Offline Protocol for CBDC Networks Using Collateral Chain
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Solution Overview
Problem
Current Central Bank Digital Currency (CBDC) systems require an active network connection for transactions, limiting their use in remote or rural areas where internet access is scarce, and lack an offline protocol to securely facilitate asset transfers without compromising security.
Innovation Solution
An offline protocol is developed that allows devices without an active connection to participate in CBDC network processes by using a collateral chain to settle transactions and cryptographic techniques for secure message handling, enabling offline transaction creation, transfer, and future settlement.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If an active network connection is required for CBDC transactions, then transaction security and validation can be maintained, but accessibility and inclusivity are limited to areas with network coverage
Solution Approach 1:
The system performs preliminary actions by pre-validating transactions offline and preparing them for later settlement. The offline protocol allows devices to create and validate transactions locally before network connection is established, then queue these transactions for asynchronous settlement when connectivity is available, eliminating the need for continuous network connection while maintaining security.
Solution Approach 2:
The patent introduces an intermediary mechanism - the offline protocol layer - that mediates between offline devices and the online CBDC network. This intermediary enables devices to operate independently offline while automatically synchronizing with the network when connected, thus bridging the gap between accessibility requirements and security validation needs.
2Adaptability or versatility
If offline transaction protocol is implemented, then accessibility in remote areas is improved, but system complexity increases due to additional protocol requirements
Solution Approach 1:
The system segments the transaction process into distinct phases: offline creation phase where devices independently validate and prepare transactions, and online settlement phase where these pre-validating transactions are processed by the CBDC network. This segmentation allows devices to have simplified local validation logic while the network handles the complex settlement coordination, distributing complexity appropriately.
Solution Approach 2:
Offline devices perform self-service by independently validating transactions and managing their own state without requiring continuous network connection. The devices autonomously create, validate, and queue transactions locally, reducing the complexity burden on the network infrastructure while maintaining accessibility.
3Ease of operation
If transactions are settled asynchronously offline, then operational flexibility and usability are improved, but coordination and settlement reliability become more challenging
Solution Approach 1:
The system implements feedback mechanisms where the CBDC network acknowledges received offline transactions and provides status information back to devices. This feedback loop ensures that devices can track the settlement status of their transactions, and the network can confirm successful processing, maintaining reliability despite the asynchronous nature of offline settlement.
Solution Approach 2:
By performing preliminary validation and preparation of transactions offline before settlement, the system ensures that all necessary checks and verifications are completed in advance. This preliminary action reduces the complexity of coordination during settlement, as the network only needs to process pre-validating transactions rather than performing all validation in real-time.
Data Source
AI summary
The invention provides techniques for enabling offline devices that do not have an active connection to an account-based CBDC network to participate in CBDC network processes such as asset transfers. This is enabled by defining an offline protocol that governs the handling of such processes in an offline state. A collateral chain is provided by the CBDC network that links together multiple accounts so that an account lower down in the collateral chain can be used to settle a transaction in the case where an account higher up the chain does not hold sufficient CBDC to settle the transaction. On the device side, offline transaction messages are exchanged that enable either device to commit the transaction to the CBDC network once the device obtains an active connection to the CBDC network.