New Concept for Physically-Secured E-Coins Circulations

Abstract

Electronic Cash (EC) is still suffering from being difficult to transfer values as a digital stream on open channels. The fact that a value stream of bits is often traceable, anonymity and protection against double-spending becomes a very difficult task. In physical cash, coins and bills are exchanged physically persons resulting with assured transport of value by the fact that the physical transfer of money assures no possibility for duplication. Block-chaining technique in Bitcoin attempts to prohibit doubling by majority observation with also a limited success in anonymity and double spending issues. We introduce a new concept for E-Coin circulations by prohibiting the knowledge of the coins to any exchanging party. The only one who knows the coins is the minting authority considered as a trusted authority. The coins are made only possible to identify without being able to see them in critical exchange phases by the exchanging parties, thus prohibiting doubling of coins. The key idea of the new concept is to store the coins in unclonable physical Electronic-Wallets (UEW). The coins can be provably transferred without being seen by users. The UEWs can only be used to verify, accommodate and exchange coins only between wallets under the sole control of the users. Users and manufacturers and even Trusted Authorities TAs have no possibilities to clone UEW and duplicate E-coins. The concept is both bio-inspired regarding unclonable entities and physical-cash-inspired as only the minting banks can duplicate coins and bills. The new E-Coin concept is based on using Physically Unclonable Functions (PUFs) in a new form as digital Secret Unknown Cipher (SUC).