Sunday, October 02, 2005 

Next Generation Moolah

IBM developerworks recently issued a new Power Architecture challenge (as they are wont to do every month), asking:

When it comes to money, the U.S. is notoriously behind the times. I'm not talking about currency policy or central bank management -- I'm talking about the physical bills and coins that we use to buy groceries and coffee. Other countries have all sorts of pretty colors and holograms and Braille-what-have-you on their currency -- the U.S. is just starting to move in this direction. If you were starting your own country, what would your money look like? What sort of high-tech features would it incorporate to protect against counterfeiters and thieves? Would it contain RFID tags? (We're guessing at least one of you will say "yes" to that last one.)

This is my entry:

Interesting question. I have recently had delusions of having my country to design a currency for, so really timely ;-)

Ok, so though ideally I would have everything electronic, and just a card which can be used at all retail locations, which will be required to have EFT (electronic fund transfer) facility, I do believe regular old cash transactions, untraceable and anonymous, have a necessary place in society. So my solution would be less hi-tech than that ...

First thing I will change is the size of the currency notes: I have never understood why currency notes have to be so big, when everything we design to hold them is so small. One thing the US did get right was to have the same size for all denominations. I will take that idea further and have one size for all denominations: the same size as a standard business card. All currency clips, wallets, pockets etc are designed to safely hold business cards, but one invariably needs to fold currency notes to fit those inside (I never met anyone who found it necessary to fold a business card, atleast not one he/she wanted to hold on to). Bringing the size down will eliminate the need to fold the notes, thus increasing their life span.

These would be printed on the virtually indestructible vinyl (I think that's what its called) stock, and would come in different colors and graphics for different denominations. The production would be cheap as there would be no security features associated with the stock itself, or the printing process. The notes will only incorporate one security mechanism: they will contain a tiny smart chip, like in sim cards, with four pins: two for power, one for clock and one for data. This chip would have a unique serial ID and the notes "value" un-erasably burnt into it. The note would have four parallel conducting 1cm wide horizontal strips running all across its length, each connected to one of the chip pins. (yeah, well, that does mean it would not be a *plain* vinyl stock).

There would be tiny, inexpensive, battery powered devices available, looking like paper staplers (like the Red one in Office Space, only smaller)...which could just clip on to the note and quickly authenticate the note using public key cryptography (the chip on the note having a built in tiny PKC encryption/decryption engine), just checking for correct key and obtaining a denomination value. Banks or larger establishments would have "online" payment terminals which would go the next step and actually check the note serial id against a central database for authenticity/expiry information.

Yup. That's it.

What do you think? What would you want in a "better" currency? Add comments below with your thoughts.

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