With a seemingly infinite amount of knowledge available to us at the tap of a smartphone, we all take digital information for granted. But when it can be replicated at zero cost, how do the economic laws of supply and demand work, especially in the context of using digital currency?


In his new book Digital Cash, Finn Brunton, assistant professor in the Department of Media, Culture, and Communication at New York University, explores how the pioneers of cryptocurrencies have radically shaped the world we live in, and discovers a world of political radicals and technological utopians.

In this extract below, we learn of Phil Salin, who used the power of economics to pursue a mission to space and had a bold plan for creating a pre-internet network for trading digital information. He was also one of the first to have his head cryogenically frozen, to be thawed when his vision had become a reality – needless to say, he’s still waiting.


Phillip Salin lived at one end of a road a hundred miles long: it ran straight up from anywhere he stood to outside the planet’s atmosphere. He mapped out a trajectory from Palo Alto to low Earth orbit. His team at Arc Technologies—later Starstruck, as in “a truck to the stars,” and finally the American Rocket Company under new management—experimented with sugar-based “rocket candy” fuel for less expensive launch vehicles and lived off funds invested by Michael Scott, the first CEO of Apple Computer. Salin wasn’t an aerospace engineer, though; he was an economics wonk with an MBA, a devotee of the market-centric Austrian School economist Friedrich Hayek, a believer in the power of market operations alone to drive change. Salin thought the greatest challenge the space future faced was a force more powerful than gravity or the strain tolerance of metals: misallocated money.

The Shuttle was too cheap, he argued before a congressional committee: its costs were subsidized and artificially depressed, discouraging the entrepreneurial rocket industry. The movement of money alone could get us out of the gravity well: “The next great breakthroughs in space will be economic breakthroughs,” he testified. Salin was fascinated by marketplaces for information, by the circulation of money and knowledge—money as information, and information as money.

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In 1984, as the business of space was running into trouble, Salin started a project he had been contemplating since the 1970s, when he was reading Hayek and Karl Popper and working on time-sharing computer systems: a digital marketplace for intellectual property. He called it the American Information Exchange, AMIX, envisioning it as a place to retail all kinds of brainwork. It would provide you not merely with information but with answers: surveys, market analysis, patents, floor plans, CAD renderings, solutions to problems, formulas. “We’re just trying,” Salin said, “to reduce the friction and transaction costs that keep people from trading their knowledge for gain.”

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To do this, they had to build an auction and sales system with profiles and ratings and comments and market managers for the new profession of “information broker.” They needed a platform to handle accounting and billing and transactions and payments. They needed personal computers across the United States running the custom AMIX software (which even a puff piece described as “cumbersome”) so every customer could dial into Unix servers storing an array of topics, subtopics, and items encompassing the whole specialized world of potential information products and services. The team at AMIX, as the technology journalist Doc Searls recalled, was “trying to create an online service from scratch,” a bespoke version of the whole infrastructure the Internet itself would later provide. “Phil had to create his own Internet.” Prior even to solving those problems, though, AMIX had to explain why digital information was valuable.

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Esther Dyson put the objection simply in 1990: “The law of supply and demand can’t work for a product, such as information, that can be replicated at almost no cost.” Dyson was then primarily an industry journalist for the computing boom and an advocate for the development of digital information marketplaces. There was a problem with these potentially perfect cyberlibertarian markets, and it lay at the heart of Salin’s business plan. Dyson wrote repeatedly about AMIX, trying to answer the recurring objection about the value of digital media: “Once it is created, it can be replicated almost costlessly.”

Back in 1972, the peripatetic writer and artist-activist Stewart Brand—of the Whole Earth Access Catalog, among other ventures—spent time with the subculture of “computer bums” writing code and playing an early video game called Spacewar! He laid out the implications of digitizing analog media with the clarity of dawn: “Since huge quantities of information can be computer-digitalized and transmitted, music researchers could, for example, swap records over the Net with ‘essentially perfect fidelity.’ So much for record stores (in present form).” His phrasing is inapt in an important way, a mistake of semantics we continue to commonly make today. His musicologists aren’t “swapping” records, trading them back and forth—they’re making records, since each copy (on my computer, on yours, stored on the server, in local cache storage, on a music-playing device) is a perfect bit-for-bit copy unless we do something deliberate to filter, compress, or alter it.

