The uses and limits of financial cryptography: A law professor’s perspective

Abstract

There is considerable support in the cryptography community for the “Cypherpunk Credo,” defined as: “Privacy through technology, not legislation.“ Much discussion to date has assumed that the U.S. government’s opposition to strong cryptography, such as its key escrow proposals, is the primary obstacle to widespread use of anonymous electronic cash. For purposes of this paper, I assume that strong cryptography is legal and readily available. Even in that event, I claim that strong cryptography will be used to preserve anonymity only in a highly restricted subset of financial transactions. Furthermore, because technology often will not assure privacy, legal rules can and should play an important supplementary role in the protection of privacy in financial transactions.