Indeed, GNU Taler doesn't use a blockchain, as a blockchain cannot actually implement digital cash. In a blockchain, transactions are necessarily centralized — on a distributed ledger, but still account-based —, so they are effectively equivalent to wire transfers, i.e., just accounting entries: they cannot take place between two offline parties like you can do with actual cash. Also, blockchain-based digital "money" (quotes because there is no such thing, "cryptocurrencies" are purely speculative securities and that's it) need to be at the same time the currency, the long-term storage, and the transaction system.

On the contrary, GNU Taler is only a transaction system as you said, and uses advanced cryptography (double blind signatures) and infrastructure that allow it to be bearer-based, i.e., actually decentralized transactions between two offline parties can take place. Taler can actually do digital cash, with buyers privacy, and auditability and taxability of sellers.

I’m confused. Why do they say in their FAQ that peer-to-peer payments only appear as such, and actually need to go through a payment provider?

https://taler.net/en/faq.html

My understanding is that a Taler is a "use-once" note - you create it from a payment provider balance, then you can transfer it to someone else, but then that person then has to redeem the coupon, they can't transfer it again (at least not using the cryptographically secure protocol - they could give someone else the private key, but clearly that wouldn't be safe). So transactions in Taler look something like this: 1 convert payment provider balance to Taler note 2 send Taler note to someone else 3 recipient converts receipt back to payment provider balance 4 create a new Taler note (go to 1). The anonymity should derive from the fact that the receipt note can't be traced back to the original spendable note, and the time delay between the creation of the spendable note and the redemption of the receipt note (so arguably the system requires some level of minimum activity to achieve a practical privacy guarantee).

So in that sense it is quite different from the account or UTXO logic that most cryptocurrencies use, where balances can be transferred between accounts indefinitely. I think it's interesting to think about what problems it solves - it semi-solves anonymity in a way that might be acceptable for lawmakers and that doesn't require a backdoor (the more typical approach for 'compliant privacy'). The question is whether that is enough utility gain for regular users to justify the overhead - it seems like a simple transaction requires quite a lot of steps, key management is a non-trivial burden (for users who might not even be used to password managers eg),...

> actually decentralized transactions between two offline parties can take place.

The schema they use to explain the system's mechanisms clearly shows an exchange that needs to be audited:

> Payments are made after exchanging existing money into electronic money with the help of an Exchange service, that is, a payment service provider for Taler.

That is, the transaction can be offline, but it eventually needs to pass through a central point to be effective.

> In a blockchain, transactions are necessarily centralized — on a distributed ledger

This.

4. the central bank gets to decide how much "cash" each individual deserves to have at any given point in time. All of the proposals I've heard set that limit at less than one month's apartment rent in most EU cities. Therefore, this scheme is not competing with any form of money or payment besides coins-and-banknotes.

5. this "cash" has an expiration date, which is chosen at the whim of the central bank. If you stuff it in your mattress like paper cash, it becomes worthless. Therefore, this scheme is a massive step backwards in terms of central bank control over our lives, relative to coins-and-banknotes.

If this takes off, it will affect only a small slice of our economic relations, and it will affect that slice for the worse, not for the better.

I'm disappointed that Tanja Lange was willing to associate herself with this.

You're confusing Taler with central bank digital currencies (CBDCs, the Eurozone incarnation of which would be the Digital Euro). I suppose the project being funded through an EU grant could mean that it's in consideration to be used for the Digital Euro, but your criticism would apply independently of whether Taler or another technology is used, and Taler could also be used in different contexts without those limitations. The CBDC and Taler concepts live in different spheres, and it doesn't make sense to criticize Taler for pain points that you have with CBDCs.

Btw, I haven't seen anything like an expiration date in the proposals for the Digital Euro [0], could you provide your sources for that claim?

[0] https://www.europarl.europa.eu/legislative-train/theme-an-ec...

No, I'm not confusing anything. I think you're trying distract from the incredibly antisocial effects this project will have. Everything I wrote comes from the position paper published on the Taler project's website:

https://taler.net/papers/cbdc2021en.pdf

Page 16: These denomination keys, and thus the coins, would have an expiration date before which they must be spent or exchanged for new coins. Customers would be given a certain amount of time during which they could exchange their coins.

Paper and coin money also gets expired and you need to replace your mattress stuffing for the new versions every now and if you want to keep any value.

That sounds more like a technical aspect. It is probably related to cryptographic key expiry, not the balance itself. Also, even if what you said was true, having all your money expire all at once is so easy to avoid that it is kind of meaningless to even think of it as a problem. It's more like a pointless micromanagement hassle than a realistic way of stealing your money.

