Permissioned Blockchain Digital Currency for Enterprise Banking

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Solution Overview

Problem

Current cryptocurrency systems lack centralized control and regulation, leading to issues such as inflationary effects, security vulnerabilities, and inability to seamlessly integrate with traditional currencies, which hinders their adoption in mainstream financial systems and poses challenges for governments and financial institutions.

Innovation Solution

A private permissioned blockchain system that allows central authorities and financial institutions to create and control digital fiat currency, using electronic tokens with unique digital security features, enabling secure and convenient transactions while maintaining compatibility with real-world currencies through a network of qualified banks and secure minting processes.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Reliability

If decentralized cryptocurrency systems are used, then independence from central banks and security are improved, but regulatory control and stability deteriorate

Engineering Contradiction:

ImprovesecurityVSAvoidregulatory control

Core Design Contradiction:

ReliabilityVSObject-affected harmful factors

Solution Approach 1:

The patent introduces a hybrid model where financial institutions act as intermediaries between decentralized blockchain technology and centralized regulation. The system allows regulated access to blockchain features while maintaining governmental oversight through permissioned networks and centralized control of key parameters.

Inventive Principle:

Principle #24Intermediary (Mediator)

Solution Approach 2:

The system applies different levels of decentralization to different aspects: transaction execution remains decentralized for security, while currency issuance and monetary policy remain centralized for regulatory control. This creates a multi-level governance structure where appropriate control is applied locally to each function.

Inventive Principle:

Principle #3Local quality

2Adaptability or versatility

If decentralized cryptocurrency mining is used, then independence and privacy are improved, but inflationary effects and security vulnerabilities worsen

Engineering Contradiction:

ImproveindependenceVSAvoidinflationary effects

Core Design Contradiction:

Adaptability or versatilityVSObject-generated harmful factors

Solution Approach 1:

The system changes the fundamental parameter of currency creation from decentralized mining to centralized issuance. Instead of allowing anyone to mine currency through computational puzzles, the system uses controlled minting by authorized financial institutions, thereby eliminating uncontrolled inflation while preserving digital currency independence.

Inventive Principle:

Principle #35Parameter changes

3Reliability

If traditional physical currencies are used, then regulatory control and stability are improved, but conversion efficiency and technological integration worsen

Engineering Contradiction:

ImprovestabilityVSAvoidconversion efficiency

Core Design Contradiction:

ReliabilityVSProductivity

Solution Approach 1:

The patent replaces the mechanical physical currency system with an electronic digital system. Instead of physical coins and notes requiring printing, distribution, and physical handling, the system uses electronic tokens on a blockchain, enabling instant conversion and eliminating friction in transactions while maintaining regulatory oversight.

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

4Object-affected harmful factors

If permissioned blockchain systems are used, then regulatory compliance and control are improved, but ease of operation and accessibility worsen

Engineering Contradiction:

Improveregulatory complianceVSAvoidaccessibility

Core Design Contradiction:

Object-affected harmful factorsVSEase of operation

Solution Approach 1:

The system segments user access into different permission levels: full access for authorized financial institutions, limited access for regulated entities, and read-only access for the general public. This segmentation allows regulatory compliance while maintaining operational ease for authorized users through automated verification and simplified interfaces.

Inventive Principle:

Principle #1Segmentation

Data Source

PatentUS11816642B2Blockchain digital currency: systems and methods for use in enterprise blockchain banking

Publication Date: 2023.11.14 WASSERMAN STEVEN VICTOR

AI summary

Methods and systems for using blockchain digital currency are provided herein. The methods and systems comprise a blockchain digital currency that is created and utilized on a permission-based network of financial institutions. The blockchain digital currency is created by a central authority and minted into circulation by banks within the network, and is backed by reserves of real world currency of any country. The digital currency can be used for any type of financial transaction, and the system provides security, trust, traceability and a detailed audit trail for all transactions.