Hal Finney on digital cash traceability

Not what you would have thought!

Happy New Year, all!

This is a short one but something you won’t see anywhere but here in this newsletter.

Craig Wright says a lot of controversial things, but probably the most controversial is the idea that Bitcoin is meant to be traceable.

It sounds scary, 1984-ish, and dammit totally contrary to everything we thought about the purpose of Bitcoin! Right?

I say maybe, maybe not, but this isn’t about me or Craig. It’s actually about Hal Finney.

Revered by the cypherpunks and crypto-anarchists, and often himself the subject of speculation about the identity of Satoshi Nakamoto, Hal seems like the last guy to have made the case for traceable digital cash.

But here’s what I found that Hal wrote about digital cash and traceability in 1994 on the Cypherpunk Mailing List:

…the political point is that if you can make an untraceable payment, you could be coerced into doing so, for example by being robbed at gunpoint. Contrariwise, if the cash system used by you and your bank is such that all money is inherently traceable, it will be a lot harder to commit robbery, extortion, kidnapping, and all those other horrors which people fear will come with digital cash.

That doesn’t sound all that different from what Craig says about traceability, and it actually points to an interesting question: could traceability actually create a freer, less coercive society? Would it actually be a check on bad actors? Is Craig, in fact, Wright?

I don’t think it’s clear, but I think the people who dogmatically dismiss the idea as ‘totalitarian’ or because it’s Craig who said it are not thinking creatively enough, and now we know those people are revising history when they say the question has never been raised before.

That’s all for today. Let me know your thoughts on Twitter or email.


Deryk Magill

P.S. Craig, it might help your case if you didn’t talk so much about sending people to Thai prison!