Eduard's Personal Page

CBDC & e-cash with aggregating tokens

1. A proposal to implement the offline component of CBDC as e-cash
2. Introduction to e-cash technology to realise CBDC
3. Identifying the goals for the deployment of CBDC

Java Card

TBP

2023

• Cash: The once and future king pdf

  Abstract

  It’s time to bring order to digital money through the proper issuance of Central Bank Digital Currency (CBDC). While many financial services moved to the digital realm based on centralised account ledgers, there remains an unmet need for a cash-like, distributed, digital, bearer pay- ment instrument. A hodgepodge of existing proprietary electronic cash (e-cash) products have shown this need can be met, but only in frag- mented, disconnected walled gardens. Only a central bank can be the issuer of an e-cash instrument that brings the traditional benefits of cash to the digital world. Every economy in the world will benefit when its central bank issues a digital currency. To enable reaching this goal, I have developed a formal model for money as an information system. This model includes Cash as one form of distributed money. Based on this model I have developed aggregating token technology as an e-cash implementation to deliver the key benefits of physical cash to the digital world. It supports online and offline transactions that can be securely received with a software-only implementation. A money system based on this technology supports both monetary and security management. This aggregating token e-cash solution is the only technology that meets all of the key requirements for CBDC.

• Ledgers and Tokens for Central Bank Digital Currency pdf
  with Peter A. Cattaneo

  Abstract

  In this paper we illustrate the relationship between ledgers and tokens in a complete CBDC solution that delivers fast, immediate, low-overhead payment, both on-line and off-line. We also present a technical basis for a manageable, scalable implementation that provides privacy by design and by default.

• Transferable E-cash as central bank digital currency pdf

  Abstract

  It’s time to bring the benefits of cash to the digital world as Central Bank Digital Currency (CBDC). Many financial services have moved to the digital realm based on centralised account ledgers, leaving a still unmet need for a cash-like, distributed, digital bearer payment instrument. A hodge- podge of proprietary digital payment products have shown this need, but they only deliver cash-like payments in fragmented, disconnected walled gardens with significant limitations and fees. Only a central bank can issue an electronic cash (e-cash) payment instrument that brings all of the key benefits of cash to the digital world. When a central bank issues a digital currency, it’s citizens will see lower fees, enhanced privacy, and a root of trust that is democratically accountable.

• Requirements for the success of a digital euro pdf

  Abstract

  The issuance of a digital currency by a central bank (CBDC) is foremost a political decision as it concerns the accessibility by the citizenry to the means of payment in a society. The technical solution to implement CBDC must follow the political objectives. This note presents the key political aspects to be considered and analyses risks, technical requirements and business perspectives of current proposals, in particular for the digital euro.

• (draft) How the king returns: a digital future for cash pdf

  Submitted to the September 2023 conference on Cash and the future of money

  Abstract

  Over the last 3⁄4 century society has become largely digitised. Banks were early movers digitising their ledgers as databases. Cash, banknotes and coins, up till the present could not be digitised. This paper shows how cash can be digital, as e-cash. E-cash is a form of money with all the features of traditional cash that brings additional benefits from being digital. Digital e-cash can be paid from person to person or over the Internet, it can be withdrawn from a bank account without visiting a physical ATM and deposited as easily. With the faster availability of more, fine-grained information the responsible issuing authorities can manage a digital cash system with better controls than they have today for physical cash. A formal model of money as information is presented as guide to a proper implementation of e-cash as a distributed system of secure personal digital devices, the electronic purses (e-purses), that can pay purse to purse with finality, without intermediation, protecting payer privacy and without per-transaction fees. An electronic purse is a digital bearer payment instrument. Based on this design principle and applying the aggregating token technology to secure the transfer of value, this paper demonstrates how users of the e-cash system, the issuer, financial institutions and citizens can each benefit from a suitably dedicated implementation of an e-purse to participate in the digital future of cash. With the formal model presented, the critical analysis of other types of money it affords and the elaboration of the design principle with the proper technology, this paper provides a solid foundation for the further development of a cost-effective, secure, and manageable system that delivers the digital promise of e-cash.