Question: In Electronic cash payment (i) a customer withdraws “coins” in various denominations signed by the bank (ii) the bank has a database of issued coins (iii) the bank has a database of spent coins (iv) the bank cannot trace a customer

Answer:

In electronic cash payment systems, the following aspects apply:

(i) A customer withdraws "coins" in various denominations signed by the bank: Electronic cash systems involve the issuance of digital tokens or "coins" by the bank to customers. These coins are cryptographic representations of monetary value and are signed by the bank to ensure their authenticity.

(ii) The bank has a database of issued coins: The bank maintains a database or ledger that tracks the issuance of digital coins to customers. This database keeps a record of the coins in circulation and their respective ownership.

(iii) The bank has a database of spent coins: When customers make electronic cash payments, the bank keeps a database of spent coins. This database tracks the transactions where the coins are transferred from one party to another.