Blockchain Banking Core Federation Proxies
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Solution Overview
Problem
Current core banking systems lack efficient, transparent, secure, and verifiable methods for distributing tasks between internal and external blockchain infrastructure, leading to challenges in data record management and access control, which are crucial for financial transaction processing.
Innovation Solution
Implementing a blockchain-configured banking core (BCBC) and blockchain-configured federation proxies to enable secure, transparent, and efficient data record access control and management through a distributed transaction registry, utilizing smart contracts and independent verification networks.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If traditional relational database management systems are used for core banking, then system simplicity and ease of operation are maintained, but data storage reliability, security, and transparency are insufficient
Solution Approach 1:
The system divides the banking infrastructure into multiple independent blockchain nodes distributed across different locations and organizations. Each node maintains a copy of the transaction registry, segmenting the centralized database into decentralized units that collectively provide enhanced reliability through redundancy and distributed verification.
Solution Approach 2:
The patent introduces federation proxies as intermediary components that bridge traditional banking systems and the blockchain network. These proxies handle translation and communication between legacy systems and the distributed ledger, enabling integration without requiring complete system replacement and managing the complexity of interoperability.
2Reliability
If centralized data storage is used, then ease of operation and access are maintained, but transparency and verifiability of financial transactions are reduced
Solution Approach 1:
The transaction registry is segmented across multiple blockchain nodes, with each node holding a portion of the distributed ledger. This segmentation enables transparent verification as multiple independent nodes can validate transactions, while the modular architecture allows selective access to specific transaction records through cryptographic proofs without requiring access to the entire system.
Solution Approach 2:
The blockchain system implements continuous feedback through consensus mechanisms where nodes verify and validate transactions against established rules. This feedback loop ensures transaction integrity and transparency, with the distributed network collectively maintaining the state of the ledger and providing verifiable proof of transaction history to authorized participants.
3Reliability
If distributed blockchain infrastructure is implemented, then transparency, security, and verifiability are improved, but system complexity and implementation difficulty increase
Solution Approach 1:
Federation proxies serve as intermediary components that abstract the complexity of blockchain implementation from traditional banking systems. These proxies handle protocol translation, node management, and integration logic, making it easier to implement distributed ledger technology in existing banking infrastructure without requiring complete system redesign.
Solution Approach 2:
The blockchain nodes and federation proxies are designed as multi-functional components that can handle various banking operations including transaction processing, validation, consensus reaching, and data storage. This universality reduces implementation complexity by using standardized components for multiple functions rather than requiring specialized systems for each operation.
4Adaptability or versatility
If access control rules are made updatable by owners, then adaptability and flexibility are improved, but security and access control integrity may be compromised
Solution Approach 1:
The access control system implements feedback through consensus mechanisms where any proposed changes to access rules must be validated and agreed upon by the distributed network nodes. This feedback loop ensures that while access control can be adaptive and updatable, all changes are transparently verified against security criteria and consensus protocols, maintaining both flexibility and security.
Data Source
AI summary
Blockchain validation systems including a blockchain configured banking core (BCBC) hosted on a server, a blockchain configured component coupled to the BCBC, permitting transfer of data records to the BCBC for storage thereon, and a number of blockchain configured federation proxies facilitating identification of access rules and execution of blockchain validation mechanisms. Methods for blockchain validation involving permitting interaction amongst a plurality of external computing systems associated with a plurality of entities in a manner bypassing a BCBC hosted on a server, through a blockchain configured component accessible by the external computing systems, permitting data record transfer to the BCBC over an independent verification network, managing the data records using blockchain configured federation proxies, and selectively distributing data records to the entities.