This comes up every so often on HN, it's been in development for a while. I do see at least some technical work happening in Taler (https://taler.net/en/news/index.html) so it doesn't look like the project is dead, but I'm having a hard time finding a roadmap.
What is the overall state of Taler today? How close is this to being something tangible that I can hand to my parents where they can actually make real payments with it for an online product? Are there any businesses supporting it as a payment method yet?
I vaguely remember last time I checked that it was still trying to get buy-in from banks? But I could be remembering wrong.
There is no public roadmap on the business side as the commercial banks we are talking to are not yet willing to have their names disclosed to the public. They're rather conservative institutions (by nature), so they want things to be checked and double-checked and ready to go before going public. Plus it is not trivial (for them) to check all of the regulatory, technical and business checkboxes. I remain hopeful that we'll get through this mess "soon", but I've been too optimistic in the past.
What I can say is that we have presented GNU Taler to over a dozen central banks already. We're trying to convince them that they must give citizens privacy and that an account-based system would give them too much power.
So while the business side is not exactly transparent, what we do technically is all out there. And it's not necessarily a bad thing to have some extra time to reduce the list of known bugs before we go live. :-)
It's good to know that side of things hasn't been abandoned.
> I remain hopeful that we'll get through this mess "soon"
I know you can't give more definitive timetable or details about actual negotiations, but at a high level what does "get though this mess" here mean, what's the short-to-medium term goal that Taler is trying to achieve for how it initially enters the market? Is it possible I wake up one day X months/years from now and just see an announcement that a bank has now decided to use Taler and it'll go live next week, or is this something that's expected to be much more gradual in its rollout?
I don't feel like I have a great understanding of what the process for adoption for Taler looks like beyond the long-term goal that banks would start supporting it and then merchants would follow. I'm not sure if the plan is:
- a bunch of private negotiations happen, and then there's a breakthrough and suddenly within a year half of the banks are using it, or
- a bunch of smaller organizations take it up, and it starts out more niche and starts to grow, or
- somebody someday starts a Paypal equivalent that isn't even technically a bank, just a payment app.
I guess given that Taler is in talks with banks, the hope is that it gets adopted first with those banks; so is the goal that if talks are successful the rollout starts out at an almost national scale?
At this point, different things look plausible in different countries. Consider the possibility of a major banking technology provider offering it as a feature, in which case basically on day 1 you have 1000 banks that can choose to offer it if they believe their customers want to use Taler. Or you may have a smaller bank offer Taler as a limited experiment just to see if there is a business case, with very limited publicity. Or you may have a big bank offer it as a strategic product. Or you may have even a central bank beat everyone else and launch it as the official central bank digital currency. Personally, I'll probably sleep better if it starts small.
Would you mind chatting about this? I'd like to help if possible - tech like this shows a beautiful version of 'the state' that I would happily support.
We have a mailinglist (taler@gnu.org), and my personal e-mail is also not difficult to find out. We can always use help. Still looking for an iOS developer, for example.
Could Taler be used in a smaller scope already? For example, could it be used as an "account system" inside an association (like a hackerspace), where members can charge their accounts with Talers and then use these to pay drinks from the fridge, etc?
Setups like this could be used to test the system in practice.
Even though I read the GNU Taler FAQ please excuse any lack of deeper knowledge about it.
When dealing with those commercial banks what is currently the biggest challenge? Is it more the political arguments or the technical arguments of such a payment system that you need to stress? And, I couldn't find no definite answer to that: Could GNU Taler ultimately replace Bitcoin?
Given that for many larger banks, medieval things like overdraft fees and "re-ordering" same-day transactions so that deposits appear later in order to create additional overdraft fees are a huge part of their bottom-line, it doesn't surprise me that they would avoid relinquishing control to an open and fair standard they can't override.
Also, I'm sure anti-money-laundering legislation complicates things in terms of the anonymity feature, despite the fact that merchants are fully auditable, though I assume users aren't able to transfer funds to non-merchants? Still, I'm sure the laws as written complicate this in some jurisdictions.
For example, you could have a completely legitimate business registered as a merchant function as a money-laundering front that could then take in illicit funds from anonymous users working for the illicit org which actually secretly owns the merchant. I'm fine with that happening in the wild because the benefits of privacy for consumers are obvious to me and outweigh the negatives, but I bet regulators aren't so forgiving.
In the wild this often happens -- there are plenty of "DDoS protection" services that by day offer legitimate services in the open and by night actually attack potential customers who they then offer their protection services to, so it is not at all unheard of for an illegitimate org to have a legitimate front. This sort of thing is rampant in the world of high-end minecraft servers, I'm told.
GNU Taler is a nice software project. The problem with privacy-preserving centralized payment systems is that "writing software" remains the relatively easy part of the deployment puzzle: in practice you need to convince centralized banks and payment systems to deploy it for some application. Unfortunately, cryptographers have been trying to do this since the 1980s and DigiCash... with extremely limited success.
Decentralized payment systems have changed the equation and now we're seeing a great deal of progress in the area of privacy-preserving payments, some for better and some for worse. I wish Taler could find some applications over there, but the developers don't seem interested. Which is only fair.
(Disclosure: I've worked on decentralized private payment systems.)
Completely agree on where the difficulties lie in getting something like this used. Eventually it will happen though. To me it is a question of timing.
> As Merchants are not anonymous, they can be taxed, enabling income or sales taxes to be withheld by the state while providing anonymity for Customers.
Pulling this off in the United States sounds somewhere between very challenging and impossible.
Sales tax is not uniform. Rates vary not only by state but also at a local level. In some states, sales taxes can be imposed by the state, by counties, by cities, by school districts, by transit authorities, and by other entities like special purpose districts[1].
