Financial Transaction Models in the Electronic World

We present a cryptographic protocol for securing electronic commerce over the Internet. The protocol reflects existing transaction models in two respects: (1) it uses only traditional parties to complete a financial transaction and so the transaction cost is kept low; and (2) it preserves some important features of the conventional transaction systems, which have been the key elements for the conventional systems to thrive. We will reason the importance of these properties for electronic commerce over the Internet. 1 Introduction Nowadays, many financial institutions realise that a cryptographically enhanced communication means over the Internet (e.g., the world wide web) can form a new dimension for facilitating on-line financial transactions (credit-card or cheque payments). The electronic transactions have obvious advantages over the traditional transactions, not only in terms of cutting-off costs in manufacturing, shipping and managing the physical material, but also in terms of s..