[Taler] How to issue a Central Bank Digital Currency

[Christian Grothoff]

Dear all,

I am happy to announce the publication of our paper on "How to Issue a
Central Bank Digital Currency" by the Swiss National Bank. I am posting
this here, as the paper [1] at its core proposes to use GNU Taler
(https://taler.net/).

[1] https://www.snb.ch/en/mmr/papers/id/working_paper_2021_03

It is my hope that the paper will inspire central banks around the world
to adopt our scalable, user- and privacy-friendly Free Software payment
system when implementing digital currencies.

Of course plenty of work remains to be done, especially with respect to
integrating GNU Taler into online shops and a multitude of applications.
You can find extensive documentation on the GNU Taler protocol at
https://docs.taler.net/.  The source code for implementations of the
various components is hosted at https://git.taler.net/. Join us, our
mailinglist is hosted here: https://mail.gnu.org/mailman/listinfo/taler


Happy hacking!

Christian


Abstract:
With the emergence of Bitcoin and recently proposed stablecoins from
BigTechs, such as Diem (formerly Libra), central banks face a choice of
either leaving the field to private actors or offering their own digital
alternative to physical cash. We do not address whether a central bank
should issue a central bank digital currency (CBDC). Instead, we
demonstrate how a central bank could do so, if desired or needed. We
propose a token-based system without distributed ledger technology and
show how earlier-deployed, software-only electronic cash can be improved
upon to preserve transaction privacy, meet regulatory requirements in a
compelling way, and offer a level of quantum-resistant protection
against systemic privacy risk. Neither monetary policy nor financial
stability would be materially affected because our CBDC would replicate
physical cash rather than bank deposits.