Very nice concept, but I guess that if you try to create an exchange or accept payments with that: governments, tax offices and FATF institutions will come after you.
TLDR with my understanding of the concept:
At the opposite of crypto, the concept is that anyone can create an "exchange" acting as a bank, and all transactions are public in an encrypted form.
So you can check the transactions if you know the key of your transaction. But it is not crypto in the sense that you have to trust one authority (the exchange) as a bank. It is the one that will hold user credits in the end.
The very fun thing is to create a "bank" like that for you and your friends. It is like an IOU bank.
Have you read the paper or website? Taler explicitly envisions exchanges as regulated and audited entities.
The central bank should audit exchanges, and it even provides mechanisms to make this simpler. One leg of the exchange runs on traditional finance rails (ACH) as well.
It isn’t anyone can be a bank, it is “regulated audited entities should be able to exchange a ACH transfer for digital tokens”.
You a speaking about the Swiss white paper, but when I look at Taler website, doc and tech: it allows things to be "regulated", but there is nothing forcing that.
Whoever can spin up his "own bank" like that.
And whoever else can connect with this first bank.
And you can use Kudos, of whatever digital virtual currency that you want.
And most of what is interesting about this project is especially that. Not that traditional regulated entities could use it to spin up something new to basically do what they are already doing.
Regulations can never be forced into a technology, they can merely be adopted. PCI-DSS exists as a regulation in different jurisdictions, but there is nothing forcing it either - its the contract your processor signs with their bank, and other many agreements similarly.
An exchange exists to convert Fiat to Tokens. A merchant can only accept tokens signed from an exchange. The Fiat<>Kudo transfer happens on an exchange and requires traditional regulated finance rails. Could you build a cash-backed exchange? Yes, but then merchants accepting that specific exchange will need a way to exchange it back to fiat, and that doesn't work.
There isn't a separate digital virtual currency in Taler. Taler is an electronic payment system that uses existing currencies (such as USD/EUR). Kudos is only used for the demo, but in a real deployment, it will be USD/EUR/etc.
TLDR with my understanding of the concept:
At the opposite of crypto, the concept is that anyone can create an "exchange" acting as a bank, and all transactions are public in an encrypted form.
So you can check the transactions if you know the key of your transaction. But it is not crypto in the sense that you have to trust one authority (the exchange) as a bank. It is the one that will hold user credits in the end.
The very fun thing is to create a "bank" like that for you and your friends. It is like an IOU bank.
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