Which ones (plural) of these sales taxes (plural) apply to a transaction depends on the buyer's location.
In many cases, knowing the buyer's city, state, and zip code is not granular enough. For example, the boundaries of a school district may not correspond to zip code or city.
The typical approach today is to collect the buyer's full address. From that, there are databases that will tell you the list of jurisdictions and taxes that apply. Obviously, that's not very anonymous.
Maybe you could have the buyer determine all of the jurisdictions/taxes that apply to them and send only that info instead. That's less granular, but in some cases it might give away a lot of information. (Sort of like browser fingerprinting.)
But if you do that, I'm not sure what the implications would be for sellers. Sellers are required to collect the sales tax and remit it to the state. They can get in trouble for not doing it right. Governments don't like it when their taxes don't get collected, so they sometimes create laws that put the burden of compliance on the seller.
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[1] Special purpose districts could allow a county or local government to, for example, pick an arbitrary area and impose a sales tax within it just to support libraries that serve that area. Or crime prevention, road improvement, emergency services, hospitals, parks, economic development, etc.
I'm talking about the "while providing anonymity for Customers" part.
Providing anonymity for customers AND collecting sales tax (in the US) are two goals that conflict with each other. Maybe there are ways to resolve the conflict, but that's far from obvious.
I'm not talking about whether it's automatic or whether GNU Taler makes it easier. I'm talking about whether making the seller info public is enough to comply with tax laws.
GNU Taler doesn't calculate or automatically pays the tax, it's just to prevent tax fraud so that authorities can check if the paid taxes correlate with the income.
The point is that SALES tax in the US doesn't correspond with "income" or even revenue. Sales tax isn't determined by the seller's characteristics - it depends on the buyer.
The answer is obvious: get rid of sales taxes. They are the stupidest most regressive taxes we have. They are cumbersome, and they screw with price transparency, and they shouldn't exist.
Incidentally, I support taxes in general and think we need more taxes on a lot of things. But taxes add cost to specific activities, and so they should be used to reduce those activities. Now, we don't want the perverse incentive of government relying on tax revenue and thus otherwise wanting to promote the activity. So, we need to find a balance in all these things. But like taxes on stock-trading would be good. And we should probably increase property taxes and just do the simple thing where property tax rates go up the more properties an entity holds (that makes it harder for investment companies to buy up all the properties and gouge everyone with high rents).
But for all the justified complexity of tax policy decisions, sales taxes are the worst and should just be eliminated.
Consumption taxes are regressive and punish the poor, but there's a case to be made for taxing transactions, primarily because government is expected to intervene if transactions go wrong. Same for property and wealth taxes, because the government creates property by deciding who owns things, deciding what that means, and intervening in any dispute.
There's less of a US case to be made for taxes on wages, but just because the US shits on labor and spends almost no resources in defending it or the health and security of the people who provide it. Other countries that do more have a better case.
You.. can be a millionaire.. and never pay taxes! You can be a millionaire.. and never pay taxes! You say.. “Steve.. how can I be a millionaire.. and never pay taxes?” First.. get a million dollars. Now.. you say, “Steve.. what do I say to the tax man when he comes to my door and says, ‘You.. have never paid taxes’?” Two simple words. Two simple words in the English language: “I forgot!” How many times do we let ourselves get into terrible situations because we don’t say “I forgot”? Let’s say you’re on trial for armed robbery. You say to the judge, “I forgot armed robbery was illegal.” Let’s suppose he says back to you, “You have committed a foul crime. you have stolen hundreds and thousands of dollars from people at random, and you say, ‘I forgot’?” Two simple words: Excuuuuuse me!!“
I thought it was obvious that I was saying that governments should eliminate sales tax. It wasn't in the slightest a suggestion for how software deals with the status quo that has sales taxes. I understand it's not going to happen any time soon and is totally out of the hands of the software developers. I didn't think any of this needed to be said though, I thought everyone would already understand that implication from my comment.
> You do know that neither merchants nor folks writing tax or sales software can "get rid of sales taxes", right?
On the other hand, folks who write tax or sales software don't need to cater their software to US tax laws. Just don't use it there. At least from Wikipedia it seems, that the project leads are European.
Property taxes are worse than all other taxes. Why do I have to pay rent to the government for property that I already bought and paid for? Why does the amount of property tax I owe have no relationship to how much gain I actually realize, like income and capital gains taxes? Even sales tax has some sort of relationship to your realized gain (if you have less cash you probably buy less, so you pay less taxes).
Property or land taxes are better than all other taxes, for a number of reasons.
* It is hard, nearly impossible to avoid.
* In case of nonpayment the property serves as collateral.
* Land value depends mostly on public infrastructure paid with public funds - roads, subways, schools etc are all public goods that the property owner profits from via price appreciation but the general taxpayer pays for. So a linkage needs to be established. See https://en.wikipedia.org/wiki/Georgism
In the words of a famous conservative:
"Roads are made, streets are made, services are improved, electric light turns night into day, water is brought from reservoirs a hundred miles off in the mountains – and all the while the landlord sits still. Every one of those improvements is effected by the labor and cost of other people and the taxpayers. To not one of those improvements does the land monopolist, as a land monopolist, contribute, and yet by every one of them the value of his land is enhanced. He renders no service to the community, he contributes nothing to the general welfare, he contributes nothing to the process from which his own enrichment is derived ... the unearned increment on the land is reaped by the land monopolist in exact proportion, not to the service, but to the disservice done."
> Land value depends mostly on public infrastructure paid with public funds - roads, subways, schools etc are all public goods that the property owner profits from via price appreciation but the general taxpayer pays for
Spot on. You could think of a city as a "service" that you consume by taking space. The more space you use the more you should pay every month.
