US11055707B2 — Cryptocurrency infrastructure system
Document text
Research, not advice. Part of the Bitcoin research archive (October 2026). Claims labelled unverified, contested or fringe are reported, not endorsed; statuses of bills and rules are as of the date checked. Government, court and patent records are public domain; the research notes are CC BY 4.0.
US011055707B2
( 12 ) Lingappa
United States Patent ( 10) Patent No .: US 11,055,707 B2
Jul . 6 , 2021
(45 ) Date of Patent :
( 54 ) CRYPTOCURRENCY INFRASTRUCTURE ( 56 ) References Cited
SYSTEM
U.S. PATENT DOCUMENTS
( 71 ) Applicant: Visa International Service 5,696,827 A 12/1997 Brands
Association , San Francisco , CA (US ) 5,983,207 A 11/1999 Turk et al.
5,999,625 A 12/1999 Bellare et al .
( 72 ) Inventor: Phaneendra Ramaseshu Lingappa , 2004/0117303 A1 6/2004 Gamboa
Foster City, CA (US ) 2006/0020641 A1 * 1/2006 Walsh G06Q 10/10
2008/0120129 A1 * 5/2008 Seubert G06Q 10/10
( 73 ) Assignee : Visa International Service 705/35
2013/0198519 A1 * 8/2013 Marien GO6F 21/34
Association , San Francisco , CA (US ) 713/172
Subject to any disclaimer, the term of this 2013/0346302 A1 * 12/2013 Purves G06Q 20/102
( * ) Notice : 705/40
patent is extended or adjusted under 35 2014/0164251 A1 6/2014 Loh
U.S.C. 154 ( b ) by 851 days . ( Continued )
( 21 ) Appl . No .: 14 /749,573 OTHER PUBLICATIONS
(22) Filed : Jun . 24 , 2015 Dialog Search ( Year: 2021 ) . *
( 65 ) Prior Publication Data (Continued )
US 2015/0371224 A1 Dec. 24 , 2015 Primary Examiner - Dante Ravetti
Related U.S. Application Data (74 ) Attorney , Agent, or Firm — Kilpatrick Townsend &
Stockton LLP
( 60 ) Provisional application No. 62/ 016,556 , filed on Jun .
24 , 2014 .
( 57 ) ABSTRACT
(51 ) Int. Ci.
G06Q 20/38 ( 2012.01 ) Embodiments of the present invention are directed to meth
G06Q 20/06 ( 2012.01 ) ods and systems for managing a cryptocurrency payment
G060 20/40 ( 2012.01 ) network comprising one or more issuer nodes and one or
( 52) U.S. CI. more distributor nodes. Issuer nodes may be granted differ
CPC G06Q 20/3829 (2013.01 ) ; G06Q 20/065 ent rights from distributor nodes with respect to the issuance
( 2013.01 ) ; G060 20/3825 ( 2013.01 ) ; G060 and distribution of digital currency within the cryptocur
20/401 (2013.01 ) rency payment network . A management system server com
( 58 ) Field of Classification Search puter may generate unique node verification key pairs for
CPC G06Q 2220/00 ; G06Q 2220/10 ; G06Q each node in the cryptocurrency payment network , where
2220/16 the node verification key pairs may be used to identify and
authenticate issuer nodes and distributor nodes .
USPC 705/16 , 21 , 59 , 71 ; 380/44 , 262 , 278 ,
380/279
See application file for complete search history. 13 Claims , 7 Drawing Sheets
FIRST PAYMENT ENTITY
155A CRYPTOCURRENCY PAYMENT NETWORK 145
FIRST END USER ( E.G. , MANAGEMENT
CONSUMER ) ISSUER NODES 105A - 105N SYSTEM SERVER
CERTIFICATE 110AW COMPUTER
1254 ISSUER 150
LEDGER 115A NODE
105A
FIRST USER COMPUTING
DEVICE
130A
:
SECOND PAYMENT ENTITY
155B
SECOND USER COMMUNICATION
COMPUTING DEVICE NETWORKIS )
1306 116 CERTIFICATE
CERTIFICATE 110B 110M
SECOND END USER (E.G.
MERCHANT ) DISTRIBUTOR DISTRIBUTOR
125B NODE CERTIFICATE NODE
120A 1100 120M
DISTRIBUTOR LEDGER 115M
LEDGER 115B NODE
|
120B
LEDGER 1150
DISTRIBUTOR NODES 1204-120M
US 11,055,707 B2
Page 2
( 56 ) References Cited
U.S. PATENT DOCUMENTS
2014/0226821 A1 * 8/2014 Kurdziel HO4L 9/0836
380/278
2014/0330721 A1 11/2014 Wang
2015/0170112 Al * 6/2015 DeCastro G06Q 20/381
705/39
2015/0332395 A1 * 11/2015 Walker G06Q 20/065
705/69
2019/0220859 A1 * 7/2019 Weight G06Q 20/381
OTHER PUBLICATIONS
IP.com Search ( Year: 2021 ) . *
“ Could a centralized body create a cryptocurrency and keep mining
details secret ? ” Let's Talk Bitcoin.com , or “ LTB ” , Mar. 8 , 2015 , 2
pages .
