Blockchain Transaction Linking via Intermediary Payment Network
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Solution Overview
Problem
Blockchain transactions face challenges due to their slow processing times and lack of integration with traditional payment systems, which can lead to security issues for payees and difficulties for consumers and merchants in verifying identities and managing blockchain currency.
Innovation Solution
A system and method for linking blockchain transactions to privately verified identities by storing account profiles in a database and processing transaction messages to associate transaction identifiers with personal and merchant identifiers, allowing for faster processing and enhanced security through integration with traditional payment networks.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If blockchain transactions are processed using traditional blockchain verification methods, then security and anonymity are maintained, but processing time increases significantly (around ten minutes)
Solution Approach 1:
The patent introduces a payment network as an intermediary layer between blockchain transactions and traditional payment systems. This payment network includes a processing server that can identify and process transactions without requiring full blockchain verification, thereby reducing processing time while maintaining security through the intermediary's verification mechanisms
Solution Approach 2:
The system segments the transaction processing into two paths: high-value transactions that require full blockchain verification for security, and low-value transactions that can be processed quickly through the payment network. This segmentation allows the system to maintain security where needed while achieving fast processing for routine transactions
2Reliability
If blockchain transactions remain anonymous without identity linkage, then privacy is protected, but fraud detection and risk assessment capabilities are limited
Solution Approach 1:
The patent applies local quality by selectively linking identities to transactions based on risk factors. High-value or suspicious transactions have their identities verified and linked to account profiles for fraud detection, while routine low-value transactions maintain anonymity. This localized application of identity verification provides fraud detection capability where needed without compromising privacy overall
Solution Approach 2:
The system performs preliminary identity verification and risk assessment before transactions are finalized. The payment network pre-evaluates transactions using fraud detection algorithms and links identities in advance when necessary, allowing for quick fraud detection without requiring post-transaction identity investigation
3Productivity
If traditional payment network infrastructure is integrated with blockchain, then processing speed and security are improved, but system complexity increases
Solution Approach 1:
The payment network is designed with multi-functionality to handle both traditional payment processing and blockchain transaction verification. The processing server can identify transactions, evaluate risk, and process payments through a unified system that works with both fiat and cryptocurrency, reducing the need for separate specialized systems
Solution Approach 2:
The patent uses copying by creating simplified representations of blockchain transactions that can be processed by traditional payment network infrastructure. Instead of requiring the entire blockchain verification process, the system creates copy representations of transaction data that fit within existing payment network protocols, thereby reducing integration complexity
Data Source
AI summary
A method for linking blockchain transactions to privately verified identities includes: storing account profiles, each profile including data related to a transaction account including an account identifier and account data; receiving a transaction message, the message including a first data element configured to store a personal account number, a second data element configured to store a merchant identifier, and a third data element configured to store a blockchain network identifier; identifying a first account profile that includes the personal account number; identifying a second account profile that includes the merchant identifier; receiving a transaction notification, the notification indicating a transaction processed using a blockchain network associated with the blockchain network identifier and including a transaction identifier and an address identifier associated with the first or second account profile; and storing a linkage between the transaction identifier and the address identifier, the personal account number, and/or the merchant identifier.