Even more so if you own a house and leave it unoccupied, because it's wasting public money invested in infrastructure.
> Land value depends mostly on public infrastructure paid with public funds - roads, subways, schools etc
This is a strange conceit. Martha's Vineyard and Maui do not have orders of magnitude better "public infrastructure" than Kansas.
If anything, recent US real estate growth is a function of people leaving high-tax areas for inferior asphalt.
It ignores that zoning is contentious precisely when "public goods" are perceived to harm land value.
There's a circular reasoning in "land monopoly." Cover a grocery store in solar panels: who is "contributing to the general welfare," and who collects free rent?
Then charge fees for those services based on actual free market supply and demand! Don’t assess everyone a tax based on the perceived unrealized value of the property.
UPDATE: also, read up on the differences between property tax and land use tax. They are different.
‘Nother Update: also, the government should stop encouraging property ownership as an investment for your future and retirement (tax breaks for mortgages, low interest rates, planned inflation) and then charge taxes on the hugely inflated value of that property.
Also, most property taxes are local state-level taxes, and most state-level congresspeople have to have a side gig to stay afloat. Guess what that side gig is: Real estate. Many are realtors and developers. They have a vested interest in raising property taxes to get people selling houses.
> charge fees for those services based on actual free market supply and demand
There's something to be said for this, but it doesn't work to just flip to the opposite extreme. As long as there are wealth inequities, then free-market supply-and-demand turns into the idea that anyone poor shall have nothing, not even the capacity to travel on streets or drink water. If they don't want to just up and die, they can get a loan to do these things and go into a cycle of indentured servitude for life.
The free market has never had any solution to such issues. Supply-and-demand works best when all the players have the same overall capacity to pay for things, and that's not how reality works out.
Societies prosper when efforts are made to make sure everyone has the foundations from which to build a productive life. That means health care, shelter, basic food and water, safety, capacity to get around (transportation of some sort), and access to information (education, libraries etc). If everyone has that stuff, they have the chance to add productivity to society rather than be a drain in the form of disease, crime, and so on.
Yes, block pricing makes sense. Prices are SUPER valuable as are other market dynamics! The same should be used for electricity and gasoline and many other things.
But the free-market dogmatists aren't interested in using markets and prices effectively, they are interested in their self-concept as people who really "get it" and understand all the complex dynamics of economics. Once you let messy ideas like externalities and market-interference/regulation like block pricing and on and on and on… this becomes very threatening to their identity as it pushes them toward having to say "gosh, it's so complex, and I don't understand it all".
Everything you said is contradicted by reality. Charities exist in the free market. The fee market pushes prices down more than any other system. Items that start out as luxuries quickly becomes affordable commodities. Wealth increases and abounds in a free market.
Charities do exist in the free market, yes. They are also a tiny tiny fraction of what's needed to address wider social problems. No charity efforts are comparable to or have the potential to replace something like Social Security and Medicare.
> pushes prices down
Except in the cases where it doesn't, such as luxury brands that exist to show off how expensive something is or for people to believe something is better because of the higher price — and this phenomenon is widespread throughout tons of aspects of the economy. Brands exist that sell essentially commodities at inflated prices through the power of advertising.
> Wealth increases and abounds in a free market.
According to the model you believe in, but that model isn't reality. Reality includes the fact that the wealthiest places on the planet (I mean larger societies, not places like off-share tax havens that just cater to the ultra-wealthy) have markets (but not completely free ones) and a history full of grotesque exploitation. The U.S. built it's initial wealth on slavery, genocide, and theft, and the non-free aspects of U.S. corporate behavior is still today a major factor of life.
You might indeed be right about wealth in truly free markets. But you don't have any controlled experiment on a society-size scale to even use for evidence since no case like that exists. And applying the ideas from one model to other situations doesn't mean it just becomes the model somehow.
There are more taxes for Merchants than only sales taxes.
The point the income stream via GNU Taler can be easily verified put the buyer still keeps his anonymity.
I don’t know if this is obvious to you or not, but this does not sound like a problem for merchants in most parts of the world. US sales tax is insane and not representative of most jurisdictions, globally speaking.
I’m not saying you couldn’t use Taler in the US - after all, sales taxes work for cash transactions which also anonymous for the buyer. I’m saying if you want to get automatic correct taxation of merchants, perhaps it’s a good idea to run your experiment outside the US.
I don't see why this would be an issue. Merchants deal with all of this today while accepting cash, which is an anonymous payment. None of this relies on tracking the individual customer.
The merchants accepting Taler payments would still be responsible for computing and including the applicable sales taxes in the final price charged to the customer. The customer then pays that, anonymously.
Another difficulty of the taxable feature is that for some retailers their sales tax changes all the time. A simple example is a food truck, sales tax rates can change daily depending on where the truck happens to be parked.
Overall its all very cool and this is in no way criticism on anybody that works on it. I am just point out to people that if you want to get involved or build on top of it what it is.
I would them to work together with some of those Peer-to-peer chat systems or something like that.
GNU Taler uses some libraries from GNUnet (and there is some overlap in core developers), but GNU Taler does not use the P2P (or GNS) functionality of GNUnet.
Seems like a lot of work to offer a less functional alternative to a VISA gift card purchased with cash.
The only real advantage I see is you don't need to stop by WalMart. Maybe the activation fees with Taler are less but I'm sure it's also less widely accepted.
VISA eGift cards are now available for purchase online with funds deposited to a digital wallet. These won't be totally anonymous but then as far as I can tell, neither is Taler --- to provide all the functionality they claim, they will need to maintain records of both purchaser and merchant.
In addition to the huge advantage of not needing to get cash from an ATM and physically carry it to the card vendor:
Transactions made on the same eGift card wallet are tied together. With Taler you have a wallet with coins you can spend separately, and which cannot be correlated, neither by your bank nor the merchant.
