GNU Taler begins operating in Switzerland, distributed by the Taler Operations AG. Gnu Taler aims to be a “digital wallet” and has been used by the swiss national bank as well as the european national bank as a example for how a digital currency handed out by the state could work. It aims to be as privacy preserving as cash for the buyer while not allowing the seller to evade taxes.
Currently the Taler is brought out by a special organisation, the “Taler Operations AG”, and not the national bank, although both the national bank as well as the Taler Team have shown interest in a official digial currency by the national bank based on the Taler. But we need to relativate as the national council has stated that the introduction of a digital currency would probably take relatively major legislative changes and therefore take a bit of time.
I looked at this a looong time ago, but the basic idea is that the tokens (equivalent to cash coins/banknotes) are generated on the end user’s device, through some public-key cryptographic back-and-forth protocol. The issuer (bank/central bank/payment provider) does not see these tokens (they’re only on the end users device), but can verify that they’re legit (i.e. issued by them) somehow.
You can take one of these tokens to them, and deposit it in an account. They won’t know who it’s from but they know it was legitimately issued by them. Depositing a token is also supposed to be the only way of figuring out if it is a legit token, the bank will not tell you if a token is legit unless you deposit it.
When someone pays with these tokens in a shop, the shop will want to immediately (during checkout) deposit them, to make sure they’re legit, and also to make sure the token hasn’t been double spent. A shop that doesn’t do that makes itself vulnerable to fraud. This means shops will have a hard time hiding their revenue (to dodge taxes) compared to cash.
If someone you trust gives you a token (birthday money from your grandma, say), you don’t have to immediately deposit said token, since presumably you trust your grandma to not give you fake or double-spent tokens. Since you trust you grandma, there is no need to deposit the token and involve the bank, and that transfer would be untraceable (it’s literally just copying a number from her phone to yours).
The idea is that shop owners would have a hard time dodging taxes without opening themselves up to fraudsters using fake tokens, while the customer cannot be identified. You’d also be able to exchange tokens with family and friends in a way that isn’t traceable, as long as you trust them to not screw you over.
What is the relationship of fiat currency to tokens? is it €1:1 token?
The tokens can be worth different amounts. There can be 1 ¢ tokens, 10 ¢ tokens, 1 € euro tokens, 10 € tokens, whatever. Your wallet app will, when withdrawing, generate various tokens worth different amounts.
Using those tokens will be somewhat like paying in cash at a store that does not return any change. You gotta pay the exact amount. In order to facilitate that, you’d withdraw tokens worth only small amounts. There wouldn’t be like be any 50 € tokens in practice. If you wanted to withdraw 50 €, you’d get 1000 1 ¢ tokens, 100 10 ¢ tokens, and the rest 1 € tokens or something like that, to make sure you always have the exact amount ready to pay for anything.
Thats not true I think. Taler is able to anonymously give “change money”. https://youtu.be/fY-DWLHVLk4?t=2380 (39:40 timestamp)
Dude, I assume my grandma has absolutely been scamed, and her birthday money is basically as valuable as Trump coins
I’m expecting that if she has been scammed and her token was stolen, you can report this token to the police and they might be able to ask the banking system in which account was this token deposited, to hopefully trace the scammer back.
If so, this looks safer than the scams that ask grandmas to get giftcard codes.
But that’s assuming that the token was obtained from grandm’s bank and not that the grandma paid a scammer in some other untraceable way to obtain a fake token from the scammer. That would be a different kind of scam.
Then you wanna deposit it immediately to find out, like a seller does
iirc they did have some mechanisms to prevent token fraud but I honestly can’t remeber how it was implemented.
Great write up. Thank you.
Can you find the link from where you originally got this information?
Go on the official Taler Website, they have all the info there iirc
What happens to my funds when my phone is lost or stolen?
If you don’t have a backup then you’re likely out of luck. But that’s better than cash, where you can’t make a backup
Depends on threat model, eg police will seize phones/computers/devices all the time but will only seize money if they think it’s related to a crime. As long as you’re not being arrested for a money-related charge then your cash would most likely be untouched but your devices will be lost. But of course that issue is circumvented with just off-site backups which are probably just as safe as your cash if cops aren’t interested in your cash.
If the cops steal my USB drive with my encrypted bitcoin wallet, I just restore it from the backup and they’ve stolen nothing.
In the US, cops steal cash all the time. Sometimes tbeh steal it personally, but they have an incentive to “legitimately” steal it to add it to their budget. Its fucked.
Fair, I don’t live in the US and IME cops haven’t stolen my cash, although tbf I’ve not really had cash lying around when raided or arrested.
Well thats their logic. If you have a lot of cash lying around, they immediately recognize it as an anomolu and therefore assume you’re guilty and the money is illicit.
Its completely legal to not trust banks and keep your savings in cash instead (or some ratio per your risk appetite), but cops generally don’t care about laws.
How would other types of taxes, like in you example, gift tax, be handled?