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2021-2: Helping the European Commission

In December 2020 the European Parliament asked the European Commission about the suitability of GNU Taler to establish a digital Euro in a small inquiry. In the official answer, the commission mostly asserts that it is unable "to assess the functioning of the GNU Taler payment system", and points to a maximum transaction limit of 150 EUR, without really answering the questions raised by the inquiry.

To assist the European Union with regards to the inquiry, we point out that the operation of GNU Taler is completely and transparently made public at https://taler.net/, so if the European Commission is, like anyone else, in position to assess the functioning of the GNU Taler payment system. We recently also described details of how the system would function for an E-Euro in a working paper with the Swiss National Bank. Based on our publicly available documentation, Prof. Birchler, a previous member of the directorate of the Swiss National Bank, publicly commented that our approach is the best published proposal for digital cash.

With respect to EU policy objectives, we would like to point out that the 150 EUR limit postulated by the European Commission for private payments is very low, and in our view incompatible with the data protection objectives of the European Union. We want to stress that with GNU Taler, only the citizen making the payment can remain anonymous. Thus, Taler is not suitable for money laundering or illegal business activities as receivers of payments are easily identified. A recent broad consultation by the European Central Bank showed that the European population demands privacy compareable to physical cash when it comes to the Digital Euro. With cash, the transaction limit is at 10,000 EUR. Thus, were the 150 EUR limit apply truly to all forms of privacy-friendly electronic cash, this would be a key point where the European Union should provide for more citizen-friendly regulation, especially for technical solutions that include security features that adequately minimize the risk of citizens suffering financial losses.

Finally, we would like to stress that the GNU Taler project is open to a cooperation with the European Central Bank, and is happy to answer questions from specialists of the European Parliament or the European Commission.

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