NFT Protection Architecture for Secure, Fast Off-Chain Exchanges
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Solution Overview
Problem
Existing digital asset exchange systems lack robust security and authorization checks, making digital assets vulnerable to compromise and exposure of private information, and NFT exchanges are slow and resource-intensive due to reliance on blockchain verification.
Innovation Solution
A protection architecture using overlay ledgers and blockchain storage to track NFT ownership, with secure containers and cold storage objects to protect assets, and dynamic non-fungible token (DNFT) instruments for real-time updates, eliminating the need for blockchain transfers.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If NFT exchanges rely on blockchain verification, then security and authenticity are ensured, but exchange speed is slow and resource consumption is high
Solution Approach 1:
The system divides the NFT exchange process into two separate ledgers: a blockchain ledger for storing secure NFT data and authenticity verification, and an overlay ledger for processing fast exchanges and tracking ownership. This segmentation allows each ledger to optimize for its specific function, with the overlay ledger enabling rapid exchanges without blocking the blockchain for verification.
Solution Approach 2:
The overlay ledger acts as an intermediary between the blockchain and the user. It maintains a mapping between overlay ledger accounts and blockchain addresses, allowing exchanges to be processed quickly on the overlay ledger while the blockchain provides the underlying security and authenticity guarantees. This intermediary layer eliminates the need for every exchange to go through blockchain verification.
2Ease of operation
If private keys and metadata are stored on blockchain, then accessibility is provided, but security and exposure to hackers increase
Solution Approach 1:
The system extracts sensitive data including private keys and metadata from the blockchain storage and moves them to secure off-chain storage. The blockchain only stores hashed versions of this data and references to secure storage locations. This extraction removes the harmful element (exposure to hackers) while maintaining accessibility through the overlay ledger's mapping mechanisms.
Solution Approach 2:
The system creates a copy of the NFT ownership and transaction history on the overlay ledger, which is updated in real-time during exchanges. This copy maintains the operational accessibility and history tracking functions while the original sensitive data remains secured off-chain. The overlay ledger provides a synchronized view without exposing the underlying private keys.
3Reliability
If traditional NFT exchange requires blockchain transfers, then authenticity is verified, but gas fees and resource requirements increase
Solution Approach 1:
The system performs partial action by only updating the overlay ledger during exchanges, rather than requiring full blockchain transfers. The overlay ledger maintains its own state and can process exchanges independently, performing only the necessary updates in this layer while the blockchain provides the foundational authenticity verification without requiring resource-intensive transfers for each exchange.
Data Source
AI summary
Systems, methods, and computer-readable storage media to protect non-fungible tokens (NFTs) using a protection architecture. One method includes protecting the NFT including tracking, utilizing the overlay ledger, an association of NFT ownership of a plurality of NFTs and storing and protecting, utilizing a blockchain storage, the plurality of NFTs. The method further includes receiving an exchange request and exchanging the NFT on us including determining the customers have an NFT account with the overlay ledger and executing an on-us exchange based on updating the overlay ledger.