Secure Onboarding Unit for Fraud-Resistant Token Transactions
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Solution Overview
Problem
Electronic transaction systems face challenges in preventing fraudulent behavior, such as multiple account creation, and ensuring user privacy, particularly due to the increasing complexity and scale of transactions, which requires robust security measures to protect sensitive financial data.
Innovation Solution
A secure onboarding unit within the electronic token transaction system generates unique onboarding IDs by hashing participant ID data and verifies their uniqueness using a lossy compressed data structure, preventing duplicate accounts and enhancing privacy through compact storage that prevents direct reconstruction of original data.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If traditional onboarding methods are used to allow participants to join the system, then ease of operation is improved, but fraudulent multiple account creation increases
Solution Approach 1:
The patent introduces an onboarding unit as an intermediary component between the participant and the transaction system. This unit generates unique onboarding IDs by hashing participant ID data and verifies their uniqueness using a lossy compressed data structure. The onboarding unit acts as a mediator that prevents multiple account creation while maintaining simple onboarding procedures, resolving the contradiction between ease of operation and account uniqueness reliability.
Solution Approach 2:
The patent creates a hashed copy of the participant ID data to generate the onboarding ID. Instead of storing the original ID data, the system uses the hash value as the unique identifier. This copying approach ensures that even if the same participant tries to create multiple accounts, the hashed ID will be detected as duplicate, preventing fraudulent behavior while maintaining operational simplicity.
2Ease of operation
If participant ID data is stored in plain text for easy access, then ease of operation is improved, but user privacy is compromised
Solution Approach 1:
The patent applies hashing to create a copied version of the participant ID data. The original ID data is never stored in plain text; instead, only the hashed version is stored in the onboarding repository. This copying approach maintains data accessibility for verification purposes while preventing privacy breaches, as the hash function is one-way and cannot be reversed to obtain the original data.
Solution Approach 2:
The onboarding unit serves as an intermediary that handles all data access operations. It receives participant ID data, generates hashed onboarding IDs, and stores only the hashes in the repository. This intermediary layer prevents direct access to plain text ID data while maintaining operational functionality, thus protecting user privacy without compromising ease of operation.
3Reliability
If a comprehensive database of all onboarding IDs is stored for uniqueness verification, then reliability of fraud prevention is improved, but data storage requirements increase
Solution Approach 1:
The patent changes the parameter of data representation from full ID data to hashed onboarding IDs. By using hash functions, the system compresses the data representation while maintaining uniqueness verification capability. This parameter change reduces the storage volume significantly compared to storing complete ID data, while still providing reliable fraud prevention through uniqueness checks.
Solution Approach 2:
The patent stores only the hashed copy of the onboarding ID in the database rather than the original ID data. This copying approach reduces the quantity of data that needs to be stored while maintaining the ability to verify uniqueness. The hash function creates a compact representation that is sufficient for fraud prevention without requiring extensive storage space.
4Ease of operation
If simple uniqueness checking is performed without compression, then ease of operation is improved, but storage efficiency decreases
Solution Approach 1:
The patent changes the data representation parameter by using hashed onboarding IDs instead of raw ID data. This parameter change enables compact storage while maintaining simple verification operations. The hash function creates a condensed representation that fits efficiently in storage structures like Bloom filters, achieving both storage efficiency and operational simplicity.
Solution Approach 2:
The patent uses hashed copies of onboarding IDs for storage and verification. This copying approach creates compact data representations that are easy to store and verify. The hash function produces a condensed version of the ID data that can be efficiently managed in the onboarding repository, achieving both storage efficiency and ease of operation.
Data Source
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AI summary
The invention relates to a secure onboarding unit (200) within an electronic token transaction system (100). The onboarding unit comprises: an onboarding repository (202) configured to store a plurality of onboarding IDs for registered participants (106) in the electronic token transaction system (100); means (206) for accessing the onboarding repository (202); and means (210, 208, 204) adapted to: i) receive an onboarding request from a participant (106) of the electronic token transaction system (100), the onboarding request comprising ID data of the participant (106) and/or of a transaction unit (108) of the participant (106); ii) generate an onboarding ID by hashing the ID data, and iii) verify the uniqueness of the generated onboarding ID against the onboarding repository (202) in a privacy-enhancing manner using a lossy compressed data structure, thereby reducing the risk of fraudulent multiple onboarding IDs and/or customer accounts.