What makes you believe anyone (except maybe the purchaser themselves) needs to maintain records about the purchaser? As far as I understood it, their claim is that exactly this is not necessary.
What makes you believe anyone (except maybe the purchaser themselves) needs to maintain records about the purchaser?
Unless you buy your digital coins using cash, the exchanges have the identity of those who purchase and redeem coins/tokens.
From the documentation:
Taler is compatible with anti-money-laundering (AML) and know-your-customer (KYC) regulation, as well as data protection regulation (such as GDPR).
AML and KYC are all about removing anonymity. Merchants may not have the ability to correlate a purchase to you but the exchanges do; otherwise, they wouldn't be able to comply.
If you buy a coin, you have the bank sign it blindly, that means, after you unblind it, it is mathematically not possible to deeive any correlation between the coin and what the bank saw. The bank only knows the value of the coin(s) you bought, not the identity, and, apparently this seems enough to fulfill those regulations? If you draw cash from an ATM, the bank also has an exact record from that ATM. And in addition might have recorded serial numbers of the banknotes...
The exchange gets information about the merchant, but not about the purchaser (at least from the coin. The merchant might submit info about the purchaser such as the shipping address, but that is independent of the payment mechanism). That's strictly less than any credit card transaction.
The bank only knows the value of the coin(s) you bought, not the identity, and, apparently this seems enough to fulfill those regulations?
"Forgetting Your Customer" is *not* how you comply with "Know Your Customer".
Do you have any reference to how your blinding/unblinding supposedly works? Is it even mathematically possible to *insure* your identity is forgotten --- while still maintaining verifiable coin/transaction validity?
Without some such insurance, you're operating on blind trust and assumption. And you know what happens when you *assume* too much?
And in addition might have recorded serial numbers of the banknotes...
Except in very specific, pre-arranged circumstances (such as a ransom demand) they don't bother recording serial numbers --- simply because the info is quickly rendered obsolete and useless from the way cash is freely exchanged and "mixed" in the marketplace.
Cash is typically considered untraceable and is the ultimate physical form of anonymity. It neither requires nor provides any identity info. Gift cards purchased with cash are the ultimate form of digital anonymity. Neither of these conform to KYC.
The base objective of AML and KYC is to eliminate anonymity from transactions. Compliance is generally not possible otherwise.
Yes, it is mathematically ensured that the coin issuer cannot link the actual coin to the account you are buying it with. No blind trust needed, check the math yourself: https://en.m.wikipedia.org/wiki/Blind_signature
For the specific implementation, you can check the taler source code.
Is is possible to trace back a gift card to the store that sold it? Maybe even the date and time? Then get the surveillance tape... If you pay with the same gift card more than once, all those transactions can be linked.
> Seems like a lot of work to offer a less functional alternative to a VISA gift card purchased with cash.
Not sure about Taler. But with Chaum's DigiCash from the 90s you could do micropayments and other fun stuff.
The blind signatures gave Alice a way to pull out some amount of her "Cipherbucks" or whatever from her bank. Then she could PGP them to Bob, who could "uncryptography" them and redeem them at OverTheBorder Bank(tm).
If I read correctly, Alice nests a unique number in her sealed thingy, and the the banks would keep an append-only record of these unique numbers. So it's something like this:
1. Alice's bank knows she made a request for $X cipherbucks
2. Bob's bank knows he made a deposit of $Z cipherbucks
3. Bob's bank knows the deposit is good because the unique ID isn't already in the database
As for your question below-- doesn't that satisfy the "Know your customer" rules? It's functionally equivalent to cash so I don't see how it wouldn't
Edit: I'm not sure of the properties of the transactions, so maybe $X and $Z have to be equal? No clue. Still, you get the idea...
I dunno, one of the problems with modern banking is that the same account number is used for both incoming and outgoing transfers. That combined with the general lack of security makes it impossible for me to enable someone to put money into my account without also granting them the ability to take money out. Having separate accounts for incoming and outgoing would fix that. Of course, authorizing transactions with digital signatures fixes that too, but having separate accounts makes me feel kinda warm and fuzzy.
But that is just an implementation detail of who is allowed to initiate outgoing transfers from your account. For me, I needed to send a signed letter to my bank to allow recurring debiting to my landlord (and since I stopped that, no entity except myself is allowed to initiate outbound transfers from my account).
That's not to say the Taler model can't work or anything, just that having one number for inbound and one for outbound transfers isn't really necessary for basic account security. The "everyone who knows my account number can draw money from my account" problem seems weird to have (and trivially solvable) .... in which country is this the default?
That policy is particular to your bank. My bank (Chase) doesn't do that. Anyone who knows my account number and has access to ACH can drain my account. (I solve this by having two accounts, one of which I use for ACH, and the other which actually holds most of my money. I have to actively transfer money from one to the other on a regular basis, but it's worth the effort to me to mitigate the risk.)
> That policy is particular to your bank. Anyone who knows my account number and has access to ACH can drain my account.
That is unimaginable to me. Here (Czechia), banks require explicit confirmation of direct debit transfers (limit for value per period of time for each initiator of direct debit).
This is a really cool idea. I am interested in seeing other types of cryptographically secure payment or monetary systems come about, but decidedly not ones you'd call "crypto," much like Taler very carefully explains it is not.
For example, deflationary gold-like digital currencies just don't work. Fundamentally. It's a futile exercise to debate. But debt-based digital currencies run into some really hard problems.
