There used to be a Journal of E-Finance and Payments Law and Policy (that later became Payments & Fintech Lawyer). Way back in 2009, I wrote a piece on micropayments for them (Vol. 3, No 2, p.11-13, February 2009).
While watching Jon Stewart’s Daily Show recently, my interest was re-kindled by his interview with Walter Isaacson of the Aspen Institute who had written a story about this for Time magazine, in which he (Isaacson) had referred to an odd paradox of content2:
Thus we have a world in which phone companies have accustomed kids to paying up to 20 cents when they send a text message but it seems technologically and psychologically impossible to get people to pay 10 cents for a magazine, newspaper or newscast
I said at the time that the technological determinist saw a straightforward explanation: people won’t pay 10 cents for stuff on the Internet because they cannot, whereas they will spend $1 for a ringtone on their phone because they can. I remember thinking “well, I can load ringtones to my iPhone for free if I want to mess around, but I can’t be bothered to, so I just pay in iTunes”. It is cheaper and quick for me to pay than for me not to pay. Therefore, perhaps the technology as much as the business model is to blame. Isaacson goes on to say just that.
We need something like digital coins or an E-ZPass digital wallet — a one-click system with a really simple interface that will permit impulse purchases of a newspaper, magazine, article, blog or video for a penny, nickel, dime or whatever the creator chooses to charge.
This was seen as a fundamental problem at the very dawn of the web and I’ve been thinking about it again this week because of a comment on saw on social media. Alex Pilar was talking about the tsunami of AI-generated slop that is about to wash away the internet as we know and he said that this might drive something that the spam of old could not: the use of Hashcash.
Hashcash was an idea of Adam Back and was influential in the evolution of Bitcoin. The idea was simple: come up with a problem that is hard to solve but has a solution that is easy to check. It was originally developed to counter spam, with the basic operation as follow..
To send an email the sender must find a value (called a nonce) such that when some information (like the recipient’s address, the date, the nonce and a counter) is hashed, the hash has a certain number of leading zeros. The sender hashes the string and looks to see if the hash output begins with a certain number of zeros. If it doesn’t, the sender changes the counter and tries again. The sender repeats this until a suitable hash is found and then attaches this “stamp” to the message. The receipient stamp, hashes it, and checks whether the hash meets the required difficulty (ie, correct number of leading zeros).
(Yes, you are right, this is at the heart of Bitcoin’s proof-of-work.)
Hashcash thus delivers stamp that is fast to check but slow to generate which in turns means that spammers must do a lot of work for every message, making scale abuse expensive, whereas normal people sending emails now and then wouldn’t notice thre overhead.
Alex’s suggestion was that something like this be attached to all content
Snippings 