4.2.5 What are micropayments?
Micropayments are payments of small sums of money, generally in denominations smaller than those in which physical currency is available. It is envisioned that sums of as little as 1/1000th of a cent may someday be used to pay for content access or for small quantities of network resources. Conventional electronic payment systems require too much computation to handle such sums with acceptable efficiency. Micropayment systems enable payments of this size to be achieved in a computationally lightweight manner, generally by sacrificing some degree of security.
One example of a micropayment system, proposed by Rivest and Shamir, is known as MicroMint. In MicroMint, a coin consists of a hash collision computed under certain carefully tuned constraints. By investing in extensive computational resources, a mint may compute a number of these coins, and then sell them in batches. MicroMint exploits the efficiency of hash function calculations: any party can quickly verify the legitimacy of coin. While deriving new coins is hard in MicroMint, it is possible for users to re-spend the same coin or to set up an expensive forging operation. The MicroMint system addresses this shortcoming by presuming that it will not be worthwhile for a user to cheat in this manner.