Taler: Usable, Privacy-Preserving Payments For The Web

Jeffrey Burdges, Florian Dold, Christian Grothoff, and Marcello Stanisci

Content and services provided on the internet, such as reading a blog post or sending an email, tend to be of very small monetary value compared to traditional financial transactions. Currently the majority of online offerings are financed via advertisements. Any alternatives must reduce the mental and technical overheads of existing payment systems to handle micro-payments. Addressing this problem is urgent because advertising revenue is declining, and the Big Data business model where citizens pay with their private information in combination with the deep state hastens our society’s regression towards post-democracy.

Taler is a new electronic online payment system that provides anonymity for customers. Here, anonymous simply means that the payment system does not involve any personal information from the customer, and that different transactions by the same customer are unlinkable. For strong anonymity, Taler usually needs to be used in combination with existing techniques, such as Tor and, to avoid circumstances leaking information about the customer’s identity. The facts that the user does not need to authenticate, and that the merchant thus never learns sensitive personal information about the customer, improves usability and security: the payment process is simplified, the merchant’s security requirements are dramatically reduced and the customer’s risk of identity theft does not accumulate with every (micro-)payment.

Taler uses blind signatures to create digital coins, and a novel “refresh” protocol to allow giving change and refunds while maintaining unlinkability. We will not go into the details of Taler’s cryptographic protocols here and instead focus on the high-level concepts to explain how the system works from the perspective of customers and merchants in the Taler system.