Two months ago – during my enquiry to look in to the development of electronic wallets – I stumbled upon Mintchip: MintChip/Bitcoin: no processor role between payer and payee.


The Royal Canadian Mint has pulled the plug on its MintChip cloud-based digital currency and is looking to offload the business.

Reading the headlines it is easily concluded that the end of Mintchip is very near. Reading the bylines there is still a possibility Mintchip will be picked up by an other party.

payment flows revisited.003 wallet chain

Topology payment chain Mintchip

While I had reservations on the dependency for dedicated chips to carry the digital currency from the start the concept it self I find highly interesting. The topology of the payments chain it allows for is a blueprint for a workable digital currency P2P setup. Especially the gateway concept opens up payments for a truly networked environment.
Studying the Mintchip topology in relation to the traditional payments chain and the reversed flow has provided

payment flows revisited.002 aplle wallet

Reversed flow

quite some useful insights in existing practices. Even when Mintchip in particular or cryptocurrencies in general will not fly in the foreseeable future they provide a scrutinizing mirror to reassess the mainstream payment methodologies of today. (see also: PAAS gateway to MintChip or Ripple-like transaction networks?)

Mintchip and cryptocurrcies urge us to better understand how money and payments relate to each other. We have taken both for granted as separate topics; but they are like two sides of the same coin (pun intended): the development of money and payments go hand in hand.

[pullquote align=”right” textalign=”center” width=”40%”]See also: Evolution of currency predicts path (r)evolution of digital money[/pullquote]

An other reason Mintchip is of interest is that it entails true digital currency i.e. digital cash. It has the possibility to exchange value P2P without the need to have third party (technically) involved and can be passed on indiscriminately again without the involvement of third parties. Just like cash. The payment is the exchange of the coin / money.

This is a fundamental difference with huge consequences as compared to other types of electronic payments. These payments in a technical sense do not exchange money between the payer and the payer at all. The payer and payee and the individual transaction are dependent on third parties. Mintchip CS breaks down this interdependency. This interdependency is paid for by pelican/gatekeeper profits by all involved in the payment chains at the expense of payers and payees. Mintchip c.s. promise a way to arbitrage this lock in.

Let’s hope Mintchip is able to find a new home.

Series on electronic wallets