How Cryptography Redefines Private Property

What is Property?

Plato (427–347BC) and Aristotle (384–322BC)

Public-Key Cryptography

Until recently, the development of cryptography has been driven mainly by wars and rivaling states.

  • The invention of the telegraph dramatically increased the amount of data that needed to be secured
  • The invention of the radio heightened the need to encrypt public communication channels, as opposed to relying on stealth methods
  • The invention of the computer brought incredible computational power to cryptanalysis; breaking codes became much easier
End of an era: the Enigma machine — image by LukaszKatlewa, CC 3.0

Privately-Owned Digital Goods: An Oxymoron?

The arrival of the personal computer and the Internet introduced a new asset class: digital goods. Digital goods are intangible digital bits of information, packaged in various encoding formats. Examples are Wikipedia articles, MP3 files, software, etc.

  • Scarcity: the ease of reproducing and redistributing digital goods in unlimited quantity is precisely what makes exclusive ownership difficult.
  • Transferability: the ability to dispose of an asset by sale is a crucial component of ownership. Without this, ownership loses much of its power.
Digital signatures using public-private key pair — image courtesy of Wikipedia, CC 4.0


Special thanks to Jimmy Song, Hasu, Nic Carter and Steve Lee for their extremely valuable feedback.



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