Cryptocurrency Wallet Verification for Time-Sensitive Transactions
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Solution Overview
Problem
The decentralized and distributed nature of cryptocurrency transactions, particularly the proof-of-work and proof-of-stake verification processes, can take a long time to complete, hindering the execution of time-sensitive transactions such as purchases with expiring offers or bids in auctions.
Innovation Solution
A payment service provider system facilitates time-sensitive cryptocurrency transactions by converting funds from a user's cryptocurrency wallet to a target currency through intermediary transactions, verifying ownership and balance using synchronous or asynchronous methods, and extending credit to complete transactions within the time constraint.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If cryptocurrency transactions use decentralized verification processes (proof-of-work or proof-of-stake), then transaction integrity and security are maintained, but transaction completion time increases significantly
Solution Approach 1:
The system performs preliminary actions by pre-verifying the sender's cryptocurrency balance and ownership before the actual transaction time. The payment service provider checks the distributed ledger in advance to confirm the sender possesses sufficient funds, so that when the transaction is initiated, only the transfer execution is needed rather than full verification, dramatically reducing completion time while maintaining integrity
Solution Approach 2:
The patent introduces a payment service provider as an intermediary between the sender and recipient. This intermediary maintains a trusted relationship with the sender, verifies their balance beforehand, and guarantees payment. The intermediary absorbs the verification burden, allowing the actual transaction to complete quickly without waiting for decentralized network verification, thus resolving the time-integrity contradiction
2Reliability
If cryptocurrency transactions require distributed ledger verification by multiple computer nodes, then transaction security is ensured, but processing speed decreases
Solution Approach 1:
The patent extracts the verification function from the decentralized network and concentrates it in the payment service provider's system. The provider independently verifies the sender's balance and transaction authenticity without requiring multiple computer nodes to process the transaction, thereby maintaining security through trusted verification while dramatically improving processing speed by eliminating network consensus delays
3Reliability
If the system verifies cryptocurrency balance and ownership before transaction, then fraud risk is reduced, but verification time increases
Solution Approach 1:
The system performs balance and ownership verification as a preliminary action before the actual transaction occurs. The payment service provider checks the distributed ledger in advance to confirm the sender's balance and ownership, storing this verification result. When the transaction is initiated, the system relies on this pre-verified information, reducing fraud risk while minimizing the time required at the moment of transaction
Data Source
AI summary
Methods and systems are presented for providing a framework for facilitating time-sensitive cryptocurrency transactions for users. When a request for processing a time-sensitive cryptocurrency transaction using funds from a cryptocurrency wallet is received from a user, a transaction system first verifies whether the cryptocurrency wallet has a balance to cover the cryptocurrency transaction. The transaction system also verifies the ownership of the cryptocurrency wallet based on an asynchronous method. The user generates verification data without any input from the transaction system, and based on a private key associated with the cryptocurrency wallet, a generator function, and a user-generated value. Without knowing the user-generated value, the transaction system verifies the ownership of the cryptocurrency wallet based on the verification data, and processes the transaction for the user.