[Taler] (docs) taler-in-a-nutshell.txt

[Thien-Thi Nguyen]

Please find attached taler-in-a-nutshell.txt, a wip overview
(very brief) of how Taler works, based entirely on diagram on
figure 4.1 (page 75) of Florian's PhD thesis.

$Id: taler-in-a-nutshell.txt,v 1.4 2021/02/09 23:50:30 ttn Exp $

1. pay exchange (customer to customer bank)
2. wire transfer (customer bank to exchange bank)
3. withdraw coins (exchange to customer)
4. spend coins (customer to merchant)
5. deposit coins (merchant to exchange)
6. wire transfer (exchange bank to merchant bank)

The Taler payment system involves six entities: (a) customer, (b) exchange,
(c) merchant, (d) customer bank, (e) exchange bank, (f) merchant bank.  The
exchange is the central entity that mediates the wire transfer of real
currency between (d), (e), (f) by way of "coins", cryptographically secure
tokens passed between (a), (b), (c).

There are six steps to a Taler payment.

In step 1, (a) directs (d) to make real funds available to (b).

In step 2, (d) does a wire transfer of real funds to (e), fulfilling the
request from step 1.  (b) generates coins corresponding to those real funds;
these are called the "reserve".

In step 3, (a) "withdraws" coins, either wholly or partially, from (b).  These
coins are kept in a "wallet" under control of (a).  The coins in the wallet
are anonymous.

In step 4, (a) authorizes payment of coins from the wallet to (c).  This
transfers payment coins from the wallet to (c), and change coins from (c) to
the wallet (unless the payment amount exactly matches the denomination of the
coins in the wallet).

In step 5, (c) "deposits" coins into (b).  These coins are not anonymous.

In step 6, (b) directs (e) to wire transfer real funds corresponding to the
accumulated deposited coins to (f).

The intended audience is complete newbies (like myself).

My questions are:

(a) Is this accurate?  If not, what could be improved?

(b) Where to put this in the docs tree?  Can we include that
    (excellent) diagram as well?

Thanks in advance for any feedback/guidance on this.

-- 
Thien-Thi Nguyen -----------------------------------------------
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