“ Notice of Finding that Liberty Reserve S.A. is a Financial Insitu
tion of Primary Money Laundering Concern , ” Department of the
Treasury ( “ Liberty Reserve ” ), May 28 , 2013 , 14 pages .
" Virtual Currencies Key Definitions and Potential AML / CFT Risks , ”
FATF Report, Whitepaper, Jun . 2014 , 17 pages .
“ E -gold ,” Wikipedia, last edited on Aug. 2015 , 8 pages .
* cited by examiner
U.S. Patent Jul . 6 , 2021 Sheet 1 of 7 US 11,055,707 B2
100
MANAGEMENT SYESRTVEMR COMPUTER 150
---
1
DISTRIBUTOR L1EDG5EMR
NODE 120M
IN1SO0-DU5EANSR
CERTIFICATE 110M
1
CPNRY1AEPTYOCMW4UREORENR5CTKY DN1ISOT2RID-B0UETOAMSR
ISSUER NODE 105A COMUNICATION S
NETW(
)ORK
115
CERTIFICATE 1 0C
DISTRIBUTOR L1EDG5ECR
NODE 120B
= 17 - IF
FIG
.
1
C1ERTIFI0CATE L1EDG5EAR
C1ERTIFI0CATBE DISTRIBUTOR
NODE 120A L1EDG5EBR
SECND
USER(,.G.ON MERC)HANT
PEFANIYTRMIESTNYT 15 A CONS)UMER125A CFUOMISPRUTESINRTG DEVICE 130A PSEAENYCTMOIENTDYT 15 B SUESCOENRD CDOEMPVUITICNEG 130B
FIRST
END
USER
(
E.G.
, :
125B
U.S. Patent Jul . 6 2, 2021 Sheet 2 of 7 US 11,055,707 B2
MANAGEMENT SYSTEM SERVER COMPUTER
150
PROCESSOR
150a
COMPUTER READABLE MEDIUM
150b
AUTHENTICATION MODULE
150b - 1
KEY GENERATION MODULE
1500-2
DATA OUTPUT MODULE
150b - 3
NODE
PROFILES
DATABASE
150c
FIG . 2
U.S. Patent Jul . 6 , 2021 Sheet 3 of 7 US 11,055,707 B2
300
MANAGEMENT CERTIFICATES CERTIFICATES DISTRIBUTOR
SYSTEM GENERATE 302 SEND TOANDKEYS IASSNUEDR NODES 304
150
DISTRIBUTOR
NODE 120D
NDISTRIBUTOR ODE 120C
CPNR1YAEPTYOCMW4UREONR5CTKY NODE
DISTRIBUTOR 120B
3
.
FIG
NDISTRIBUTOR ODE 120A DISGBIUTRASLE CURINECY TRANSACTOIN PFAIYRMESNTENT312ITY
ISSUER NODE 105A GDEINGEIRTATLE CURENCY CREATE TRANSAOCTIN DI3STRI1BUT0OR
308
SECOND PAYMENT E1N5TI5TBY
PAYMENT
FIRST E1NT5ITAY ACRCEOAUTNET DWISTIRBTUHOR NO306DE
U.S. Patent Jul . 6 , 2021 Sheet 4 of 7 US 11,055,707 B2
400
MANAGEMENT SYSTEM 150
DISTRIBUTOR
NODE 120D
DISTRIBUTORNODE 120C
CPRNY1APETYOCMW4UREONR5CTKY NODE
DISTRIBUTOR 120B
FIG
.
4
DISTRIBUTOR NODE 120A
IS UER NODE 105A
SECOND PAYMENT E1N5TITBY DETERMINE TRANSACTION VALIDITY 406
PAYMENT CREATE TRANSACTOIN PSAEYCMOENDT ENTITY
FIRST E1N5TITAY 402 SEND
TRANSACTION MESSAGE 404
U.S. Patent Jul . 6 2, 2021 Sheet 5 of 7 US 11,055,707 B2
500
DETERMINING THAT A FIRST FINANCIAL INSTITUTION SERVER COMPUTER IS AUTHORIZED TO
GENERATE A DIGITAL CURRENCY
505
GENERATING A FIRST DIGITAL CERTIFICATE FOR THE FIRST FINANCIAL INSTITUTION SERVER
COMPUTER INCLUDING A FIRST KEY INDICATING THAT THE FIRST FINANCIAL INSTITUTION SERVER
COMPUTER IS AUTHORIZED TO GENERATE THE DIGITAL CURRENCY
510
DETERMINING THAT A SECOND FINANCIAL INSTITUTION SERVER COMPUTER IS AUTHORIZED TO
DISTRIBUTE THE DIGITAL CURRENCY
515
GENERATING A SECOND DIGITAL CERTIFICATE FOR THE SECOND FINANCIAL INSTITUTION SERVER
COMPUTER INCLUDING A SECOND KEY INDICATING THAT THE SECOND FINANCIAL INSTITUTION
SERVER COMPUTER IS AUTHORIZED TO DISTRIBUTE THE DIGITAL CURRENCY
520
SENDING , BY THE SERVER COMPUTER , THE FIRST DIGITAL CERTIFICATE TO THE FIRST FINANCIAL
INSTITUTION SERVER COMPUTER AND THE SECOND DIGITAL CERTIFICATE TO THE SECOND
FINANCIAL INSTITUTION SERVER COMPUTER
525
FIG . 5
U.S. Patent Jul . 6 , 2021
2 Sheet 6 of 7 US 11,055,707 B2
600
RECEIVING A REQUEST MESSAGE FROM A FINANCIAL INSTITUTION SERVER COMPUTER TO GENERATE
A DIGITAL CURRENCY , THE REQUEST MESSAGE INCLUDING AN AMOUNT OF THE DIGITAL CURRENCY ,
THE REQUEST MESSAGE ENCRYPTED USING A FIRST KEY OF A KEY PAIR
605
DETERMINING THAT THE FINANCIAL INSTITUTION SERVER COMPUTER IS AN ISSUER NODE
AUTHORIZED TO GENERATE THE DIGITAL CURRENCY USING A SECOND KEY OF THE KEY PAIR
610
AUTHORIZING THE FINANCIAL INSTITUTION SERVER COMPUTER TO GENERATE THE DIGITAL
CURRENCY BY SENDING A RESPONSE MESSAGE TO THE FINANCIAL INSTITUTION SERVER COMPUTER
615
FIG . 6
U.S. Patent Jul . 6 , 2021 Sheet 7 of 7 US 11,055,707 B2
SBYSUTESM 700 EXTERNAL INTERFACE 720
PRINTER 708 FDIXSEDK 718
CENTRAL PROCESOR 706
KEYBOARD 716 .
