Transferable Digital Notes Project

TDNs in a nutshell

The Transferable Digital Notes System (TDNSYS) is a simple, reliable and easy to implement solution for replacing paper money with digital currency. The system is centralized, based on the client server model and can be implemented employing existing, reliable and proven state of the art technologies used in the Financial market infrastructures (FMIs). A Central Bank must implement the system.

The solution to the double spending problem is patent protected. This solution is not based on accounts with the Central Bank, blockchain or distributed ledger technologies. Preventing double spending is very fast. It requires only a few database transactions and negligible CPU processing time. Performing a TDN transaction is as fast if not faster than a credit card payment. There is no need for clearance as it is with credit card transactions. The money is available to the retailer instantly.


A TDN is a unique, impossible to guess long string of numbers associated with a money amount. The long string of numbers is called the TDN Signature. The Central Bank issues TDNs as an alternative to paper money and distributes them to the retails member banks in the same way as it distributes paper money. The Central Bank also reinforces the double spending prevention. TDNs can be requested from a retail bank in the same way as paper money.

The following transactions are supported by TDNSYS implemented at the Central Bank in order to perform payments or money transfers:

A TDN holder can use it to make a payment or to transfer it to somebody else. TDNs can be deposited in a bank account in the same way as paper money or they can be converted to paper money at a retail bank. The retail banks can deposit their TDNs in their reserve account with the Central Bank.

A transaction consists in the transferring of the TDN Signature from the payer to the payee. The Central Bank is not involved in the transaction, however, after entering in the possession of the TDN the payee has to request the TDN ownership from the Central Bank in order to prevent double spending.

For more details about the transferring process and the infrastructure involved see About Cash Transactions and Infrastructure

Here are the steps of very simple transaction:

  • The payer
  • Presents a TDN as a payment
  • The payee
  • Enters the TDN in a terminal connected to the Central Bank's system and requests the ownership of the TDN received as a payment
  • Central Bank
  • Looks up the TDN in the database. If found, transfers the ownership to the new holder, if the TDN is invalid returns an error.
  • The payer
  • Not able to use the TDN again
  • The payee
  • Can transfer or use the TDN as a payment.
  • Transaction Completed

It should be noticed that a TDN can be transferred without being connected to the Central Bank. In this situation the transaction is based on trust. The payee assumes the TDN is valid and the payer will not transfer the TDN again.

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