Trust in electronic markets: The convergence of cryptographers and economists (originally published in August 1996)
Authors: Reagle Joseph M. Jr. 
Published: May 2013

This paper is included in the First Monday Special Issue #3: Internet banking, e-money, and Internet gift economies, published in December 2005. Special Issue editor Mark A. Fox asked authors to submit additional comments regarding their articles.
This paper was certainly a creature of its time. A decade ago the Internet bubble was receiving its first puffs of exaggerated exuberance. For me, this time was also informed by Barlow's A Declaration of the Independence of Cyberspace and more importantly, May's Crypto Anarchist Manifesto. The Internet and the anonymous cryptographic markets that would evolve upon it were immensely exciting. Or, at least their potential was exciting; the vision has yet to be.
This text was based on my Master's thesis, which in addition to material found in First Monday also included a protocol for managing trust in information asymmetric relationships via a cryptographic security deposit. The protocol was accepted for presentation at a USENIX conference, but I, nor anyone else to my knowledge, have ever used such an instrument. I continue to buy things over the Internet with a simple credit card; thoughts of digital cash and micro payments are distant memories.
However, the themes of this article are still relevant -- even if some of its inspirations are not. If one is interested in the question of trust, what it is, and how it relates to expected values or financial instruments, I hope the work is still of use. And trust is but one aspect of a theme that continues to be much discussed: social relationships. From digital reputation, to social protocols, social networks, and now social computing -- though this label too seems to be fading -- a prevalent question continues to be how do we replicate and augment social relations in this technologically mediated space? The expectation that this could be done with cryptographic systems may now, 10 years later, seem overly ambitious. Indeed in their 2000 book The Social Life of Information John Seely Brown and Paul Duguid cite this paper when they asked: "Can it really be useful, after all, to address people as information processors or to redefine complex human issues such as trust as 'simply information?'"
Perhaps, in the next decade we will see widespread computerized reputation markets. Or, maybe they are already here, with things like Amazon's book ratings, rankings in the blogosphere, and collaborative filters. First Monday continues to provide analysis of this compelling space, but, in considering this article, it also reflects how we have changed in our ways of thinking about it.
Relative to information security and electronic commerce, trust is a necessary component. Trust itself represents an evaluation of information, an analysis that requires decisions about the value of specific information in terms of several factors. Methodologies are being constructed to evaluate information more systematically, to generate decisions about increasingly complex and sophisticated relationships. In turn, these methodologies about information and trust will determine the growth of the Internet as a medium for commerce.