FIG
7
SMYESMTOERMY 704 SPEORIRATL 714
CONTRI/OLLER
702
DAIDSAPLTAEYR 710
MONITOR 712
US 11,055,707 B2
1 2
CRYPTOCURRENCY INFRASTRUCTURE quantity of “ new ” bitcoins may be issued to that miner as a
SYSTEM reward . Specifically, nodes perform work by repeatedly
trying to solve instances of the mathematical problem
CROSS - REFERENCE TO RELATED through trial and error , with each attempt having an equal
APPLICATIONS 5 but very low chance of being a correct solution . When a
node successfully solves the mathematical problem ( i.e. , the
This application claims the benefit of priority from U.S. network node processes a “ block ” of transactions), the
Provisional Application No. 62 /016,556 , filed Jun . 24 , 2014 , network node may be rewarded by receiving a programmed
titled " CRYPTO - CURRENCY INFRASTRUCTURE SYS- amount of bitcoins to compensate the operators of these
TEM , ” which is incorporated by reference in its entirety for 10 nodes for their computational work and resources used to
all purposes. secure the bitcoin transactions. In addition, when the math
ematical problem is solved, the transaction ( s) linked to the
BACKGROUND mathematical problem are appended to the end of the block
chain and distributed to the other nodes in the system .
The proliferation of mobile devices with Internet capa- 15 More specifically, mining is the calculation of a crypto
bilities ( e.g. , mobile phones, wearable devices ) has made it graphic hash of a block header, which includes among other
increasingly easy for users to conduct electronic commerce things a reference to the previous block ( e.g. , a previous
and online purchases using merchant websites and mobile transaction in the block chain ), the current transaction , and
applications. This has also led to an increased shift away a nonce (i.e. , a 32 - bit field having a random or pseudo
from paper -based monetary schemes (e.g. , the exchange of 20 random
physical or paper currency ) to instead rely upon electronic
value) . If the determined hash value is found to be
less than a current target (which may be inversely propor
systems for monetary exchange . Many electronic payment tional to the difficulty ), the user has successfully “ solved ”
systems have been developed for exchanging money, includ- the problem , a new block may be formed in the block chain
ing the use of electronic wallets and electronic funds transfer with the current transaction, and the miner may be rewarded
( EFT ) . EFT includes a direct debiting/ crediting of a user's 25 a quantity of newly generated bitcoins . If the determined
bank account at the instance of the user from a remote hash value is not less than the current target, a new nonce is
location . generated and tried, and a new hash may be calculated . This
Another type of electronic system for monetary exchange computation may be done millions of times per second by
is commonly referred to as an electronic peer -to -peer pay- each miner until the problem is solved .