This is exactly how the physical representation of money works as well.

The central bank controls how many bills are in circulation, and the central bank regularly expires old bills and coins.

Only unstable third-world countries do that.

The Bank of England honors all of its old banknotes: "There is no deadline to exchange old banknotes with the Bank of England." https://www.bankofengland.co.uk/banknotes/exchanging-old-ban...

The United States has never demonetized any of its coins or banknotes. All of them are honored and are in fact still legal tender to this day -- even the $100,000 bill! https://en.wikipedia.org/wiki/Obsolete_denominations_of_Unit...

Although Canada has revoked legal tender status for some of its older bills, "The Bank of Canada continues to honor them at face value" https://www.bankofcanada.ca/banknotes/about-legal-tender/

In contrast, all of Europe has demonetized its old currencies (Deutschmark, French Francs, Italian Lira, etc.) when switching to Euros, and a few times before that. I've just looked it up and one Napoleon Franc is currently worth ~20€.

So, it's not that uncommon.

You can still convert old DM into Euros at the initial rate in Germany (https://www.bundesbank.de/de/aufgaben/bargeld/dm-banknoten-u....)

The majority of EU member set a limit date: https://www.ecb.europa.eu/euro/exchange/html/index.en.html

I don't think the majority in that list has set a limit for bills, only for coins

Uhm, i guess you are right. (9 vs 11). Sorry I guess I didn't pay enough attention.

No worries, you were right that a majority put time limits on at least some exchanges into Euro.

Europe is an unstable third world country, haven't you heard?

Denmark must be an unstable, third-world country, then:

https://www.al-bank.dk/presse-og-nyheder/nyheder/2023/1000-k...

> 4. the central bank gets to decide how much "cash" each individual deserves to have at any given point in time.

Taler is a payment system, it has nothing to do with central banks at all.

> 5. this "cash" has an expiration date, which is chosen at the whim of the central bank. If you stuff it in your mattress like paper cash, it becomes worthless. Therefore, this scheme is a massive step backwards in terms of central bank control over our lives, relative to coins-and-banknotes

Again, you must be confusing Taler with something else. Also, coins and banknotes have expiration dates too (for instance, try pay something with a Deutsch Mark note today).

Kind of sad to see the “Evil central banks want to control your life” conspiracy theory leaving the mud of 4chan to reach HN…

Like a lot of conspiracy theory, there's a core of truth. All you have to do is ask the question "is this system going to be allowed to be used for crime on a huge scale", receive the obvious answer "no", and infer that there will be some control built into the system.

Where it leaps into conspiracy is the question of when and whom this will be used against. But it's fairly obvious that measures will be taken against drug sellers, sex workers, banned political parties and so on.

This has nothing to do with what GP invented (amount control and expiration date set by central banks).

> But it's fairly obvious that measures will be taken against drug sellers, sex workers, banned political parties and so on.

Yeah, of course like governments already do with cash!

There's a big difference between saying “governments are going to police things” (which is always true, that's their purpose in fact) and spreading made up claims involving a central bank's conspiracy (spoiler alert: policing isn't part of central banker's job, if somebody is going to do anything it will not be them but the plain and boring law enforcement agencies, but that sounds less bad as a conspiracy to say that police is going to police stuff, I guess).

If anything, a technology like Taler is a big improvement in terms of individual freedom compared to things like credit cards. If governments want to stop cash to combat crime (and save money, the logistics around cash is very expensive) having Taler instead of Visa is a massive benefit for privacy and freedom.

The argument is that, if the money is just a database, the police will get it policed, or the bank will police it themselves, in an extra-legal way of just deleting or freezing accounts on request.

Like with regular bank accounts you mean? (Btw, Taler being just a payment system, you don't have anything but a regular bank account tied to it: you don't hold money through Taler anymore than you hold it on Visa: there's a small short lived wallet for transaction purpose but it's supposed to act like a purse, not a safe).

If you live in a country where the police can delete or freeze your bank account without legal control (or at all, even), then you're screwed and you can either change your government or find a new country, the fact that cash exists is not at all a big enough a guarantee for your freedom. At that point the government could also seize all your properties (including cash, something that the US police routinely does[1]) and/or keep you under arrest in secret prisons.

If you hope a technological mean (be it rudimentary like cash, or more modern like a blockchain) can help you protect your freedom against evil government, I have bad news for you. No technology can solve your political problems.

[1]: https://priceonomics.com/how-police-officers-seize-cash-from...