How do you know if someone is good for their IOUs? If someone takes out a large amount of debt, what prevents them from dropping their wallet/identity and moving on to a new one and wiping themselves clear of their debts? Are all of these social issues? Does a new credit system built into such a currency serve as the basis for preventing someone from not paying their debts back to the network? Even if a credit system was built into the digital currency, someone can always create a new identity if there is no requirement for verification, but how do you design a system that does not require it?
It's a great project, but there is nothing in it for grifters. There is not much hype or fervor for innovation these days that doesn't involve potential bagholders.
• a dependency on a central exchange whose failure, or compromise, harms users; &
• vigorous enforcement of taxes – & potentially other onerous regulatory limitations
That may make it less of interest to many early adopters of cryptocurrencies.
On the other hand, there's technologically lots of potential for proving compliance with tax & regulatory regimes in a strong, minimal, privay-preserving way – helping refactor cooperation with legitimate governance in ways that don't create extra, incidental vulnerabilities to other privacy or extra-legal coercive abuses. This could help advance those practices & highlight future design choices.
Whether intentional or not, there's a hint of the word 'Thaler' in the name – originally derived from a place name ('Joachimstal' in modern Czechia) near historically-iimportant silver mining, and also a precursor of the modern English word 'dollar'.
Honestly I consider cryptos a trap even worse than actual "official fiat money": yes, formally they are able to operate peer to peer without a central bank/a banking system. Unfortunately they relay on an append-only "big file". No matter how efficient it can be in storage terms, no matter how much it can be tweaked, a day or another, after years of usage, it will grow too much to be used by essentially all people except those with big datacenters.
I see the same mechanic behind "free services" that start "gratis" and one took off start adding small fees, more small fees, not-so-small fees etc until they get classic commercial-only services and users now deeply tied with them can't escape.
Not counting the fact that without a network and relevant hw and sw we can't just exchange money, with cash we just need to have them and a third party with a hand.
It's a bit condensed but I think the point it's clear enough...
I'm always confused why taxability is a concern when it comes to cryptocurrencies. It is often brought up, including in the congressional hearings. How would it be any different than when we worked with cash? We were working with cash or checks until very recently. It seems rather simple to me. Employers still have to declare pay, stores still charge sales tax, and you can even build in a consumption tax (state level or federal) that applies to every transaction. A fully anonymous cryptocurrency doesn't seem to interfere with taxation in any way (in fact, if you built in a consumption tax to the gas fees you could essentially collect taxes from other countries).
I think it would be a major selling point for state adoption.
Cracking down on cash based tax evasion is often a major benefit touted when economies look to move to digital currencies, and most digital solutions to this problem "solve" it by throwing away anonymity. I most often see cashless solutions presented as a choice between do you want this system to be rampant with tax evasion and illicit activities but anonymous like bitcoin, or do you want someone keeping full plaintext records on every party in every transaction down to their street address and IP where the transaction was made like paypal.
How much tax is being avoid by cash payments? I can't imagine very much. If you're a business then there's too high of a risk unless you're a small fry. Maybe I'm missing something. But I imagine 90% of taxes aren't coming from those small enough to slip by. I also see an easy solution: 0.5% transaction fee built into the cryptocurrency.
I'm interested in trying this but after creating an account on their bank, I could not use the Android app to connect to it. It would be great to have a better onboarding experience. Because it is GNU I've got more hope that this is a reputable payment cryptocurrency.
If you're talking about the "taxibility" aspect of it, that's not a back door because it's right there in the front of the house, with a big banner and a red arrow pointing at it painted on the driveway.
Whether you'd like that particular house to have a door is a different matter entirely, but the design of Taler seems to be aiming for "let's make digital cash that a central bank might actually want to issue" and VAT is absolutely a part of that.
As far as I understand it, Taler is not made for person-to-person payments, but for person-to-service-provider payments. The idea of taxability is that the person sending the money (the customer) is anonymous, while the recipient of the money (the webshop, for example) is not anonymous. This allows taxing the companies, while giving more privacy to the customers than with the current system.
While this is a very different idea than decentralized cryptocurrencies, what it would give us as consumers is a much more privacy-preserving alternative to credit cards, Apple Pay and PayPal when buying things online (or in a store). At the same time, it is controllable enough for governments and banks that they could consider introducing such a system.
I've been imagining a taxation system where any bank account is actually two bank accounts, one pre-tax and one post, with an obvious identification difference (like odd/even ID numbers). Then you could pay e.g. your plumber knowing that your payment will be properly taxed, and all deductibility games your tax system might like to have would simply be dealt with by paying from the pre-tax account. IRS equivalents would have access to the pre-tax transactions, done. That would be all the tax bureaucracy you could ever need. Perhaps pre-tax purchases could even be public? Not sure if that would be a good thing or a bad thing, I'd like to hope that it might shift public perception of tax loopholes from "something clever" to "something to be ashamed of". Taler sounds like it could eventually lead to a setup like that.
So cash becomes illegal? Cryptocurrency becomes illegal? What do you do if this totally surveilled financial system comes under the control of an abusive state, or the surveillance powers are regularly abused by the state's employees? Have you heard of Snowden's revelations about LOVEINT?
Justice Douglas, in his dissenting opinion on the 1974 California Bankers Association v Shultz case that upheld the constitutionality of the Bank Secrecy Act, provided an excellent argument against warrantless mass-surveillance of monetary transactions:
It is estimated that a minimum of 20 billion checks - and perhaps 30 billion - will have to be photocopied and that the weight of these little pieces of paper will approximate 166 million pounds a year. 6
It would be highly useful to governmental espionage to have like reports from all our bookstores, all our hardware [416 U.S. 21, 85] and retail stores, all our drugstores. These records too might be "useful" in criminal investigations.