ment system or digital currency system . Bitcoin is one 30 Once generated or mined , a bitcoin may be stored in a
example of a digital currency system that utilizes crypto- user's bitcoin “ wallet ” which may be either stored on the
graphic techniques, and thus the digital currency is referred user's user computing device by the bitcoin software or
to as cryptocurrency. Although there are many such cryp- hosted on a third -party website or server computer. The
tocurrencies, Bitcoin is one of the most well -known and thus wallet may show users their available bitcoin balance ,
will be discussed herein , as many other cryptocurrencies 35 previous transaction history, and the collection of bitcoin
share similar features. Payments made using the Bitcoin addresses they may use to send and receive bitcoins with
system are recorded in a ledger (the “ Block Chain " , which other users . If an owner of a bitcoin decides to : ( i ) exchange
is maintained in parallel by many different entities in the a quantity of bitcoins for another form of currency, such as
system) using its own unique monetary unit , which is also for U.S. dollars , and / or ( ii ) use a quantity of bitcoins as a
called a “ bitcoin . ” The Bitcoin system has no central reposi- 40 form of payment for goods or services, the owner of the
tory and no single administrator, and thus is viewed as a bitcoin transfers the bitcoin to a payee by digitally signing
decentralized virtual currency . a hash of the previous transaction ( involving the bitcoin) and
New bitcoins are created as a reward for payment pro- a public key ( also referred to as an “ address ”) of the payee
cessing work performed by computing devices involved in and then adding these to the end of the bitcoin address. With
the Bitcoin system . For example, users may use their per- 45 such information viewable in the bitcoin address , the payee
sonal computing systems to verify and record transactions (and other nodes) can verify the chain of ownership . For
that are to be entered into the ledger. Users may verify example , when a bitcoin belonging to user A is transferred
transactions by solving mathematical problems linked to the to user B , user A's ownership over that bitcoin is relin
transaction . This process is referred to as “ mining ", and both quished by adding user B’s public key address to the bitcoin
individuals and companies engage in this activity to seek 50 coin and signing the result with the private key that is
( optional ) transaction fees and /or newly created bitcoins . associated with user A's address . User B now owns the
When the user solves the mathematical problem associated bitcoin and can transfer it further. In this example , user A is
with the transaction, that transaction is then appended to the prevented from transferring the already spent bitcoin to
end of the Block Chain . Users typically send and receive other users because a ledger of all previous transactions may
bitcoins electronically using wallet software on a personal 55 be collectively maintained by the nodes of the network.
computer, mobile device, via a web application, or using any One drawback of systems such as Bitcoin is that because
other appropriate user computing device. the entire system is based upon trust and is not backed by
In addition to mining , bitcoins can also be obtained in any government, the value of bitcoins can be highly volatile
exchange for fiat currency ( i.e. , currency which derives its and driven by speculation .
value from government regulation or law , such as the U.S. 60 In addition, fraudsters and criminals are able to rely upon
Dollar or British Pound) , products, and / or services . How- the generally anonymous nature of the Bitcoin system to
ever, bitcoins themselves are not linked to any fiat currency avoid detection , and theft of bitcoins can be nearly impos
and derive their value based on a perceived value of the sible to track down and recover. Thus, while a person who
bitcoins . has deposited an amount of an available currency (e.g. , U.S.
In practice , each time a node or “ miner ” ( e.g. , a user 65 dollars ) at a bank may be required to provide their identi
computing device in communication with the network ) in fication to withdraw their deposited funds and /or transfer
the system finds the solution to a mathematical problem , a funds to another person , bitcoins are anonymous and do not
US 11,055,707 B2
3 4
typically require any identification (other than a randomly Another embodiment of invention is directed to a method
generated key address ) of the party currently owning such comprising receiving a request message from a financial
bitcoins . institution server computer to generate a digital currency.
Thus, there is a need for new and enhanced methods of 5 The request message may include an amount of the digital
integrating a management system into a cryptocurrency currency to be generated. The request message may be
payment network to create a digital currency system that has encrypted using a first key of a key pair associated with the
greater efficiency and more security . financial institution server computer. The method further
Embodiments of the present invention address these and comprises determining that the financial institution server
other problems , individually and collectively . 10
computer is an issuer node authorized to generate the digital
currency. The determination may be made using a second
BRIEF SUMMARY key of the key pair associated with the financial institution
server computer. The method further comprises authorizing
Embodiments of the present invention relate to systems the financial institution server computer to generate the
and methods for the efficient management of a cryptocur- 15 digital currency by sending a response message to the
rency payment network . Embodiments utilize a management financial institution server computer.
system server computer to determine and designate issuer Another embodiment of invention is directed to a server
nodes, which have the right to generate and issue digital computer comprising: a processor and a computer readable
currency, and distributor nodes, which have the right to medium coupled to the processor, the computer readable
distribute digital currency but not issue digital currency. 20 medium comprising code , executable by the processor to
Transactions performed through the cryptocurrency pay- implement a method comprising receiving a request mes
ment network using the digital currency can be tracked and sage from a financial institution server computer to generate
maintained in a ledger of transactions maintained by the igital currency. The request message may include an
issuer nodes and the distributor nodes . amount of the digital currency to be generated. The request
One embodiment of the invention is directed to a method 25 message may be encrypted using a first key of a key pair
comprising , determining, by a server computer, that a first associated with the financial institution server computer. The
financial institution server computer is authorized to gener
ate a digital currency. The method further comprises gener method further comprises determining that the financial
ating a first digital certificate for the first financial institution generate theserver
institution computer is an issuer node authorized to
digital currency. The determination may be
server
first keycomputer . Thethatfirstthedigital
indicating certificateinstitution
first financial may include
servera 30 made using a second key of the key pair associated with the
computer is authorized to generate the digital currency. The comprisesinstitution
financial
authorizing
server computer. The method further
the financial institution server com
method further comprises determining that a second finan puter to generate the digital currency by sending a response
cial institution server computer is authorized to distribute the
digital currency. The method further comprises generating a 35 message to the financial institution server computer.
