PsiTraveller wrote: ↑Sat Oct 01, 2016 5:59 am
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I am interested in this because across the Sindal sector, where the 2nd edition game is focused, there is little Imperial Presence. There are Starports (a lot of them GeDeCo), there are a few Navy ships. But there will not be a centralized banking infrastructure. So ships may well have cases of cash on them, raising the stakes for theft and piracy. I am trying to figure out a way to reduce the risk for ships and increase a safer type of trading/banking system.
Although there may be little Imperial presence, it's close enough to the Imperium that the Imperial Credit could be the standard currency. In the real world, any time a nation has been in a state of economic chaos such that their own currency was distrusted, major country currencies – US Dollars, Euros, etc. – have been favored over the local currency.
Before the Euro, the US Dollar was widely used in Europe as a medium for international exchange, even though there were plenty of respected European currencies to choose from, simply because it avoided issues like a French business and a German business arguing over whether to price a deal in Francs or Marks. I seem to recall reading in the 1980s that there was more US cash (in dollar volume, mostly in $100 notes) in Europe than in the US, because it was immune to political squabbles between European nations.
Based on that, I would expect that the Imperial Credit would be the standard currency of trade well outside the Imperium – probably well outside the region in which the Imperium would have any other influence – except in places where it was politically toxic. So trade deals might well be priced in Imperial Credits deep into
Gzaefueg sector, two sectors from the Imperium, but maybe not in
Cronor subsector, just outside the Imperium.
Bitcoin might do the trick, convert everything to encrypted data and banks accept it. The issue that might happen there is a Free Trader depositing 1 million in cash to a bank and getting bitcoin. The Free Trader leaves the system, taking 1 million in bitcoin as data. There are still a million Credits in cash in the bank. Technically the assets have left the system. Does the bank destroy those notes, or is the money magically doubled and lent out as cash again to another Trader?
The way Bitcoin type currencies work is that a bank might have a million Credits worth of Bit-credits in its electronic "vault", and when the trader arrives they exchange a million Credits in cash for the million credits of Bit-credits. Neither cash Credits nor Bit-credits are created or destroyed.
locarno24 wrote: ↑Tue Apr 18, 2017 10:56 am
There are and have always been means of encryption resistant to any 'brute-force' decryption.
Modern mathematical encryption uses mathematics and ludicrously high prime numbers, but old-style 'codebook' ciphers like a one-time pad (at a basic level 'replace a word or phrase with the page, paragraph and word number to locate that word in a book unknown to anyone outside those two parties') do not.
They have their own risks - namely that you have to convey a copy of the codebook to both ends of the transmission without it being intercepted - but if it works, and a mathematical approach does not, the bank will suck it up and hire a merc gunship to make a tour of its branches with the new key file.
Good point about one-time pads. They're both mathematically resistant to all means of decryption other than stealing the code-book and good for adventures related to the security of the code-book.
Ultimately, banking is in the same situation it was in in the 18th/19th century; technological encryption didn't work then (because it hadn't been invented yet), Biometric validation impossible (same problem), instant communication wasn't available, and 'checking up' on a letter of credit between Europe and various colonies could take weeks or months.
Nevertheless, letters of credit between established banking houses were made to work then, and whilst fraud no doubt occurred, the banks which stayed in business (and in some cases are still in business today) were smart enough to keep it within fiscally tolerable levels.
Exactly. Long-distance banking dates back long before fast communications or advanced security. It operated on trust relationships, letters of credit, and the threat that defrauding people powerful enough to operate long-distance banking would have unpleasant consequences to anyone who tried to cross the bankers.