transactions, he also invites developers, or anyone with skills related to Bitcoin adoption, to help promote Bitcoin adoption.
“I know a lot of people who have the desire to work on something that makes the world a better place, and Bitcoin is an open system that anyone with any skill level can participate in,” Cull said. Ta.
“For people in big tech who have lost meaning in their work, this is an opportunity to do something meaningful, global and inclusive,” he added.
“Let’s go to the moon together.”