Another embodiment of invention is directed to a method
second digital certificate for the second financial institution comprising receiving a transaction message to transfer an
server computer. The second digital certificate may include
a second key indicating that the second financial institution amount of a digital currency from a first payment entity to
server computer is authorized to distribute the digital cur- a second payment entity associated with the server com
rency to a user computing device . The method further 40 puter. The transaction message may include a first identifier
comprises sending the first digital certificate to the first for the first payment entity, a second identifier for the second
financial institution server computer and the second digital payment entity, the amount of the digital currency, and a
certificate to the second financial institution server com- digital signature . The method further comprises validating
puter. the transfer of the amount of the digital currency using the
Another embodiment of invention is directed to a server 45 digital signature.
computer comprising: a processor and a computer readable Another embodiment of invention is directed to a server
medium coupled to the processor, the computer readable computer comprising: a processor and a computer readable
medium comprising code , executable by the processor to medium coupled to the processor, the computer readable
implement a method comprising determining that a first medium comprising code , executable by the processor to
financial institution server computer is authorized to gener- 50 implement a method comprising receiving a transaction
ate a digital currency . The method further comprises gener- message to transfer an amount of a digital currency from a
ating a first digital certificate for the first financial institution first payment entity to a second payment entity associated
server computer. The first digital certificate may include a with the server computer. The transaction message may
first key indicating that the first financial institution server include a first identifier for the first payment entity, a second
computer is authorized to generate the digital currency. The 55 identifier for the second payment entity, the amount of the
method further comprises determining that a second finan- digital currency, and a digital signature. The method further
cial institution server computer is authorized to distribute the comprises validating the transfer of the amount of the digital
digital currency . The method further comprises generating a currency using the digital signature.
second digital certificate for the second financial institution These and other embodiments of the invention are
server computer. The second digital certificate may include 60 described in further detail below with reference to the
a second key indicating that the second financial institution Drawings and the Detailed Description .
server computer is authorized to distribute the digital cur
rency to a user computing device. The method further BRIEF DESCRIPTION OF THE DRAWINGS
comprises sending the first digital certificate to the first
financial institution server computer and the second digital 65 FIG . 1 shows a block diagram of an exemplary system
certificate to the second financial institution server com- including a cryptocurrency payment network according to
puter. an embodiment of the present invention .
US 11,055,707 B2
5 6
FIG . 2 shows a detailed block diagram for a management amount, and the participants of the transaction ( e.g. , the
system server computer according to an embodiment of the sender and the receiver of the transaction amount). In some
present invention . embodiments, the ledger of transactions may be a block
FIG . 3 shows a sequence diagram of a method of certifi- chain where each new block in the block chain is algorith
cate generation and distribution , digital currency generation , 5 mically determined based on new transactions and previous
and digital currency distribution according to an embodi- blocks in the block chain . In some embodiments, each node
ment of the present invention . within a cryptocurrency payment network may store their
FIG . 4 shows a sequence diagram of a method of trans- own copy of the ledger of transactions. In other embodi
ferring digital currency between two payment entities ments, only some nodes store their own copy of the ledger
according to an embodiment of the present invention . 10 of transactions.
FIG . 5 shows a flowchart of a method for generating and The term “ digital certificate ” may refer to data used as
distributing digital certificates to issuer nodes and distributor part of a verification process. A digital certificate may be
nodes in a urrency payment network according to an used to send information to from one entity to another entity.
embodiment of the present invention . The digital certificate may be used to verify that the entity
FIG . 6 shows a flowchart of a method for receiving and 15 sending a message is authentic. In some embodiments, a
processing a request for issuance of digital currency in a digital certificate may include data indicating a digital
cryptocurrency payment network according to an embodi- certificate version , a serial number, an algorithm identifier, a
ment of the present invention . name of the issuing certificate authority (e.g. , a management
FIG . 7 shows an exemplary block diagram of a computer system) , an expiration date , a copy of the node verification
apparatus according to an embodiment of the present inven- 20 public key, and the digital signature of the issuing certificate
tion . authority so that a recipient (e.g. , the node ) can verify that
the certificate is authentic .
TERMS The term “ digital signature” may refer to an electronic
signature for a message . In some embodiments, the digital
Prior to discussing embodiments of the invention , 25 signature may be used to validate the authenticity of a
descriptions of some terms may be helpful in providing a transaction message sent within a cryptocurrency payment
better understanding of the invention . network . A digital signature may be a unique value gener
The term “ digital currency ” may refer to units of value ated from a message and a private key using an encrypting
that may be used as a form of payment for transactions, algorithm . In some embodiments, a decrypting algorithm
including financial transactions. Digital currency may be 30 using a public key may be used to verify the signature. The
currency that is electronically generated by and stored digital signature may be a numeric value , an alphanumeric
within a user computing device. Digital currency may be value , or any other type of data including a graphical
purchased using conventional forms of currency ( e.g. , fiat representation.
