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Electronic lottery tickets as micropayments

By Ronald L. Rivest

Abstract

Abstract. We present a new micropayment scheme based on the use of "electronic lottery tickets. " This scheme is exceptionally efficient since the bank handles only winning tickets, instead of handling each micropayment. 1 Introduction We present a paradigm for micropayments: probabilistic payments with "electronic lottery tickets. " The probabilistic nature of lottery tickets makes payment of small values simple. For example, an electronic lottery ticket for a $10.00 prize with a 1/1000 chance of winning has an expected value of one cent. A user can pay a vendor one cent by giving the vendor such a lottery ticket. With conventional payment schemes, a bank or broker must process each payment: the bank issues each digital coin, and processes it again when it is redeemed. Electronic lottery tickets are the first payment scheme in which the bank does not have to process each payment, since the bank only sees the "winners. " From a bank's point of view, lottery tickets are significantly more efficient than all previously known micropayment schemes

Publisher: Springer Verlag
Year: 1997
OAI identifier: oai:CiteSeerX.psu:10.1.1.135.2668
Provided by: CiteSeerX
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