Blockchain Gateway for Resale Control and Fraud Detection

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Solution Overview

Problem

Primary market sellers face challenges in controlling demand and pricing due to rapid changes in consumer interest and the impact of automated bots, leading to limitations in selling directly to individual buyers, adjusting prices, and verifying authenticity, while secondary markets driven by bulk purchasers create disadvantages for both sellers and consumers.

Innovation Solution

An electronic, online closed-loop blockchain gateway and transactional exchange system that uses hardware processors to establish a blockchain for secure, authenticated transactions, enabling merchants to manage demand, limit resales, and verify product authenticity through cryptographic tokens and digital vouchers.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Productivity

If sellers use conventional electronic marketplace systems to sell products, then transactions can be processed quickly, but sellers lose control over demand monitoring, pricing adjustment, and resale prevention

Engineering Contradiction:

Improvetransaction processing speedVSAvoidseller control over demand and pricing

Core Design Contradiction:

ProductivityVSAdaptability or versatility

Solution Approach 1:

The system implements real-time feedback loops where blockchain records of transactions, pricing data, and demand signals are continuously monitored and fed back to the seller's system, enabling dynamic adjustment of pricing and supply decisions while maintaining transaction efficiency

Inventive Principle:

Principle #23Feedback

Solution Approach 2:

A blockchain-based intermediary layer is introduced between the seller and buyers/resellers. This intermediary maintains the seller's control policies through smart contracts that automatically enforce pricing rules, demand limits, and resale restrictions without slowing down the actual transaction processing

Inventive Principle:

Principle #24Intermediary (Mediator)

2Reliability

If sellers implement authentication and registration systems to control bulk purchases, then fraud detection improves, but transaction complexity and time consumption increase

Engineering Contradiction:

Improvefraud detection capabilityVSAvoidauthentication system complexity

Core Design Contradiction:

ReliabilityVSDevice complexity

Solution Approach 1:

The system uses cryptographic copies (digital signatures and hashed identifiers) of buyer identities stored on the blockchain instead of complex authentication systems. These cryptographic copies enable fraud detection and buyer tracking without requiring cumbersome registration and verification procedures for each transaction

Inventive Principle:

Principle #26Copying

Solution Approach 2:

Manual authentication and verification processes are replaced with automated cryptographic verification through smart contracts. The blockchain network itself performs the verification of buyer identities and enforcement of purchase limits, eliminating the need for complex centralized authentication systems

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

3Productivity

If automated bots are deployed for bulk purchasing, then large quantities of products can be acquired quickly, but primary market sellers cannot adjust pricing or limit quantities in response

Engineering Contradiction:

Improvebulk purchase speedVSAvoidseller response time to demand changes

Core Design Contradiction:

ProductivityVSLoss of time

Solution Approach 1:

The system pre-configures smart contracts with the seller's pricing policies, demand thresholds, and quantity limits before any transactions occur. When bots attempt bulk purchases, these pre-established rules are automatically enforced, allowing the seller to maintain control without needing to respond in real-time to rapid purchasing attempts

Inventive Principle:

Principle #10Preliminary action

Solution Approach 2:

The blockchain network provides real-time feedback on purchase patterns, inventory levels, and pricing conditions to the seller's system, enabling automated adjustment of control parameters that are then immediately enforced through smart contracts, effectively countering bot-driven bulk purchases

Inventive Principle:

Principle #23Feedback

4Adaptability or versatility

If secondary markets are allowed for reselling products, then consumer flexibility increases, but sellers cannot verify authenticity and fraud detection becomes difficult

Engineering Contradiction:

Improveresale flexibilityVSAvoidproduct authenticity verification

Core Design Contradiction:

Adaptability or versatilityVSReliability

Solution Approach 1:

Each product is assigned a unique cryptographic identifier and ownership history recorded on the blockchain. Resellers can transfer products freely, but the blockchain maintains an immutable copy of the ownership chain, enabling automatic verification of authenticity and legitimate ownership without restricting resale flexibility

Inventive Principle:

Principle #26Copying

Solution Approach 2:

The blockchain acts as an intermediary verification layer between buyers and resellers. It automatically validates the authenticity of products and the legitimacy of resale transactions through smart contracts, allowing flexible secondary markets while maintaining seller control and fraud prevention

Inventive Principle:

Principle #24Intermediary (Mediator)

Data Source

PatentUS12039529B1Closed loop blockchain gateway system

Publication Date: 2024.07.16 PLATINUM DIGITAL TECHNOLOGIES INC

AI summary

Exemplary embodiments described herein include a closed loop gateway. The closed-loop gateway comprises a block chain system for tracking exchanges between users of the closed-loop gateway. The closed-loop gateway permits the exchanges to be tracked from an original source through subsequent users to permit the original source to impose conditions, restrictions, and rules on the subsequent exchanges.