currency ) and generated with a specific value . Typically, the The term “ key ” may refer to a piece of data or information
digital currency may not have a physical form of tender but 35 used for an algorithm . A key may be a unique piece of data
may be accessible through a user computing device ( e.g. , and is typically part of a key pair where a first key (e.g. , a
mobile device) using a software application such as a digital private key) may be used to encrypt a message , while a
wallet or mobile application . second key (e.g. , a public key ) may be used to decrypt the
The term “ cryptocurrency payment network ” may refer to encrypted message . The key may be a numeric or alphanu
one or more server computers that function to operate and 40 meric value and may be generated using an algorithm . A
maintain a cryptocurrency system . The cryptocurrency pay- management system server computer in a cryptocurrency
ment network may function to facilitate the generation / payment network may generate and assign a unique key pair
issuance and distribution of digital currency between the one for each node in the cryptocurrency payment network . In
or more server computers within the cryptocurrency pay- some embodiments, a key may refer to either a node
ment network . The cryptocurrency payment network may 45 verification key pair or a transaction key pair.
also function to enable the performance of transactions A transaction key pair may include a transaction public
between the server computers for the transfer or goods / key and a transaction private key. The transaction key pair
services and / or the transfer of funds . may be used by the nodes and / or payment entities to conduct
The term “ node ” may refer to a computing device within transactions in the cryptocurrency payment network . The
a cryptocurrency system . A node in a cryptocurrency system 50 transaction key pair may be generated by a management
may be associated with and / or operated by a financial system server computer or may be generated by a financial
institution server computer of a financial institution ( e.g. , institution server computer for a payment entity when an
bank ). Each node may have particular rights and restrictions account with the financial institution server computer is
associated with the node . For example , an issuer node may created . The transaction public key of a node may be
have the right to generate and issue digital currency within 55 distributed throughout the cryptocurrency payment network
a cryptocurrency payment network , while a distributor node in order to allow for authentication of payment transaction
may have the right to distribute digital currency , but not messages signed using the private key of the node.
generate or issue digital currency. Other nodes in the cryp- A node verification key pair may include a node verifi
tocurrency payment network , such as merchants and users cation public key and a node verification private key. The
( e.g. , consumers ) , may have the right to transfer digital 60 node verification key pair may be used by the nodes and the
currency . management system to verify that a node is an issuer node
The term “ ledger of transactions” may refer to a compi- or a distributor node. The node verification key pair may be
lation of data from previous transactions. The ledger of generated by a management system server computer in
transactions may be a database or other comparable file response to a request message from a node to be designated
structure that may be configured to store data from all 65 an issuer node or a distributor node in the cryptocurrency
previous transactions performed using a digital currency , payment network . In other embodiments, the node verifica
including the date and time of the transaction, the transaction tion key pair may be generated by a node ( e.g. , a financial
US 11,055,707 B2
7 8
institution server computer ) and sent to the management rights and restrictions, identification data, and verification
system server computer. In some embodiments, a node data. For example, a profile for a financial institution server
verification public key may be functionally similar to a computer may include data indicating the type of node the
transaction public key. However, the node verification pub- financial institution server computer is within a cryptocur
lic key may only be distributed to the node associated with 5 rency payment network . In some embodiments, the profile
the node verification public key. In such embodiments, the may be stored in a database and be linked to an identifier
node verification public key may be encrypted prior to being associated with the entity the profile is related to . An entity
sent to the appropriate node . may have one or more profiles.
The term “ user computing device ” may refer to a com- The term “ financial institution server computer” may refer
puting device that is associated with a user. In some embodi- 10 to a computer associated with a financial institution .
ments, the user computing device can be used to commu- Examples of financial institution server computers may
nicate with another device , computer, or system . It can include an access device , terminal, or a web server computer
include a user computing device that is used to conduct a hosting a financial institution server Internet website . The
transaction. The user computing device may be capable of financial institution server computer may be inany suitable
conducting communications over a network. A user com- 15 form . Additional examples of financial institution server
puting device may be in any suitable form . For example, computers include any device capable of accessing the
suitable user computing devices can be hand - held and Internet, such as a personal computer, cellular or wireless
compact so that it can fit into a user's wallet and / or pocket phones, personal digital assistants (PDAs ) , tablet PCs , and
( e.g. , pocket-sized ). The user computing device can include handheld specialized readers.
a processor, and memory , input devices , and output devices , 20 The term “ database ” may include any hardware , software,
operatively coupled to the processor. Specific examples of firmware, or combination of the preceding for storing and
user computing devices include cellular or mobile phones, facilitating the retrieval of information . In addition , the
tablet computers, desktop computers personal digital assis- database may use any of a variety of data structures ,
tants (PDAs ) , pagers , portable computers , smart cards, and arrangements, and compilations to store and facilitate the
the like . Additional user computing devices may include 25 retrieval of information .
wearable devices , such as smart watches , glasses fitness The term “ payment processing server computer ” may
bands, ankle bracelets, rings, earrings, etc. In some embodi- include a server computer used for payment processing . In
ments, the user computing device may include automobiles some embodiments, the payment processing server com
with remote communication capabilities. puter may be coupled to a database and may include any
The term “ identifier ” may refer to any information that 30 hardware, software, other logic , or combination of the
may be used to identify information . In some embodiments , preceding for servicing the requests from one or more client
the identifier may be a special value generated randomly or computers. The payment processing server computer may
according to a predetermined algorithm , code , or shared comprise one or more computational apparatuses and may
secret. For example, an account identifier may be used to use any of a variety of computing structures, arrangements,
uniquely identify an account. In some embodiments , the 35 and compilations for servicing the requests from one or
identifier may be one or more graphics, a token , a bar code, more client computers. In some embodiments, the payment
a QR code, or any other information that may be used to processing server computer may operate multiple server
uniquely identify an entity. computers. In such embodiments , each server computer may
The term “ transaction ” may include an exchange or be configured to process transaction for a given region or
interaction between two entities. In some embodiments, a 40 handles transactions of a specific type based on transaction
transaction may refer to a transfer of value between two data .
