Cashu, an open-source ecash protocol designed for Bitcoin and the Lightning Network, has introduced an experimental physical tap-to-pay card that allows users to make offline payments with Bitcoin-backed ecash tokens.
The card addresses a longstanding challenge in cryptocurrency payments: the requirement for both parties to be online. While Lightning Network payments are fast, they typically require internet connectivity from both sender and receiver. Cashu's card operates differently, storing bearer tokens on a JavaCard chip that can process transactions without an active internet connection.
How the System Works
Cashu functions as a Chaumian ecash protocol, with a "mint" serving as a custodian for underlying Bitcoin. A wallet loads ecash tokens onto the card, which can store value across up to 128 slots. When a user taps the card at a merchant terminal, value transfers without requiring either party to access the internet at that moment. Merchants can accept the offline tap and later settle the tokens with the mint once their terminal reconnects.
Each transaction produces a single signature that burns the tokens being spent, designed to prevent double-spending. The specification, called NUT-CCP, is part of Cashu's broader technical standards framework known as NUTs.
Hardware and Implementation
The cards are built on NXP J3R180 dual-interface smart cards. Blank versions are available for purchase online at approximately $9 per card in packs of 2 or 5. Users install open-source applications onto the blank cards themselves rather than receiving pre-loaded hardware from a central provider.
Privacy and Security
The card leverages blind signatures, the foundational technology behind Chaumian ecash. Blind signatures allow the mint to sign tokens without being able to link them to the person spending them later, preserving privacy. The card also employs pay-to-public-key spending conditions, locking tokens so that only the holder of a specific key can spend them.
An on-chip key is never released from the card, meaning the card itself must produce the signature for any transaction. This design prevents token data alone from being sufficient to access the balance. The single-signature burn mechanism on each tap is intended to prevent token reuse.
Known Trade-offs and Risks
Cashu's documentation identifies several risks. Loss of the card results in permanent loss of any balance stored on it. Users also depend on the mint's solvency and honesty, a dependence the card does not eliminate. Merchants face exposure to double-spending between the offline tap and the moment they reconnect to redeem tokens with the mint, though the on-chip burn mechanism aims to mitigate this risk. End-to-end testing of the cards has been limited to date.
The card represents one component of a broader Cashu ecosystem effort focused on offline and contactless payments, with additional merchant-focused applications planned.