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Much of the technical history of computing and telecommunications in the twentieth century is the history of the challenge of fidelity, of accuracy and error correction: to store and transmit perfect copies using imperfect media and noisy channels, from telephone lines to radio waves to the wiring between a single computer’s storage, processing, and display. The work of computing, especially networked computing, can be told as the creation of a global era of copying machines whose capacity for replication far exceeds printing and photography. The facing page of Dyson’s column on AMIX in Forbes was a full-page ad for Xerox, celebrating a “National Quality Award” in its role as “The Document Company”: like Konrad Zuse’s earliest computer programs, which used digital instructions punched into old 35 mm movie film, here two different media systems were neatly juxtaposed.

This was another step in the ongoing, multicentury crisis of the concept of “intellectual property”; the digital turn enabled new answers to the old questions of how and why and in what ways information is valuable. Salin’s answer, in the framework of AMIX, had a deceptive, market-driven simplicity: digital information is valuable because people will pay for it. Who knows which information and why? “Juan’s common knowledge is Alice’s electrifying discovery,” Dyson wrote in one of her essays on the AMIX idea. “Let the market decide.” But this answer included a deeper question. AMIX was indeed a marketplace: a transaction and payment platform for digital information. “Digital information” was coming to include money itself, the thing paid. What made the digital money of the digital marketplace valuable?

The same mechanisms that enabled the transmission and storage of information as a swiftly verifiable string of bits, moving from account to account, put the money thus transacted on the thinnest ontological ice. Tim May pointed out that you could use steganographic techniques (concealing some data within other data) to hide a fortune in digital cash in the file of a song or a high-resolution image. A banal digital photo could hold a whole armored car full of cash. But the cash was of the same stuff as the photo and had the same fundamental problem of duplication. Dyson had argued for AMIX on two grounds: digital information was free to replicate in general but costly to find in particular, and the most valuable data tends not to be widely available. How would that work for the kind of digital media that we call money?

Salin did not live to see what became of these projects, dying in December 1991 of liver cancer at 41, shortly after AMIX was acquired by the computer-aided design (CAD) company Autodesk. He became the fifty-ninth person to undergo controlled cryonic suspension, having a “neuro” procedure—his head removed and frozen to be recovered by the society he anticipated, with his brain revived or digitally reconstructed and his body cloned or prosthetically replaced. He discussed one of the problems this raised with May: how to move your assets forward through time with you to immortality. If it was challenging to accurately price the Space Shuttle, and difficult to securely transact payments between people on the American Information Exchange, imagine transmitting money into an unknown and unrecognizable future in which you yourself have been “deanimated,” frozen in a cask in Arizona, and recovered in some posthuman format.

May’s notes from 1993 on “timed-release cryptographic protocols,” theoretical methods for encrypting a message so it can only be read after some length of time or a specific event, presented the first use case from a discussion with Salin years before: “Foremost, to send money into the future, while protecting it in the meantime from seizure, taxation, etc.,” a matter of interest “to cryonics folks who want to arrange for their own revival/reanimation at some time in the future.” (A decade later, Julian Assange would take up the same question on the cypherpunks list, but for securing the release of secrets.) It would be a future-proofed bank account and could offer a reward for resurrectionists: the first group to bring the account holder back to life gets a promised prize once the data is decrypted. It would be the ultimate score for the information brokers of the future Salin wanted to create: a pricing system for bringing its own creator back from the dead.

Digital cash: The Unknown History of the Anarchists, Utopians, and Technologists Who Created Cryptocurrency by Finn Brunton is available now (£21.00, Princeton University Press)


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