Deposit Tokenization Service Using Verifiable Credentials
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Solution Overview
Problem
Current systems for deposit tokens lack efficient mechanisms for identity verification, sanctions screening, and transfer control across different blockchain networks, which hinders secure and compliant tokenization, transfer, and redemption processes.
Innovation Solution
Implementing a method that uses verifiable credentials and information oracles for identity verification and sanctions screening, enabling secure tokenization, transfer, and redemption of deposit tokens across single or multi-chain blockchain networks, with mechanisms for on-chain transfer controls and interest distribution.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If traditional identity verification and sanctions screening methods are used for deposit tokens, then security and compliance are maintained, but the system lacks efficiency and cannot operate across multiple blockchain networks
Solution Approach 1:
The patent introduces verifiable credentials as intermediary objects that mediate between identity verification systems and blockchain networks. These credentials enable automated, trustless verification of identity and sanctions status, eliminating the need for manual screening processes while maintaining security and compliance standards across multiple blockchain networks.
Solution Approach 2:
The patent creates a universal verifiable credential system that can be applied across different blockchain networks (public, private, consortium) and different types of deposit tokens. This multi-functional approach allows the same verification mechanism to serve security, compliance, and efficiency requirements simultaneously across diverse network environments.
2Ease of operation
If manual identity verification and sanctions screening processes are implemented, then control over token flow is maintained, but the tokenization and transfer processes become slow and inefficient
Solution Approach 1:
The patent implements self-service verification where deposit tokens automatically present their verifiable credentials to smart contracts during transfer operations. The tokens themselves carry their identity and compliance information, enabling autonomous verification without manual intervention. This maintains control through programmable smart contract rules while eliminating time-consuming manual processes.
Solution Approach 2:
The patent performs identity verification and sanctions screening in advance during the token issuance phase, embedding verifiable credentials into the deposit tokens before they enter circulation. This preliminary action ensures compliance is established upfront, allowing rapid transfers later without repeated manual screening delays.
3Productivity
If verifiable credentials and information oracles are integrated into the tokenization system, then identity verification and sanctions screening become automated and efficient, but the system complexity increases
Solution Approach 1:
The patent uses verifiable credentials as intermediary objects that simplify the system architecture by providing a standardized interface between identity verification systems and blockchain networks. Rather than building complex custom verification systems for each blockchain, the credential intermediary provides a universal solution that reduces overall system complexity while enabling automation.
4Adaptability or versatility
If the system supports transfer of deposit tokens across different blockchain networks, then versatility and adaptability are improved, but the mechanisms for maintaining security and compliance become more complex
Solution Approach 1:
The patent creates a universal verifiable credential system that functions across different blockchain network types (public, private, consortium). The same credential structure and verification logic can be applied universally across chains, providing adaptability for cross-chain transfers without requiring complex chain-specific verification mechanisms for each network type.
Data Source
AI summary
Systems and methods for using single or multi-chain deposit tokens are disclosed. According to an embodiment, a method for deposit tokenization may include: (1) receiving, by a deposit tokenization service for a token issuer and from an authorized party, an instruction for tokenizing an amount of non-tokenized funds in a deposit account; (2) verifying, by the deposit tokenization service, an identity of the authorized party using a verifiable credential; (3) screening, by the deposit tokenization service and using an information oracle, the deposit account and/or the verifiable credential; (4) debiting, by the deposit tokenization service, the deposit account for the amount and crediting the amount to an omnibus account; (5) tokenizing, by the deposit tokenization service, the amount of the non-tokenized funds on a blockchain network as deposit tokens; and (6) crediting, by the deposit tokenization service, a wallet address on the blockchain network with the deposit tokens.