Digital Asset Conversion via Aggregated Exchange Rates
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Solution Overview
Problem
Existing digital asset exchange systems limit users to exchanging digital assets only for fiat currency, physical goods, or a select few digital assets, lacking the capability to convert between different digital assets efficiently and effectively.
Innovation Solution
A system and method that enables the conversion of digital assets between different digital asset user accounts by determining an aggregated conversion rate based on exchange rates with fiat currency, using an identifier token for multiple account management, and executing conversions in real-time, while establishing rate-specific thresholds and limits to control economic dynamics.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If digital asset exchange systems allow conversion between multiple digital assets, then the versatility and adaptability of the system improves, but the complexity of managing exchange rates and transactions increases
Solution Approach 1:
The patent introduces an account management system as an intermediary layer between users and multiple digital asset exchange systems. This intermediary consolidates multiple exchange rate sources and coordinates transactions across different assets, reducing the complexity that would otherwise be directly exposed to users. The system manages the intricate relationships between multiple digital assets and their respective exchange rates through a unified interface.
Solution Approach 2:
The account management system performs multiple functions: it determines aggregated conversion rates across different digital assets, manages user accounts for multiple assets, coordinates transactions between assets, and interfaces with multiple exchange systems. This multi-functional approach consolidates what would otherwise require separate systems for each exchange operation.
2Speed
If real-time conversion rates are provided for multiple digital assets, then the speed and responsiveness of the system improves, but the computational resources and processing time required increase
Solution Approach 1:
The system determines aggregated conversion rates in advance and maintains them ready for quick retrieval during transactions. By pre-calculating and storing conversion rates before actual exchange operations occur, the system avoids performing complex multi-asset rate calculations in real-time during user transactions, thus reducing computational overhead while maintaining fast response times.
3Measurement precision
If individual identifiers are used for multiple digital asset accounts, then the precision of account tracking improves, but the memory storage and processing overhead increases
Solution Approach 1:
The patent merges multiple individual account identifiers into a single unified identifier token that represents the user across all digital asset accounts. Instead of managing separate identifiers for each digital asset account, the system consolidates them under one token, reducing memory storage requirements and simplifying the tracking of user assets across multiple accounts while maintaining precise identification.
Data Source
AI summary
Various embodiments are directed to processing conversions of digital assets to other digital assets. An example method includes determining a source exchange rate for a source digital asset and a fiat currency, determining a target exchange rate for a target digital asset and a fiat currency, and generating an aggregated conversion rate for the source digital asset and the target digital asset using the source exchange rate and the target exchange rate. The method further includes executing a digital asset conversion, which includes causing source digital asset units to be debited from a source digital asset user account and causing target digital asset units to be credited to a target digital asset user account, and subsequently executing fiat currency transactions (e.g., settlements) with a first digital asset exchange system associated with the source digital asset and a second digital asset exchange system associated with the target digital asset.