Serializing Financial Paper - CUSIP

My proposed Digital Dollar (DD) money system has its foundation in identifying each single dollar in the digital system with a uniquely serialized number.  That dollar is a fixed record always related to a uniquely identified owner that is a registered financial entity user of the system.  Money as a medium of exchange performs its function when the identity of the current owner of the dollar is changed to the identity of the new owner.  This action is applied to as many dollars as necessary to equal the amount of the transaction.

It is the total amount of the transaction that is of foremost importance to the buyer and seller.  The mechanics of how the money changed hands in the computer network is of relatively little importance to them as long as it gets done and there is proof that it is or has been done.

For money system management the (back office) mechanics of how money changes hands as a function of a well designed conceptual system is extremely important.  I believe that a well designed system depends on serializing every single dollar unit of value in the system.

Serialized dollars are not new.  Pull a dollar bill out of your wallet.  The serial number on that bill is unique.  No other bill has the same number.  A dollar bill of any denomination larger than 1 is merely a more convenient way to carry a hundred one dollar bills.  This convenience is not necessary when dollars are digitized.  They all have a value of one dollar.  Computers do not find it difficult to handle large numbers of large or small numbers.

A serialized dollar bill is a financial piece of paper.  The serialization as well as other unique features in, on and about the paper give it authenticity.  Digitize the dollar and all those features are lost.  What gives it authenticity is its existence in the balance of an account and the fact that it entered the account in an authorized manner regardless of the total number amount of dollars entering it.  Once authorized for entry into the total system of  digital accounts in the financial system each dollar retains an inherent authorization to be traded among authorized digital accounts without the need to carry a unique identifying authorization serial number.

While serialization of financial paper called dollar bills is declining (3% of the money supply) in this digital world.  Unique serialization authentication of individual near money financial paper instruments has managed to leap from the old school paper world to the new digital world where the concept remains alive, well and thriving.

CUSIP Global Services is in the business of serializing commercial financial paper documents.  CUSIP:  Committee on Uniform Securities Identification Procedures.  This is how CUSIP describes itself at its website:

About CUSIP Global Services

CUSIP Global Services (CGS) is dedicated to driving efficient trading, clearing and settlement in capital markets throughout the world by providing a unique common language for identifying financial instruments across institutions, exchanges and nations. With over 40 years of experience in the securities identification business, CGS is the world leader in developing innovative solutions to reference data challenges.
CGS is managed on behalf of the American Bankers Association (ABA) by Standard & Poor’s with a Board of Trustees comprised of representatives from leading financial institutions.

This is an intriguing thing at the CUSIP website:

Jamaica Stock Exchange to Assign ISIN and CFI Codes

October 4, 2012
Effective October 4th, 2012, CUSIP Global Services hands over responsibility for the assignment of ISINs and CFI (Classification of Financial Instrument) Codes to the Jamaica Stock Exchange for securities in the Jamaican market. The ISINs previously allocated by CUSIP Global Services in its role as substitute National Numbering Agency for Jamaica will remain in effect. Please contact Ms. Riccalya Robb at riccalyar@jamstockex.com for more information. 

ISIN (described by ISO 6166 here) and CFI (described by ISO 10962 here) codes are the unique numbers that are cranked out by the CUSIP computer using their number creation algorithm.  "Hands over responsibility" appears to be a franchising of the production of numbers to a franchisee (Jamaica Stock Exchange). 

By golly!  Every country has their own "Numbering Agency" with a responsibility to print their own numbers in accordance with the established standards.  Wikipedia describes them all here. 

CUSIP Global Services is located at:  55 Water Street, 45th Floor New York, New York 10041

CUSIP has a data base of 9.5 million reference serial numbers assigned to financial documents.  The CUSIP data base: 

Today, CUSIP identifiers are available for more than 8,4 million unique financial instruments issued by corporations, municipalities and government agencies throughout the world

I have seen this same statement at several different sites, this one was from 2009.  The CUSIP site says it is now 9.5 million but does not say that it is the total world wide number. It is a searchable data base at their web site.  They provide their numbering service to government as well as private business entities.

The ISIN (CUSIP Identifier is the numbering scheme for the production of unique numbers to be applied to financial documents.

 CFI (ISO 10962) is the data element table described here used to specify financial data elements that can be associated with the ISIN.  "Ownership is attribute 2 on the data element table with provision for associated restrictions and related to attribute "Shares".

How does this relate to my Digital Dollar Scheme?  It is essentially a system in which the financial digital document is serialized and remains a fixed record while the ownership of the serialized financial object is variable subject to a change in ownership from current owner to new owner.

A new system always has a leg up on explanation as well as implementation if it can be explained in terms of an existing system.  This just might be the best existing system to use as an example of the Digital Dollar system that I propose.


This from LexisNexis:  CUSIP obviously does not have a monopoly on this business of creating and assigning identifiers.

Bonds and stocks usually have a unique identifying number, issued by a clearing house or other agency. In the U.S., this is the CUSIP number (see "CUSIP"). In Europe it is the Common Code, issued in Luxembourg (which replaces CEDEL and Euroclear codes). The Japanese use SICC, the Swiss use Valoren, the British use the SEDOL, the Germans use WKN (Wertpapier Kenn-nummer). To find others, see the list posted at the bottom of the "Definitions" page posted by Ci: Corporate Information (www.corporateinformation.com/defext.asp).