Taler provides accountability to ensure business accepting payments operate legally, while also respecting civil liberties of citizens spending digital cash. Taler is a commons, a payment system based on open standards and free software. Taler needs governments to set a financial framework and to act as trusted regulators. Taler contributes to digital sovereignty in the critial financial infrastructure.
Taler was built with the goal of fighting corruption and supporting taxation. With Taler, the receiver of any form of payment is easily identified by the government, and the merchant can be compelled to provide the contract that was accepted by the customer. Governments can use this data to tax businesses and individuals based on their income, making tax evasion and black markets less viable.
Thus, despite offering anonymity for citizens spending digital cash to buy goods and services, Taler also ensures that the state can observe incoming funds. This can be used to ensure businesses engage only in legal activities, and do not evade income tax, sales tax or value-added tax. However, this observational capability does not extend to the immediate personal domain. In particular, sharing access to funds within a family or synchronizing wallets across multiple devices is not subject to monitoring.
Taler's payments are cryptographically secured. Thus, customers, merchants and the exchange can mathematically demonstrate their lawful behavior in court in case of disputes. Financial damages are strictly limited, improving economic security for individuals, merchants, the exchange and the state.
By design, the Taler payment service provider is subject to financial regulation. Financial regulation and regular audits are critical to establish trust. In particular, the Taler design mandates the existence of an independent auditor who checks cryptographic proofs that accumulate at the payment service provider to ensure that the escrow account is managed honestly. This ensures that the payment service provider does not threaten the economy due to fraud.
Taler is free software implementing an open protocol standard. Thus, Taler will enable competition and avoid the monopolization of payment systems that threatens global political and financial stability today.
Taler has an efficient design. Unlike timeline-based payment systems, such as Bitcoin, Taler will not threaten the availability of national electric grids or (significantly) contribute to environmental pollution.
Governments can observe traditional wire transfers entering and leaving the Taler system, and require merchants and exchange operators to provide certain information during financial audits. Exchange operators are expected to be permanently checked by auditors, while merchants may be required to reveal information during regular tax audits. Information available to the government includes: