Gated Blockchain Protocol for Compliance Verification
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Solution Overview
Problem
Public blockchains face challenges in adhering to specific industry requirements, particularly regarding access control and compliance, due to their permissionless and anonymous nature, which can lead to issues in certain applications where agency and interaction with resources need to be strictly managed.
Innovation Solution
A computer-implemented method involving a gated autonomous program protocol on a blockchain that exchanges blockchain units with wrapped units, verifies accounts against specified gating requirements, and issues on-chain verification proofs to ensure compliant transactions, utilizing an oracle machine for off-chain verification and non-fungible tokens for secure representation.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If public blockchains are used with permissionless and anonymous nature, then accessibility and decentralization are improved, but compliance and access control capabilities deteriorate
Solution Approach 1:
The patent introduces verification proofs as an intermediary mechanism between the permissionless blockchain and compliance requirements. These proofs act as mediators that enable regulated entities to interact with the blockchain while maintaining anonymity, thus preserving accessibility while achieving compliance through the intermediary verification layer.
Solution Approach 2:
The patent segments the blockchain interaction into two distinct layers: the base layer that maintains permissionless accessibility, and the verification layer that enforces compliance through gating requirements. This segmentation allows each layer to fulfill its specific function without compromising the other, resolving the contradiction between accessibility and compliance.
2Reliability
If gated requirements are implemented for account verification, then access control and compliance are improved, but system complexity increases
Solution Approach 1:
The verification autonomous program protocol automatically verifies accounts against gating requirements and issues verification proofs without requiring manual intervention. This self-service mechanism reduces operational complexity while maintaining robust access control, as the system autonomously handles the verification process.
Solution Approach 2:
The patent implements gating requirements as configurable parameters that can be adjusted without changing the underlying system architecture. By making access control criteria parameterizable, the system can adapt to different compliance requirements while maintaining a consistent core structure, thereby reducing the perceived complexity.
3Reliability
If on-chain verification proofs are issued and stored, then transaction security and compliance verification are improved, but blockchain storage requirements and transaction overhead increase
Solution Approach 1:
The verification autonomous program protocol creates on-chain copies of verification proofs that reference off-chain verification data. These compact on-chain copies serve as sufficient evidence for transaction validation without requiring storage of the complete verification datasets, thus reducing storage requirements while maintaining security.
Solution Approach 2:
The verification proof acts as an intermediary data structure that bridges off-chain verification and on-chain transaction validation. By storing only the essential verification evidence on-chain rather than complete verification records, the system reduces storage overhead while maintaining the security and compliance verification functions.
Data Source
AI summary
A process may cause a gated autonomous program protocol to be stored on a blockchain. The gated autonomous program protocol is configured to exchange a blockchain unit with a gated wrapped blockchain unit that is exchangeable among blockchain addresses that satisfy one or more gating requirements. The process may verify that an account associated with a particular blockchain address of the blockchain satisfies the one or more gating requirements. The process may cause an issuance of an on-chain verification proof to the particular blockchain address. The on-chain verification proof may be stored on the blockchain as an on-chain representation that the particular blockchain address is verified with the one or more gating requirements. The gated autonomous program protocol verifies the on-chain verification proof before approving a transaction request associated with the gated wrapped blockchain unit that is initiated by the particular blockchain address.