users (e.g. , individuals or entities ). A transaction may The payment processing server computer may include
involve the exchange of monetary funds ( e.g. , digital cur- data processing subsystems, networks, and operations used
rency ), or the exchange of goods or services for monetary to support and deliver authorization services, exception file
funds between two individuals or entities . In other embodi- 45 services, and clearing and settlement services. An exemplary
ments, the transaction may be a purchase transaction involv- payment processing server computer may include
ing an individual or entity purchasing goods or services from VisaNetTM Networks that include VisaNetTM are able to
a merchant or other entity in exchange for monetary funds. process credit card transactions, debit card transactions, and
In other embodiments, the transaction may be a non -finan- other types of commercial transactions. VisaNetTM , in par
cial transaction, such as exchanging of data or information 50 ticular, includes an integrated payments system (Integrated
between two entities, such as the transfer of data or infor- Payments system) which processes authorization requests
mation across a communications channel . Examples of and a Base II system , which performs clearing and settle
non - financial transactions may include transactions for veri- ment services. The payment processing server computer
fying an identity of a server computer and / or rights and may use any suitable wired or wireless network , including
restrictions associated with the server computer. 55 the Internet.
The term “ message ” may include any data or information The payment processing server computer may process
that may be transported from one entity to another entity transaction - related messages ( e.g. , authorization request
( e.g. , one computing device to another computing device ). messages and authorization response messages ) and deter
Messages may be communicated internally between mine the appropriate destination computer (e.g. , issuer com
devices / components within a computer or computing system 60 puter ) for the transaction - related messages . In some embodi
or externally between devices over a communications net- ments, the payment processing server computer may
work . Additionally, messages may be modified , altered , or authorize transactions on behalf of an issuer. The payment
otherwise changed to comprise encrypted or anonymized processing server computer may also handle and / or facilitate
information . the clearing and settlement of financial transactions.
The term “ profile ” may refer to information regarding an 65 The term “ server computer” may include a powerful
entity . In some embodiments , the profile may be a repre- computer or cluster of computers. For example, the server
sentation of information regarding the entity, including computer can be a large mainframe, a minicomputer cluster,
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or a group of servers functioning as a unit. In one example, various embodiments is flexible. Similarly, the use of “ N ”
the server computer may be a database server coupled to a and “ M ” when referring to the issuer nodes 105A - 105N and
Web server . The server computer may be coupled to a distributor nodes 120A - 120M is suggestive to indicate that
database and may include any hardware , software, other there may be any number of these entities in various
logic , or combination of the preceding for servicing the 5 embodiments , and further that there need not be the same
requests from one or more client computers. The server number of issuer nodes 105A - 105N and distributor nodes
computer may comprise one or more computational appa 120A - 120M in various cryptocurrency payment network
ratuses and may use any of a variety of computing struc 145 configurations.
tures, arrangements, and compilations for servicing the The user computing devices 130A - 130B may be in any
requests from one or more client computers . 10 suitable form . For example, suitable user computing devices
may be hand -held and compact so that they can fit into a
DETAILED DESCRIPTION user's pocket . Examples of user computing devices 130A
130B may include any device capable of accessing the
Embodiments of the present invention may be directed at Internet. Specific examples of user computing devices
integrating a management system server computer into a 15 130A - 130B include cellular or wireless phones ( e.g. , smart
cryptocurrency payment network . In such embodiments, the phones ), tablet phones, tablet computers , laptop computers,
management system server computer may manage the rights desktop computers, terminal computers, work stations, per
and restrictions granted to nodes within the cryptocurrency sonal digital assistants ( PDAs ), physical cryptocurrency
payment network . Some nodes in the cryptocurrency pay wallet hardware , pagers , portable computers , smart cards,
ment network may be issuer nodes that are granted the right 20 and the like . In some embodiments of the invention, the user
to issue and generate digital currency, while other nodes may computing devices 130A - 130B and a payment device asso
be distributor nodes that are granted the right to distribute ciated with the user may be a single device ( e.g. , a mobile
digital currency . In some embodiments, the distributor nodes phone ).
are run by financial institutions such as banks, and the issuer The user computing devices 130A - 130B may include a
nodes are run by financial institutions such as central banks 25 processor and a computer readable medium coupled to the
or government agencies . processor, the computer readable medium comprising code ,
In some embodiments, end users ( e.g. , consumers , mer- executable by the processor for performing the functionality
chants) may not be allowed to become nodes in the cryp- described herein . The user computing devices 130A - 130B
tocurrency payment network , and thus cannot be granted the may transmit data through the communication networks 115
right to issue or generate digital currency . 30 to issuer nodes 105A - 105N , distributor nodes 120A - 120M ,
Thus, embodiments of the invention introduce a digital and to the other user computing devices 130A - 130B . For
currency system that provides some benefits of traditional example, the first user computing device 130A may be
fiat currencies together with some benefits of digital curren- communicatively coupled to the second user computing
cies , while reducing the possibilities of theft, hacking, device 130B via the communication networks 115 in order
criminality, and improperly controlled pricing present in 35 to conduct a transaction with a merchant associated with the
current digital currency systems . second user computing device 130B .
