Blockchain Tokenized Micropayments for Contract-Linked Transactions
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Solution Overview
Problem
Existing micropayment channels on blockchain platforms decouple the asset transfer from the agreement between the customer and merchant, making it difficult for the merchant to demonstrate the correlation between the agreement and blockchain transactions, especially in cases of disagreement or unauthorized activity.
Innovation Solution
Implementing a tokenization method using machine-executable smart contracts and micropayment channels, where tokens represent the asset transfer and include cryptographic signatures to ensure the asset is tied to the agreement, allowing automated and conditional transfer of assets via blockchain transactions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If micropayment channels are used to enable automated payments, then payment efficiency is improved, but the correlation between the agreement and blockchain transactions is lost
Solution Approach 1:
The patent introduces tokens as intermediary objects that carry information about the agreement between customer and merchant. These tokens are embedded in blockchain transactions, serving as a mediator that preserves the correlation between the original agreement and the automated micropayment executions, while still enabling efficient automated payments through the micropayment channel mechanism
2Reliability
If tokens are embedded in blockchain transactions to represent assets, then asset transfer is linked to the agreement, but transaction complexity increases
Solution Approach 1:
The patent creates simplified copies of agreement information in the form of tokens that can be easily embedded in blockchain transactions. Rather than embedding complex agreement documents, the system uses compact token representations that capture the essential agreement terms, thereby maintaining reliable asset transfer linkage while minimizing transaction complexity
3Reliability
If manual intervention is required to demonstrate agreement correlation, then dispute resolution capability is improved, but operational efficiency decreases
Solution Approach 1:
The patent implements a self-service mechanism where the token embedded in the blockchain transaction automatically provides the correlation information needed for dispute resolution. The system serves itself by containing all necessary agreement references within the transaction structure, eliminating the need for manual intervention to demonstrate agreement correlation while maintaining full dispute resolution capability
Data Source
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AI summary
At a computer of a first user, a contract with a second user and a token representing the contract are selected, wherein the token is contained in an output of a minting transaction published to the blockchain, and a funding transaction is generated comprising at least one first input representing the token, and at least one first output representing a first amount payable to the first user by providing a cryptographic signature of the first user and a cryptographic signature of the second user. The funding transaction is signed and sent it to the second user. On receiving an indication from the second user that a payment is required, the computer of the first user (a) generates a first replaceable transaction having at least one second input representing the first amount, at least one second output representing a second amount payable to the second user by providing a cryptographic signature of the first user and a cryptographic signature of the second user, and at least one third output representing the token, and (b) signs the first replaceable transaction and sends it to the second user. On receiving a further indication from the second user that a further payment is required, the computer of the first user updates the second amount in response to the further payment required, and repeats steps (a) and (b) to replace the first replaceable transaction.