Say that many banks issue electronic cash of a particular type.

If there is a malicious bank and user collusion, the malicious bank signs electronic cash for a particular user. This user then takes the electronic cash to other banks to withdraw money. This way the malicious bank can get a large amount of cash from other banks.

Can such a multi-bank electronic cash system be established only if it all banks do not act maliciously?

Related multi-bank electronic cash papers: Fair Electronic Cash Systems with Multiple Banks

A New Certificateless Electronic Cash Scheme with Multiple Banks Based on Group Signatures

  • $\begingroup$ What's your question? $\endgroup$ – AleksanderRas Apr 26 '19 at 13:34
  • $\begingroup$ In the multi-bank electronic cash system, if the malicious bank mentioned in the question exists, then I think such a system is not safe, I don't know if my idea is correct. But I haven't thought how to refute my point of view, so my question is, is my idea correct? If not, how can I prevent the malicious bank I mentioned? @ AleksanderRas $\endgroup$ – Staizita Apr 26 '19 at 13:43
  • $\begingroup$ Your premise is that there are two banks, of which one, say Foo Bank, can unilaterally print unlimited foo dollars, and the other, say Bar Bank, will exchange foo dollars for US dollars at a predetermined exchange rate? It sounds like Bar Bank was foolish to make the decision to do this business without first establishing some verifiable limit on the money supply of foo dollars, or unless there are social pressures like a stable economy in a cohesive society to discourage Foo Bank from wrecking the financial system this way in the first place. $\endgroup$ – Squeamish Ossifrage Apr 26 '19 at 14:46
  • $\begingroup$ @ Squeamish Ossifrage No!Instead of different banks issuing different e-cash, all banks form a group to issue the same e-cash (using group signatures), which users can use to exchange dollars from different banks. But the original text does not mention that all banks must be good, so I think that if there is a bad bank, issuing electronic cash, and changing dollars from other banks, then I think this system is not safe. So my question is, does such a system have to default that all banks are not malicious? $\endgroup$ – Staizita Apr 26 '19 at 15:11
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    $\begingroup$ @Staizita In the papers you cited, there is a central bank that issues currency to the various other banks, presumably in limited volumes. The innovation of Bitcoin was to do away with this central bank by using proof-of-work to distribute limited currency issuance. $\endgroup$ – Squeamish Ossifrage Apr 26 '19 at 15:42

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