CyberCash: Early Internet Payment Pioneer

 

• Foundation and Founders: CyberCash was founded in August 1994 by Daniel C. Lynch, William N. Melton, Steve Crocker, and Bruce G. Wilson. It was headquartered in Reston, Virginia.
• Services Provided:
  • Initially, CyberCash provided an online wallet software for consumers and software for merchants to accept credit card payments.
  • They later introduced “CyberCoin,” a micropayment system inspired by the NetBill research project at Carnegie Mellon University, aimed at handling small transactions efficiently.
• Technological Contributions:
  • In 1995, they proposed RFC 1898, known as the CyberCash Credit Card Protocol Version 0.8, which was an attempt to standardize secure transactions over the internet.
  • They also dealt with the complexities of the U.S. government’s temporary restrictions on exporting cryptography by obtaining an exemption, acknowledging the difficulty in extracting the encryption from their software.
• Business Journey:
  • CyberCash went public in February 1996 with the stock symbol “CYCH,” experiencing a significant rise in share value on its first trading day.
  • The company acquired ICVerify in 1998 and Tellan Software in 1999 to expand its offerings in credit card processing software.
  • They faced significant challenges, including a reported hacking incident in 2000 by a hacker named “Maxus,” though CyberCash denied the claims. They also struggled with the Y2K bug, where many users of their ICVerify software experienced double billing issues at the start of 2000.
• Bankruptcy and Acquisition:
  • CyberCash filed for Chapter 11 bankruptcy on March 11, 2001.
  • Subsequently, VeriSign acquired most of CyberCash’s assets and name, except for ICVerify, which was not part of the deal.
  • By November 21, 2005, VeriSign’s payment services, including what was left of CyberCash, were acquired by PayPal, which was already a subsidiary of eBay at that time.
• Legacy: Despite its ultimate failure and bankruptcy, CyberCash played a significant role in the early days of internet commerce by attempting to provide secure payment solutions, which helped pave the way for future developments in online payment systems.