Offline Protocol for CBDC Networks Using Collateral Chain
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Solution Overview
Problem
Current Central Bank Digital Currency (CBDC) systems require an active network connection for transactions, limiting their use in remote or rural areas where internet access is unavailable, and lack an offline protocol to securely facilitate asset transfers without compromising security.
Innovation Solution
An offline protocol is developed that allows devices without an active connection to participate in CBDC network processes by using a collateral chain and smart contracts to authorize and settle transactions, enabling offline transaction messages to be created, transferred, and validated without an internet connection, ensuring security and reliability.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If an active network connection is required for CBDC transactions, then security and validation can be maintained, but accessibility to remote or rural areas is limited
Solution Approach 1:
The system performs preliminary actions by generating offline transaction messages with embedded cryptographic signatures and validation data before disconnection. The payor device creates a signed transaction message containing all necessary validation information, allowing the transaction to be validated later without requiring real-time network connection. This preliminary preparation enables offline transactions while maintaining security through pre-established cryptographic proofs.
Solution Approach 2:
The patent introduces an offline transaction message as an intermediary carrier that transfers transaction information between devices without requiring active network connection. This message contains embedded cryptographic signatures and validation data that act as intermediaries to prove transaction legitimacy. The message serves as a self-contained proof mechanism that bridges the gap between offline operation and online validation requirements.
2Adaptability or versatility
If offline transaction messages are created without network connection, then accessibility is improved, but validation and security verification become difficult
Solution Approach 1:
The system implements feedback mechanisms where the offline transaction message contains embedded cryptographic signatures and validation data that provide self-verifying feedback about transaction legitimacy. When the message is presented online, the network can verify the embedded signatures against known public keys, providing immediate feedback on validation status. This feedback mechanism enables easy detection and verification of offline transactions without requiring complex validation procedures.
Solution Approach 2:
Validation data and cryptographic proofs are prepared in advance and embedded within the offline transaction message itself. This preliminary inclusion of validation information eliminates the need for complex real-time verification procedures when the transaction is presented online. The message contains all necessary proof elements pre-computed and ready for verification, making detection and validation straightforward through cryptographic verification algorithms.
3Reliability
If collateral chain is used to link accounts, then transaction settlement reliability is improved, but system complexity increases
Solution Approach 1:
The patent resolves complexity by transitioning from horizontal peer-to-peer account relationships to a vertical hierarchical dimension. Accounts are organized in a tree structure with root accounts at the top and leaf accounts at the bottom, creating a clear hierarchical dimension. This dimensional change allows the system to manage complex relationships through a structured hierarchy where each account has a defined position and authority level, making the collateral chain more manageable and understandable while maintaining settlement reliability.
Solution Approach 2:
The collateral chain is segmented into discrete hierarchical levels with root accounts, intermediate accounts, and leaf accounts. Each segment (account level) has specific responsibilities and authority boundaries. Root accounts manage collateral, intermediate accounts facilitate transfers, and leaf accounts represent end users. This segmentation divides the complex collateral management into manageable segments with clear roles, reducing overall system complexity while maintaining settlement reliability through the structured hierarchy.
Data Source
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AI summary
The invention provides techniques for enabling offline devices that do not have an active connection to an account-based CBDC network to participate in CBDC network processes such as asset transfers. This is enabled by defining an offline protocol that governs the handling of such processes in an offline state. A collateral chain is provided by the CBDC network that links together multiple accounts so that an account lower down in the collateral chain can be used to settle a transaction in the case where an account higher up the chain does not hold sufficient CBDC to settle the transaction. On the device side, offline transaction messages are exchanged that enable either device to commit the transaction to the CBDC network once the device obtains an active connection to the CBDC network.