One's reading habits furnish telltale clues to those who are bent on bending us to one point of view. What one buys at the hardware and retail stores may furnish clues to potential uses of wires, soap powders, and the like used by criminals. A mandatory recording of all telephone conversations would be better than the recording of checks under the Bank Secrecy Act, if Big Brother is to have his way. The records of checks - now available to the investigators - are highly useful. In a sense a person is defined by the checks he writes. By examining them the agents get to know his doctors, lawyers, creditors, political allies, social connections, religious affiliation, educational interests, the papers and magazines he reads, and so on ad infinitum. These are all tied to one's social security number; and now that we have the data banks, these other items will enrich that storehouse and make it possible for a bureaucrat - by pushing one button - to get in an instant the names of the 190 million Americans who are subversives or potential and likely candidates.
It is, I submit, sheer nonsense to agree with the Secretary that all bank records of every citizen "have a high degree of usefulness in criminal, tax, or regulatory investigations or proceedings." That is unadulterated nonsense unless we are to assume that every citizen is a crook, an assumption I cannot make.
Since the banking transactions of an individual give a fairly accurate account of his religion, ideology, opinions, and interests, a regulation impounding them and making them automatically available to all federal investigative agencies is a sledge-hammer approach to a problem that only a delicate scalpel can manage. Where fundamental personal rights are involved - as is true when as here the [416 U.S. 21, 86] Government gets large access to one's beliefs, ideas, politics, religion, cultural concerns, and the like - the Act should be "narrowly drawn" (Cantwell v. Connecticut, 310 U.S. 296, 307 ) to meet the precise evil. 7 Bank accounts at times harbor criminal plans. But we only rush with the crowd when we vent on our banks and their customers the devastating and leveling requirements of the present Act. I am not yet ready to agree that America is so possessed with evil that we must level all constitutional barriers to give our civil authorities the tools to catch criminals.
Instituting mass surveillance of monetary transactions creates extreme centralizations of power, and the kind of all-powerful government you're advocating creating is a giant magnet for rent-seeking behaviour.
Large transactions in cash become an even clearer "likely unreported" hint/stigma than they already are. Note that there are two types of accounts in the proposed model: the post-tax account would be just as secret (or not) as before.
>>As far as I understand it, Taler is not made for person-to-person payments, but for person-to-service-provider payments.
As far as I'm concerned, this is an arbitrary distinction to rationalize depriving some class of interactions between individuals of the right to privacy.
>>At the same time, it is controllable enough for governments and banks that they could consider introducing such a system.
I find this very defeatist, and this attitude becoming pervasive would guarantee that the trend toward mass-surveillance of all private interactions would continue unabated.
Perhaps it's true that this is the type of system that governments and banks might be willing to introduce today. Afterall, privacy in financial interaction is not acceptable to the mainstream institutions. Over the last century, and especially since the early 1990s, the Overton window has shifted toward greater state control and less privacy. The proof of this is in the fact if cash were introduced today, it would be made illegal. And instead of pushing back against this trend toward mass-surveillance, Taler cows to it, with ideological rationalizations to boot.
Cryptocurrency has a real potential to reverse the trend towards a dystopian surveillance state controlled by a handful of governments and payment processors, and the people behind Taler are too enamoured with their left-wing political ideology, and visions of taxing every one, to support it.
Backdoors are covert by definition. You're talking about an avowed feature you don't like. There's a difference (and finding some random blog post that makes the same mistake is not a proof of anything).
That is not how the term is defined. Note from the article:
>>An encryption backdoor is any method that allows a user (whether authorized or not) to bypass encryption and gain access to a system.
Nothing in there about the method having to be covert.
When the Clipper Chip was proposed in the early 1990s, or when governments publicly propose encryption bypasses today, the mainstream news coverage refers to these mechanisms as "backdoors", despite no covert element in it.
The "SSLStore" is not the definitive source on the definition of a backdoor. It's just an EV certificate merchant.
Authorization plays a role in whether or not something is a backdoor. It's not a rigid definition because language isn't actually rigid, backdoors are defined in part by whether or not they're expected and wanted by the end-user, which is inherently a fuzzy category. But it's silly to say that any access method authorized or not is a backdoor, by that logic my own encrypted computer hard drive has a glaring backdoor in the form of me knowing the passphrase for it.
If you google the term, and find any article on the term, you'll see that it is not limited to access methods that are covert. Here's another top 10 result:
Pubicly proposed interception mechanisms, like the Clipper Chip, were widely referred to as a backdoor, as have those put forth by the UK government recently for encrypted messaging apps
>>backdoors are defined in part by whether or not they're expected and wanted by the end-user,
This would not be wanted by the end-user. The backdoor in this case is just an imposition on the receiving party, i.e. the merchant, that they'd rather do without.
No tool to let the state eavesdrop on or surveil one's private affairs is wanted by the party being subjected to it. This is unequivocally a backdoor, and it would only win out in the market if tools without backdoors are eliminated from the market by the state, using the state's apparatus of violence (the police, courts and prisons that gain compliance with government edicts).
> If you google the term, and find any article on the term, you'll see that it is not limited to access methods that are covert
Random company blogs and random UK news blogs aren't the authorities on what a backdoor is.
You look at something like, for example, Wikipedia, and it basically agrees with my take above: backdoors are usually covert, but are intrinsically somewhat fuzzy to define. This is how the word is typically used in common conversation.
> This would not be wanted by the end-user. The backdoor in this case is just an imposition on the receiving party, i.e. the merchant, that they'd rather do without.
Speak for yourself, this is literally the selling point of GNU Taler, this is one of the reasons people are interested in it. They put "taxable" in the tagline not just out of an interest in transparency but because it's their main "hook" to get people interested in the system.
Once again, I talked about this above, but backdoors are a fuzzy concept where different communities can end up with different conclusions about what does or doesn't fall into the category of a backdoor. The fact that you personally don't want income levels for merchants to be auditable by the state does not mean no one else wants that transparency (merchants included).
