commit da0c9a6c9f188679bd45e9dc4712f6e23e682ea7
parent 7508bb06a0073c868771466bdd746c28705d0bc9
Author: Christian Grothoff <christian@grothoff.org>
Date: Mon, 7 Jan 2019 12:31:54 +0100
integrating Michael's comments
Diffstat:
1 file changed, 20 insertions(+), 15 deletions(-)
diff --git a/2018-cbdc-response/taler-cbdc.tex b/2018-cbdc-response/taler-cbdc.tex
@@ -70,13 +70,13 @@ The following components form the core of the system:
\emph{deposit permissions} with the exchange. The exchange checks
against double-spending, and if everything is in order provides
the merchant with an instant \emph{deposit confirmation}. After
- possibly aggregating many micro-transactions, the exchanges sends
+ possibly aggregating many micro-transactions, the exchange sends
money from the escrow account to the merchant's bank account.
- \item \emph{Auditors} are entities that certify which Exchanges are
- to be trusted as legitimate. Auditors must be configured in the
- electronic wallets and the merchant's infrastructure before these
- users accept digital coins the respective exchanges. Auditors
+ \item \emph{Auditors} are entities that certify which Exchanges can
+ be trusted as legitimate. Auditors must be configured in the
+ electronic wallets and the merchants' infrastructure before these
+ users accept digital coins of the respective exchanges. Auditors
include a software component used to conduct ongoing automated
checks of the Exchanges' wire transaction history to detect if
they deviate from their expected operation. For this, auditors
@@ -85,7 +85,7 @@ The following components form the core of the system:
\end{enumerate}
The implementation of all core components is licensed as free and open
-source (FOSS) software.
+source software (FOSS).
\section*{Addressing CBDC Requirements}
@@ -95,7 +95,7 @@ value-based payment system, we will address the common requirements
C1-C8 and requirements V1-V4 specific to the value-based model.
\paragraph{C1. Tokenization:} The ECB/NZBs would simultaneously take the role of the Taler Exchange
-and Taler Auditor (or could outsource operations to separate commercial entities).
+and Taler Auditor (or could outsource operations to qualified third parties).
\paragraph{C2. Issuance:} The ECB/NZBs create new CBDC units by issuing Taler digital coins,
and destroy CBDC units by accepting digital coin deposits from merchants, subsequently releasing
funds blocked in the escrow account and sending them to the merchant's bank account.
@@ -132,7 +132,7 @@ provide a mechanism for negative interest rates (for non-circulating coins).
\paragraph{V2. Limitation of bank runs:} Bank runs are discouraged and limited with Taler: (1) Withdrawal
limits can be imposed by the Tier-2 banks on the withdrawal of CBDC units; (2) wallet providers may place limits
on how much money can be stored in online wallets; (3) customers that mange their own wallet are discouraged from
-withdrawing large amounts of CBDC units in their wallets, as they must ensure its safety similar to a physical wallet;
+storing large amounts of CBDC units in their wallets, as they must ensure its safety similar to a physical wallet;
(4) modest expiration times with modest refresh fees make hoarding coins unattractive.
\paragraph{V3. Anonymity and AML:} The exchange does not know which customer owns which coin
due to the use of blind signatures during the withdrawal process.
@@ -143,19 +143,24 @@ already happened when the merchant opened their SEPA bank account. Furthermore,
deposit permissions are linked to the contract with the customer, allowing authorities
to validate the plausiblity of the transaction during tax audits.
With Taler, ownership of digital coins between mutually distrusting parties can only be securely transferred with a digital coin deposit via the exchange.
-This discourages ``invisible'' payments by sharing digital coins between wallets.
+This discourages ``invisible'' payments by sharing digital coins between wallets
+without involving the exchange.
\paragraph{V4. Ownership and spending rights of CBDC:} Technically literate
users have the option to manage their own wallets and private keys, whereas
other users can use wallet backup/sync/restore providers.
\section*{Contrast and Relationship to DLT-based Systems}
-The Taler payment system is independent from Distributed Leder Technology (DLT)
-systems. In particular, Taler payments are not necessarily backed by any
-blockchain or cryptocurrency. Even though Taler uses cryptographically secured
-payment tokens, it is distinct from ``cryptocurrencies'': Taler is designed to
-to serve as a payment instrument for retail commerce, rather than a long-term
-store-of-value or a speculative asset.
+
+The Taler payment system is independent from Distributed Leder
+Technology (DLT) systems. In particular, Taler payments are not
+necessarily backed by any blockchain or cryptocurrency. Even though
+Taler uses cryptographically secured payment tokens, it is distinct
+from ``cryptocurrencies'': Taler is a very efficient electronic
+payment system with certain characteristics like cash, but it is not a
+currency. Taler is designed to serve as a payment instrument for
+retail commerce, in contrast to DLTs which are generally used more as
+a long-term stores-of-value or as speculative assets.
Some technological advancements made by DLTs could potentially benefit Taler.
For example, public cryptographic key material and data relevant for auditing
