Digital cash anonymous and privacy respecting possible?

In Europe the “digital Euro” is coming some day. But as people know who follow the topic, it won’t be anonymous nor privacy at all. I really would love to pay things in a digital way instead of cash. But as long as there is no alternative, I wont do it.

But right now I’m more interested in the technology. Is it possible to create a system that works similar to cash? It has to work decentralized, offline, without any form of user IDs, but also should not be hackable (at least not easier than hacking a bank) in any thinkable way.

So virtual cash has to be verified, but also anonymous. Do you believe it’s theoretical possible or do you even know more than I do? Quantum technology or anything else from future included (as long as it has a high chance to become reality in next few decades).


I think Monero may be the closest thing to “digital cash” that exists today:


Yes, you can always bootstrap using labour.

Yes, Monero.

Hmm, not sure if an energy hungry blockchain solution something is what we really want. In best case the money could be verified with something less power hungry. But when I have more time I will read a bit more in what Monero makes different to give anonymity.

However, my question was not just about existing things, but things that could be realized by any government that would want digital cash without surveillance (if any would ever, but doesn’t matter here). And I guess governments want to have the monopoly of making new money and also to increase the amount as much as they want to control inflation etc. Both doesn’t seem possible with blockchain (at least the point with theoretical endless money).

But thanks for the input, didn’t know about Monero.


I think it is possible, at least to some extent. GNU Taler is an effort to build a very lightweight digital cash system using cryptography but no blockchain. It is a way to make existing currencies digital, rather than a new currency, and has some interesting properties.

Payments are “instant” and the system scales well since it doesn’t waste resources.

Coins are issued in such a way that the identity of the coin is unknown to the issuer. This prevents the issuer from linking spent coins to an individual. Neither can a merchant who receives payment, at least not from the payment transaction alone. So Taler is like cash in that way.

I’m unaware of anything that matches all of your criteria, but I find Taler to be the most appealing possibility so far. Sadly, apart from a Taler-enabled snack machine at the Bern University of Applied Sciences, it has yet to see actual use. But since you asked about the underlying technology more than availability for payments, here’s how Taler matches your list:

Anonymity in Taler only extends to buyers, not to merchants. In part, this is to prevent Taler from being a tax-evasion tool.

Physical cash is easy - either you have the physical coin, or you don’t. You can’t buy a magazine at a news stand and then use the same coins or bank notes to get coffee at a café. In contrast, a number of digits representing a coin could easily be copied and used multiple times. The way Taler deals with this is through direct communication between merchant and issuer.

As noted above, the buyer can’t be identified in this process. However, both merchant and issuer need to be online. So Taler is online and centralized. (Being offline seems a lot more difficult; Taler has a method where the merchant can be offline if the buyer is connected to the internet.)

That’s 0.5 out of 3 :frowning: Still better than the digital Euro…


The digital Euro can be used offline, but will check it once you (or the other person you transferred Euros) go online again. But who cares about using it offline if all your transactions are known to 3rd party.

But yeah, GNU Taler sounds more in the direction I’m looking for.

+1 for Monero.
Unfortunately, proof of work is, in my opinion, the best solution for a fully decentralized currency at the moment. If something provable better comes around, Monero will most likely change over to the new system, as they have a good track record of adopting new tech without forking the blockchain.

One positive thing for Monero, when comparing other proof of work currencies, is that they are using the RandomX algorithm. This algorithm is best suited for consumer CPU’s, by design, so every home computer can mine the currency. Bitcoin, for example, uses another algorithm that is best suited for specialized ASIC hardware. This hardware is specially designed to only mine Bitcoin. After some years, this ASIC hardware will be outdated, and can’t really be used for anything else.

I usually do some light mining on my desktop computer at home when it is cold. I have to heat my home anyway, and could help secure a decentralized currency and make some money at the same time.

Monero seems to be the de facto privacy currency, and can already be used for many things. I have used XMR to purchase hardware from purism, donate to content creators and FOSS software, to easily send money across borders to buy something on this forum, and to send and receive money between friends of mine


You can not tax Monero though. So governments will never bring it up as potential implementation.

However have a look at GNU Taler instead:


Checking the transaction afterwards will not prevent double spending, just detect it. Knowing who paid allows the system to take legal and other measures against that person.


The only other way that I can think of to have transactions offline would be hardware wallets. (I would love to be proven wrong!) I.e. some trusted hardware that makes sure coins can’t be copied or used more than once.

But we all know how that will probably be implemented. Proprietary smartcards using proprietary drivers only available for the latest version of Windows and/or proprietary secure enclaves embedded in processors and only available in recent duopoly phones.

So, unlike physical cash, not generally usable. Not usable because either

  • you can’t afford to buy a new phone or computer every two years
  • you object to using surveillance devices
  • you find yourself living somewhere on the naughty list in a trade war
  • the hardware is not made available to the homeless, immigrants, etc

Personally I’m willing to forgo fully offline use in favour of having some privacy. The hardware option would be nice if open and device neutral (including operating system etc).

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I agree on Moneroa as a non tracable payment solution.

For an offline methode, XRP can be used in the future. XRP-Labs have developed X-pop, which uses radio frequency instead of phone or wifi. The transactions will show up on the XRPL. So this is anonymous as long as you do not use an on and off ramp (to Dollar, Euro, etc). The other condition is that ‘everybody’ has XRP. BTW: XRP uses less energy then the regular payment system. It is friction-less, a transaction costs hardly nothing (0,000012XRP) and it is fast: 3 seconds per transaction.