Once again, taking that idea to its logical conclusion would be absurd. A nontrivial number of software merchants would like it if my browser didn't have inspector tools and didn't let me look at the source code of pages that they sent me. A lot of web publishers would like it if browsers didn't have tools that let people intercept and modify HTML before it gets rendered to the page. That doesn't mean my browser inspector or my adblocker is a backdoor. These terms are in part socially defined, and yes, expectation and transparency are a part of how we do that. They're not the only part, but they are a part.
You posit a world where any disclosure of any information where anyone would prefer that information to be private is a backdoor, and that broadens the definition of a backdoor beyond the point of usefulness and beyond the scope of how most people and most articles online use the term.
I guess as just one last note, there's some irony in the fact that you're criticizing Taler for having a backdoor in the form of making revenue to merchant accounts auditable, when Ethereum/Bitcoin record literally all transactions to both sellers and buyers publicly, including not just transaction volume but transaction sources.
Yes, you can try to use Bitcoin/Ethereum pseudonymously, but you can also try to use Taler pseudonymously, and yes you can try to mix up your coins to obscure specific transactions, but you can also try to mix up your transactions and do money laundering on Taler too. Basically any privacy measure that Bitcoin tries to add on top of the blockchain to get around its more fundamental privacy problem could also be applied on top of Taler, including things like shared wallets, mixers, transaction rollups, etc...
By your definition of what a backdoor is, it seems like Taler is meaningfully less backdoored and meaningfully more private than most cryptocurrencies, including Ethereum. That's especially true once currency/coin exchanges enter the mix.
>>when Ethereum/Bitcoin record literally all transactions to both sellers and buyers publicly, including not just transaction volume but transaction sources.
That's not a backdoor, as it's not a method whereby a select few can view private information. Moreover, there are various methods, especially in Ethereum, where this private information can be hidden, like zk-SNARK-based mixing contracts that break the publicly visible link between deposits and withdrawals to it.
Ethereum's lack of privacy is a result of the attempt to allow global auditibility of the validity of transactions. There was no design goal of making it possible to spy on Ethereum transactions. That was an unintended side-effect, and as methods have been created to avoid that side-effect, they have been implemented by end users. Taler's design on the other hand breaks privacy intentionally, for the sake of preventing people from escaping taxation mandates.
> whereby a select few can view private information
Oh, cool, then Taler also doesn't have a backdoor, since its auditability is also not a method by which a select few can view private information.
> Moreover, there are various methods, especially in Ethereum, where this private information can be hidden, like zk-SNARK-based mixing contracts that break the publicly visible link between deposits and withdrawals to it.
Cool, you can also try to mix your transactions on Taler, so another point towards Taler not having backdoors.
> Ethereum's lack of privacy is a result of the attempt to allow global auditibility of the validity of transactions.
So what you're saying is a deliberate design decision to allow auditing as part of the core design of a product isn't a backdoor? Cool, then Taler doesn't have a backdoor. Note that Taler's auditing design is more private than Ethereum's, it leaks less information to accomplish the same goal.
> breaks privacy intentionally, for the sake of preventing people from escaping taxation mandates
Also known as auditability. Ethereum's design breaks privacy intentionally, for the sake of preventing people from double-spending.
>>Oh, cool, then Taler also doesn't have a backdoor, since its auditability is also not a method by which a select few can view private information.
The group that can view the private information in Taler is limited to the state.
>>Cool, you can also try to mix your transactions on Taler, so another point towards Taler not having backdoors.
On the list of features on the Taler website, it says the following:
>>Customers can stay anonymous, but merchants can not hide their income through payments with GNU Taler. This helps to avoid tax evasion and money laundering.
I think you're being disingenuous in implying that a non-backdoored version of Taler would still fit the description the Taler website itself gives for the software.
>>So what you're saying is a deliberate design decision to allow auditing as part of the core design of a product isn't a backdoor?
* Auditing of the validity of the transactions that doesn't require exposing private information to third parties
* Auditing by everyone, not a select few with privileged backdoor access.
> I think you're being disingenuous in implying that a non-backdoored version of Taler would still fit the description the Taler website itself gives for the software.
A version of Taler that didn't allow auditability wouldn't fit the description on its website, correct. That has nothing to do with whether or not it's a "backdoor", and more importantly, it has nothing to do with whether or not it's a desirable part of the functionality, regardless of whether or not you want to call it a backdoor.
Again, we can say the same about Bitcoin. I think you're being disingenuous in implying that a non-backdoored version of Bitcoin wouldn't allow double-spending. Theoretically Monero might fit the bill, but given that neither Bitcoin nor Ethereum have adopted Monero's transaction model, it's pretty obvious that the maintainers/community don't view plugging that hole as a priority.
> Auditing of the validity of the transactions that doesn't require exposing private information to third parties
> Auditing by everyone, not a select few with privileged backdoor access.
This is an interesting criticism, because Bitcoin objectively exposes more information to 3rd parties than Taler does. What you're arguing to me is that Bitcoin is more private because it exposes my information to literally everyone, and not to a limited subset of people.
It's like saying that my banking balance isn't private because the bank can check it, but if the bank instead broadcasts all of that same information to all of my employers and anyone who asks, then it's suddenly OK. It's like saying that if my partner has access to my phone that's a backdoor, but if instead Google just lists all of my contacts publicly on a webpage, then it's not a backdoor anymore. It doesn't make any sense, things become more private the fewer people who have access to them.
>>A version of Taler that didn't allow auditability wouldn't fit the description on its website, correct.
So the reasonable characterization of Taler's design is that it is backdoored, or as per your euphemization, "allows auditability" by privileged state authorities. Taler cannot remove that feature and still possess its defining qualities.
