Cryptology, Digital Assassination and the Terrorism Futures Market

A recent news item indicated that the US Government had been planning a website that would enable people to place bets on the likelihood of terrorist events. It was hoped that a study of market trends would enable intelligence agencies to anticipate and prevent such events.

The idea was mooted by Admiral John Poindexter, head of the Total Information Awareness Program and bears some resemblance to a scheme mooted by Jim Bell. Bell, an MIT graduate had proposed a scheme which uses cryptography and the Internet in order to eliminate corrupt public officials. His scheme rewards those who correctly predict the date of death of such officials. However, the identities of the successful predictors were to be kept secret by using public key encryption methods. Bell claims that his scheme, if universally adopted, would lead to the elimination of government itself. Society would regulate itself by the threat of assassination of those acting inimical to its interests. No other regulatory mechanism, he claims, would be required.
This paper attempts to understand Jim Bell’s concept which requires some knowledge of cryptology. It briefly discusses some concepts in cryptology and electronic banking which are essential to the working of the scheme. It also discusses the Iowa Electronic Markets which have been fairly successful in predicting US Presidential elections. It uses an approach similar to that proposed by Admiral Poindexter’s group. The paper analyses the practicality of both Bell’s and Poindexter’s schemes.