Blockchain Futures Trading System with Optional Crypto Delivery
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Solution Overview
Problem
Current cryptocurrency futures trading systems lack efficient mechanisms for the optional computerized delivery of cryptocurrency, particularly in blockchain-enabled platforms, which can lead to inefficiencies and increased costs due to the reliance on fiat currency settlements.
Innovation Solution
A blockchain-enabled electronic futures trading system that allows sellers to transfer cryptocurrency to a central clearing system, enabling optional computerized delivery of bitcoin to buyers at expiration, utilizing a trade determination system and central clearing computer system to facilitate transactions and manage cryptocurrency transfers.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of manufacture
If fiat currency settlements are used for cryptocurrency futures trading, then the trading system can operate with existing financial infrastructure, but the system incurs increased costs and reduced efficiency due to conversion requirements
Solution Approach 1:
The patent extracts the cryptocurrency delivery mechanism from the traditional fiat settlement system. By allowing sellers to optionally deliver actual cryptocurrency (bitcoin) directly through blockchain technology rather than converting to fiat currency, the system eliminates unnecessary conversion steps and intermediate financial infrastructure requirements, thereby improving trading efficiency while maintaining ease of implementation through modular system design
Solution Approach 2:
The patent introduces a central clearing computer system as an intermediary that manages both fiat and cryptocurrency settlement pathways. This mediator enables the system to flexibly choose between traditional fiat currency settlements and direct cryptocurrency deliveries, optimizing for efficiency when cryptocurrency delivery is selected while preserving the ability to use existing financial infrastructure when needed
2Adaptability or versatility
If fiat currency settlements are used for cryptocurrency futures trading, then the system can leverage existing financial infrastructure, but transaction costs increase due to currency conversion requirements
Solution Approach 1:
The patent implements a dynamic settlement system where the choice between fiat currency settlement and direct cryptocurrency delivery is flexible and adaptable. The system can switch between settlement methods based on market conditions, user preferences, and cost considerations, allowing participants to minimize transaction costs by selecting direct cryptocurrency delivery when advantageous while maintaining compatibility with existing financial infrastructure through fiat settlement options
3Productivity
If optional computerized delivery of cryptocurrency is implemented, then trading efficiency is enhanced and costs are reduced, but the system complexity increases due to blockchain integration requirements
Solution Approach 1:
The patent employs a central clearing computer system as an intermediary layer that manages the complexity of blockchain integration. This intermediary handles cryptocurrency wallet management, transaction validation, and coordination with the blockchain network, shielding end users from the underlying complexity while enabling efficient direct cryptocurrency delivery. The trade determination system similarly acts as an intermediary that integrates blockchain capabilities without requiring complete system redesign
Solution Approach 2:
The patent segments the futures trading system into distinct functional modules: the trade determination system for matching orders, the central clearing system for settlement management, and the blockchain interface for cryptocurrency delivery. This segmentation allows each component to handle specific tasks independently, reducing overall system complexity while maintaining high trading efficiency through optimized specialized functions
4Adaptability or versatility
If direct cryptocurrency settlement is enabled, then reliance on fiat currency is reduced, but the system requires new infrastructure for blockchain-based transfers
Solution Approach 1:
The patent designs the central clearing computer system with multi-functionality to handle both traditional fiat currency settlements and blockchain-based cryptocurrency deliveries through a unified platform. This universal system reduces the need for entirely separate infrastructure by integrating multiple settlement pathways within a single coherent architecture, thereby reducing overall infrastructure requirements while maintaining maximum settlement flexibility
Solution Approach 2:
The trade determination system and central clearing system serve as intermediaries that bridge the gap between traditional financial infrastructure and blockchain technology. These intermediary layers enable direct cryptocurrency settlement by managing blockchain wallet operations, transaction broadcasting, and confirmation monitoring, reducing the burden on participants to implement their own blockchain infrastructure while achieving reduced reliance on fiat currency
Data Source
AI summary
A blockchain enabled electronic futures trading system and method provided which allows for optional computerized delivery of cryptocurrency. A trade determination system allows a buyer and seller computer system to trade a future on a cryptocurrency such as bitcoin. Additionally, the trade determination system communicates with a central clearing computer system that allows the seller to provide, using the block chain, an amount of bitcoin equal to or greater than the underlying future by transferring the bitcoin from a seller bitcoin wallet associated with the seller computer system to a central clearing bitcoin wallet associated with the central clearing computer system. Upon the expiration date of the future, the seller may optionally select to provide to the buyer the bitcoin that was previously transferred to the central clearing bitcoin wallet instead of fiat currency.