>>That has nothing to do with whether or not it's a "backdoor",
It has to do with the point you made, which is that Taler could remove that feature. It cannot, and I explained why.
>>I think you're being disingenuous in implying that a non-backdoored version of Bitcoin wouldn't allow double-spending.
Bitcoin is not backdoored. You're completely misdefining the term 'backdoor' now. This is a very bad faith argument from you.
>>Theoretically Monero might fit the bill, but given that neither Bitcoin nor Ethereum have adopted Monero's transaction model, it's pretty obvious that the maintainers/community don't view plugging that hole as a priority.
1. Not making plugging that hold a priority is absolutely not the same as providing state authorities with a backdoor as part of the design goals.
2. As a matter of fact, Bitcoin's LN has all transaction onion routed now. Ethereum has no need to take Monero's road to achieve privacy, as its Turing Complete program execution environment enables private transaction programs like AZTEC Network to run on top of it.
>>What you're arguing to me is that Bitcoin is more private because it exposes my information to literally everyone, and not to a limited subset of people.
I didn't say Bitcoin was more private. I said Bitcoin, Ethereum and other permissionless blockchains weren't definitionally backdoored.
>>Random company blogs and random UK news blogs aren't the authorities on what a backdoor is.
In natural language, the authority on what a word means is just the convention. When any of the top 10 search results I sample for the term 'encryption backdoor' use it in the manner I referred to, It's a safe assumption that this is how the term is conventionally understood, and thus the correct definition of the term.
>>backdoors are usually covert
That doesn't contradict what I said.
>>but are intrinsically somewhat fuzzy to define.
Yes I can agree that the definitions of terms are somewhat fuzzy, but I think I can reasonably call Taler's eavesdropping mechanism a backdoor.
>>The fact that you personally don't want income levels for merchants to be auditable by the state does not mean no one else wants that transparency (merchants included).
Merchants are not going to sign up for this if private options are available on the market. Even merchants that want to disclose their finances to state authorities would want to retain control over when and where they disclose that information, rather than providing a permanent open book to taxing authorities.
>>A nontrivial number of software merchants would like it if my browser didn't have inspector tools and didn't let me look at the source code of pages that they sent me
That's irrelevant to whether it's a backdoor. Your browser is not a tool that they use. It's a tool that you use. Thus inspection tools on it wouldn't be a backdoor by virtue of them wanting you to not have them.
I think at this point you're being pedantic and not discussing this in good faith.
> In natural language, the authority on what a word means is just the convention.
Look, I'm not the person who started word-for-word quoting random blogs to win a technicality fight about how a specific word was being used. You want to escape from pedantry, great. Here's the non-pedantic reality: Taler's ability to audit merchant income streams is meaningfully different from a clipper chip and they should not be compared to each other, regardless of what umbrella term you think they both fall under.
You want the non-pedantic argument about language? Language is (as you say) a convention, it's descriptive not prescriptive -- and the majority of people looking at Taler are saying its design around auditability isn't a backdoor; therefore it's not, because language is descriptive and not perscriptive.
> Merchants are not going to sign up for this if private options are available on the market.
Citation needed.
> Thus inspection tools on it wouldn't be a backdoor by virtue of them wanting you to not have them.
>>Taler's ability to audit merchant income streams is meaningfully different from a clipper chip and they should not be compared to each other, regardless of what umbrella term you think they both fall under.
Taler is designed to deprive people of financial privacy from the state:
>>Customers can stay anonymous, but merchants can not hide their income through payments with GNU Taler. This helps to avoid tax evasion and money laundering.
It is explicitly anti-privacy for a subset of users.
The comparison to Clipper Chip, outside of pedantic bad-faith misinterpretations of the qualities being compared, is entirely appropriate.
>>the majority of people looking at Taler are saying its design around auditability isn't a backdoor; therefore it's not, because language is descriptive and not perscriptive.
Citation needed.
>>Citation needed.
My assertion is based solely on common sense. Why on Earth would a person want to lose privacy vis-a-vis the state?
>>You're just making things up now.
What part of what I said are you alleging is incorrect?
> Taler is designed to deprive people of financial privacy
Taler is designed to make it harder to avoid taxes, it is orthogonal whether or not that impacts privacy. The comparison to the clipper chip is wildly inappropriate, there is a difference between taxation and the ability of the state to monitor literally all encrypted messaging between parties. There is obviously a difference between those two things.
> the majority of people looking at Taler are saying its design around auditability isn't a backdoor; therefore it's not, because language is descriptive and not perscriptive. [...] Citation needed.
That language is descriptive and not perscriptive? Merriam Webster and Ludwig Wittgenstein.
That people widely aren't looking at Taler's design as a backdoor? This comment thread and the responses of security professionals and prominent privacy advocates. Your original comments about a backdoor wouldn't be this far down the page if the community agreed with them. The response to GNU Taler from people embedded in the Free/Libre software movement would be different if people thought this was a covert spying operation. They don't.
> Why on Earth would a person want to lose privacy vis-a-vis the state?
They might like living in a society with public roads. This might be difficult to hear, but the majority of people in the US don't want taxation abolished, that's not a popular political position. It's fine for you to believe that taxation is theft and it's fine for you to advocate that taxation is theft, but even you sincerely believe that taxation is theft you still have to be able to go into these kinds of conversations understanding that's a minority position, even among a lot of people producing and selling goods.
What is the overall state of Taler today? How close is this to being something tangible that I can hand to my parents where they can actually make real payments with it for an online product? Are there any businesses supporting it as a payment method yet?
I vaguely remember last time I checked that it was still trying to get buy-in from banks? But I could be remembering wrong.