Co-founder of Tangem here. The crypto value is on the Tangem Notes, inside the secure chip — in the form of a unique private key which is impossible to copy. You can redeem any Tangem Note directly to blockchain without a third party — using an open NFC protocol. We provided reference apps for Android and iOS (only Android can redeem / extract the value at the moment).

Tangem as a company does not hold any cryptocurrency associated with Tangem Notes — we're just developing the technology and making sure the banknotes are impossible to hack or tamper with at any point in the supply chain or in public circulation.

The redeemable nature of Tangem Notes mean you have to verify their current value over NFC when receiving them from someone you don't trust. We rely on the high and growing NFC smartphone penetration. Offline balance check will be available through trusted attestation, but for now an internet connection is required, because the app will check against the blockchain, using electrum nodes.