Overlay Ledger Banking for Interest-Bearing MBC Deposits
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Solution Overview
Problem
Existing math-based currency (MBC) systems lack integration with traditional banking services, preventing financial institutions from securely managing and utilizing MBC for deposit services, interest accrual, credit services, and insurance, while maintaining user anonymity and security.
Innovation Solution
A banking system that includes a financial institution with a pooled database of private and public key pairs for MBC, an overlay ledger to track customer accounts, and network interfaces for transaction processing, allowing secure deposit, withdrawal, and credit services while maintaining user anonymity.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Loss of information
If MBC is transferred anonymously using private keys without financial institution involvement, then user privacy and transaction speed are improved, but security management and regulatory compliance deteriorate
Solution Approach 1:
The patent introduces a financial institution as an intermediary that receives MBC deposits, verifies user identities, and maintains ledger records. This intermediary structure preserves user privacy by not requiring public disclosure of transactions while enabling secure management through institutional oversight, regulatory compliance, and insured deposits. The financial institution acts as the mediator between anonymous MBC transfers and regulated financial systems.
2Ease of operation
If wallet applications store private keys locally, then user control and transaction speed are improved, but security against theft and loss deteriorates
Solution Approach 1:
The patent combines local user control with institutional security by having users deposit MBC into financial institutions while maintaining the ability to withdraw. The private keys remain under user control for withdrawal operations, while the financial institution provides secure storage, insurance, and protection against theft or loss. This merging approach allows users to benefit from both decentralized control and centralized security measures.
3Adaptability or versatility
If financial institutions integrate MBC deposit services, then service versatility and economic utility are improved, but system complexity and operational difficulty increase
Solution Approach 1:
The patent segments the MBC system into distinct functional layers: the cryptographic layer for anonymous transfers, the ledger layer for record-keeping, and the financial institution layer for regulated services. This segmentation allows each layer to operate independently with its own complexity management, enabling financial institutions to offer versatile MBC services without overwhelming system complexity. The overlay ledger specifically handles the interface between anonymous transactions and regulated financial services.
Data Source
AI summary
Systems, methods, and computer-readable storage media for interest allocation to math based currency (MBC) at a financial institution. One method includes storing a plurality of private and public key pairs in a pooled account key storage associated with a total amount of MBC. The method further includes tracking an association of an amount of MBC with each of a plurality of MBC accounts of a plurality of customers stored on an overlay ledger. The method further includes calculating an amount of interest earned on an amount of MBC. The method further includes updating a first entry of the overlay ledger. The method further includes purchasing an additional amount of MBC associated with a private and public key pair. The method further includes transferring the private and public key pair into the pooled account key storage.