Hybrid Wallet Secure Element for Blockchain Identity Verification
Find Innovative SolutionsGenerate Solutions
Solution Overview
Problem
Current Blockchain technologies face challenges in combining privacy preservation of Public Blockchains with identity preservation of Private Blockchains, leading to vulnerabilities in cryptocurrency exchanges, trade finance inefficiencies, and centralized IT systems, which are insecure and lack scalability and regulatory compliance.
Innovation Solution
Implementing a system that integrates Cloud-based Identification-as-a-Service (IDaaS) for real-time, multi-factor, malware-resilient strong identification and cryptographic key management, enabling secure interactions between users and marketplace applications using both user-identifiable and anonymous Blockchains, while protecting private keys and ensuring identity verification.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Loss of information
If Public Blockchain is used for cryptocurrency exchanges, then user privacy is preserved, but user identity cannot be verified for regulatory compliance
Solution Approach 1:
The system segments identity information into two parts: public identity (stored on blockchain for verification) and private identity (kept offline in secure element). This segmentation allows the system to provide identity verification for regulatory compliance while preserving user privacy by never exposing the private identity portion.
Solution Approach 2:
The patent introduces an intermediary mechanism (the hybrid wallet system with secure element) that mediates between the need for public verification and private protection. The secure element acts as a trusted intermediary that can verify identity without exposing private information to the public blockchain.
2Reliability
If Private Blockchain with PKI digital certificates is used, then user identity is preserved and verified, but the system cannot be scaled to Public Internet
Solution Approach 1:
The hybrid wallet system serves multiple functions: it operates as a personal wallet for private transactions, as a verification mechanism for regulatory compliance, and as a bridge between public and private blockchain ecosystems. This multi-functionality enables the system to scale across different blockchain types and use cases.
Solution Approach 2:
The system applies different security and verification mechanisms to different contexts: strong PKI-based verification when identity proof is needed, and anonymous public key cryptography when privacy is prioritized. This local quality approach allows the system to adapt its verification strength to the specific requirements of each transaction or interaction.
3Reliability
If centralized marketplace operators process transactions, then transaction security is maintained, but the system lacks decentralization and scalability
Solution Approach 1:
The patent extracts the trust function from centralized marketplace operators and distributes it to individual users through hybrid wallets with secure elements. Each user becomes their own trusted third party, eliminating the need for centralized intermediaries while maintaining transaction security through cryptographic verification.
Solution Approach 2:
The hybrid wallet system enables users to perform their own identity verification and transaction security functions without relying on centralized operators. The secure element in each user's wallet independently verifies identities and secures transactions, empowering users to be self-sufficient in maintaining transaction integrity.
4Ease of operation
If personal wallets with private keys are used, then user control is maintained, but the system is vulnerable to private key attacks
Solution Approach 1:
The system implements beforehand cushioning by storing private keys in a secure element that is specifically designed to resist attacks. The secure element provides pre-established security measures including hardware-based protection and isolated execution environments that cushion against various private key attack vectors before they can compromise the keys.
Solution Approach 2:
The hybrid wallet combines multiple security approaches: software-based key management for ease of operation and hardware-based secure elements for protection. This composite approach integrates the advantages of both soft and hard security measures, maintaining user control while dramatically reducing vulnerability to attacks.
Data Source
AI summary
Electronic network include multiple users. Each user operates Wallet software application on his/her endpoint devices (special purpose, computer or smartphone). Each Wallet integrates with Cloud-based Identification-as-a-Service(s) (IDaaS) In context of present invention—IDaaS provides real-time, multi-factor, malware-resilient, context-sensitive Strong Identification-as-a-Service of the user and enables Cryptographic Keys Management of the Wallet. Each Wallet provides various Cryptographic functionalities. Each Wallet may be connected with multiple centralized Marketplace software applications, thus allowing these Cryptographic functionalities to interact with specific Marketplace software application. Each Wallet may be connected with multiple decentralized peer-to-peer software applications, thus allowing these Cryptographic functionalities to interact with specific peer-to-peer software application. These software applications may include Information Technology, Financial, Manufacturing, Retail, Insurance, Government, Healthcare and other verticals of Global Economy. The present invention prevents “Bad Actors” from using or attacking these applications. The present invention also enables Identification of participants of transactions recorded on Blockchain.