Semi-Private Blockchain Virtual Currency Exchange

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Solution Overview

Problem

Existing blockchain systems for virtual currency exchange lack flexibility and security in facilitating transactions between unaffiliated merchants and customers, while also overloading computational resources and failing to provide widespread access and cost-efficient authenticity of rewards points.

Innovation Solution

A semi-private blockchain virtual currency exchange system where merchant nodes, associated with specific merchants, create and manage virtual currency units, allowing for secure and efficient transactions and exchanges between customer accounts, with validation and recording processes distributed across unaffiliated merchant nodes.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Adaptability or versatility

If a public blockchain system is used to facilitate virtual currency exchange, then access is open to all participants, but computational power requirements become excessive and privacy/security are compromised

Engineering Contradiction:

Improveaccess to systemVSAvoidcomputational power consumption

Core Design Contradiction:

Adaptability or versatilityVSUse of energy by moving object

Solution Approach 1:

The patent implements a semi-private blockchain where different participants have different levels of access and privileges. Merchant nodes can create and manage virtual currencies for their merchants, while customer nodes can participate in transactions. This local differentiation of rights and responsibilities reduces the computational burden on individual nodes while maintaining broad participation capability.

Inventive Principle:

Principle #3Local quality

Solution Approach 2:

The system segments participants into different types (merchant nodes and customer nodes) with distinct capabilities. Merchant nodes have exclusive rights to create their specific virtual currencies, while customer nodes can transact but not create currencies. This segmentation allows the system to scale without requiring all participants to perform computationally intensive operations.

Inventive Principle:

Principle #1Segmentation

2Reliability

If a private blockchain system is used to restrict participant authorization, then security and control are improved, but flexibility and widespread access are reduced

Engineering Contradiction:

Improvesecurity and controlVSAvoidwidespread access

Core Design Contradiction:

ReliabilityVSAdaptability or versatility

Solution Approach 1:

The patent creates a dynamic access control model where participants can be added to or removed from the blockchain network as needed. The system maintains security through controlled authorization while enabling flexible onboarding of new merchants and customers. The semi-private nature allows the system to adapt to changing business requirements without compromising the integrity of the ledger.

Inventive Principle:

Principle #15Dynamics

3Extent of automation

If existing blockchain systems are used to facilitate rewards point exchanges, then transaction recording is distributed, but authenticity validation becomes insufficient and costs become excessive

Engineering Contradiction:

Improvedistributed transaction recordingVSAvoidauthenticity validation

Core Design Contradiction:

Extent of automationVSReliability

Solution Approach 1:

The patent introduces virtual currencies as intermediary tokens that represent rewards points from different merchants. These virtual currencies can be exchanged between customers and merchants through the blockchain system. The intermediary virtual currency layer simplifies authenticity validation by providing a standardized framework for verifying rewards point transactions across different merchant systems.

Inventive Principle:

Principle #24Intermediary (Mediator)

Data Source

PatentUS12141768B2Semi-private blockchain virtual currency exchange systems

Publication Date: 2024.11.12 CAPITAL ONE SERVICES LLC

AI summary

A first merchant node on a semi-private blockchain virtual currency exchange system is exclusively capable of creating first virtual currency units. Unaffiliated merchant node(s) are exclusively capable of creating other merchant-specific virtual currency units in the system, while customer computing devices are incapable of creating virtual currency units. The first merchant node creates and issues first virtual currency units to a first customer account associated with a first customer computing device. Upon receiving a transaction request for exchanging first virtual currency unit(s) for a second currency type between the first customer account and another customer account, the first merchant node validates the first transaction request, and creates and sends a first transaction receipt to unaffiliated merchant node(s). Upon receiving a redemption request from a customer account, the first merchant node validates the first redemption request, and creates and sends a first redemption receipt to unaffiliated merchant node(s).