Paying online: the commercial attempts

While the cypherpunks theorize a stateless currency, another story is being written in parallel, on the commercial side. From the mid-1990s, online commerce explodes and demands a way to pay. Solutions multiply, but they all share the same flaw in the eyes of a future Satoshi: they rely on a trusted third party, a central company that can see everything, block everything, and lose everything.

CyberCash (1994), based near Washington, is one of the pioneers. It offers merchants a way to accept bank cards online, and even launches CyberCoin, a micro-payment system, followed by PayNow, electronic checks. But it depends entirely on banks and card networks; it goes bankrupt in 2001, its assets bought by VeriSign. cybercash.com, 1997 archive.

e-gold (1996), founded by Douglas Jackson, goes further with a fascinating idea: a digital currency backed by physical gold. Its slogan says it all, "e-gold... gold itself, circulated electronically," gold itself, put into circulation electronically. It is the gold standard transposed onto the web. e-gold enjoys enormous success, then becomes a haven for fraudsters; because it is centralized, and therefore seizable, it is prosecuted by the US government for operating as an unlicensed money transmitter, and shut down in the late 2000s. e-gold.com, 1999 archive.

X.com (1999) is an online bank founded by a young entrepreneur freshly enriched by the sale of his first company: Elon Musk. Its team page from November 1999 introduces him as "Chairman and Chief Executive Officer," crowned by the sale of Zip2 to Compaq for 305 million dollars. In 2000, X.com merges with Confinity, the start-up of Peter Thiel and Max Levchin developing a payment product named PayPal. The company is renamed PayPal in 2001, acquired by eBay in 2002, and will become the trusted third party par excellence of online payment. x.com/management.html, 1999 archive.

By around 2007, a handful of players lock down online payment: PayPal, Visa, Mastercard, American Express. All rely on the same model and take a fee on every transaction, often 1 to 5%, which makes very small payments impossible. The loop closes in 2008. The very first sentence of the Bitcoin whitepaper targets exactly this world: "Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties." Online commerce came to rely almost exclusively on financial institutions serving as trusted third parties. CyberCash, e-gold, PayPal: three ways to solve digital payment, three times a central intermediary that could censor, freeze, or collapse. Bitcoin defines itself, from its first line, against them. A curiosity: Elon Musk will buy the x.com domain back from PayPal in 2017, and rename Twitter to "X" in 2023. An anecdote that will resurface: 2008, the year of Bitcoin's birth, was also the year Musk came close to bankruptcy, which makes him a recurring Satoshi candidate. The Musk trail.