In some embodiments, the cryptocurrency payment net
I. Systems work 145 may comprise one or more server computers (not
illustrated ) implementing the issuer nodes 105A - 105N and
FIG . 1 shows a block diagram of an exemplary system 40 the distributor nodes 120A - 120M . In some embodiments,
100 including a cryptocurrency payment network 145 each issuer node 105A - 105N and distributor node 120A
according to an embodiment of the present invention . The 120M may be a server computer associated with a separate
system 100 in FIG . 1 includes a first payment entity 155A financial institution . For example, each issuer node 105A
comprising a first end user 125A with a first user computing 105N may be associated with a central bank, federal reserve ,
device 130A , a second payment entity 155B comprising a 45 or government authority, while each distributor node 120A
second end user 1258 with a second user computing device 120M may be associated with a different commercial bank .
130B , one or more issuer nodes 105A - 105N , one or more In various embodiments, each issuer node and /or distributor
distributor nodes 120A - 120M , and a management system node may be implemented by a separate computing device
server computer 150. In some embodiments , the first end (e.g. , server computer ). However, in some embodiments , a
user 125A and the second end user 1258 may be one of an 50 single server computer may implement multiple issuer nodes
individual user, a business entity, and an organization . Each and / or distributor nodes . The issuer nodes 105A - 105N and
of these systems and computers may be in operative com- the distributor nodes 120A - 120M may include a processor
munication with each other via any suitable communication and a computer readable medium coupled to the processor,
medium ( including the Internet ), using any suitable com- the computer readable medium comprising code , executable
munications protocol . In the embodiment shown in FIG . 1 , 55 by the processor for performing the functionality described
the systems and computers are shown to interact via one or herein .
more communication networks 115 (e.g. , one or more of the In some embodiments , each of the distributor nodes
Internet, private communication networks, and public com 120A- 120M may be implemented by one or more server
munication networks ). computers that maintain user profiles and / or account data
For simplicity of illustration, a certain number of com- 60 (e.g. , financial account data ) for one or more of the end users
ponents are shown in FIG . 1. It is understood , however, that 125A - 125B . For example, in some embodiments, each of
embodiments of the invention may include more than one of the distributor nodes 120A - 120M is hosted by a respective
each component. In addition, some embodiments of the financial institution (e.g. , a bank ), and thus each distributor
invention may include fewer than or greater than all of the node 120A - 120M may have an explicit relationship with one
components shown in FIG . 1. Thus, in FIG . 1 , the inclusion 65 or more of the end users 125A - 125B through a financial
of dotted lines indicates optional features that serve as a account, where the end user may have provided information
reminder that the number of these entities included in to the financial institution (e.g. , name, address, phone num
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ber, demographic information , government identification transaction private key) . In some embodiments, each node
data such as a Social Security Number ( SSN) , etc. ) . can use the transaction private key to generate a digital
As noted above, the cryptocurrency payment network 145 signature ( and thus , a payment message ), and the node's
may be comprised of issuer nodes 105A - 105N and distribu- transaction public key can be made publicly available ( e.g. ,
tor nodes 120A - 120M in communications via the commu- 5 to other nodes in the cryptocurrency payment network 145 )
nications network 115. In some embodiments, each of these to allow other nodes to verify the authenticity of the payment
node may be granted the rights and ability to participate in transaction , and correspondingly record the payment trans
the cryptocurrency payment network 145 by the manage- action in their respective ledgers. In some embodiments, the
ment system server computer 150. In such embodiments, the transaction public key may be a " destination address " iden
management system server computer 150 may be configured 10 tifying a recipient of a digital currency payment. For
to generate and distribute digital certificates, including a example, when a first payment entity 155A wishes to send
node verification public key, to each of the nodes to allow digital currency to a second payment entity 155B , the first
the nodes to function in the cryptocurrency payment net- payment entity 155, generates a digital signature by : ( 1 )
work 145. The node verification public key may be part of creating a payment message identifying some digital cur
a node verification key pair, which may include a node 15 rency held by the first payment entity 155A and also
verification private key. The node verification key pair may identifying the recipient the funds ( e.g. , using a transaction
be an asymmetric key pair such that the node verification public key of the second payment entity 155B ) , ( 2 ) encrypt
public key may be used to encrypt a message sent from a ing the payment message using the transaction private key of
node to the management system server computer 150 , and the first payment entity 155A , ( 3 ) and sending the encrypted
the corresponding node verification private key for that node 20 payment message to the second payment entity 155B and to
may be used by the management system server computer the other nodes in the cryptocurrency payment network 145 .
150 to decrypt the message. The other entities ( e.g. , nodes, payment entities, etc.) in the
?
The node verification key pair may be generated by a cryptocurrency payment network 145 may then use the
management system server computer 150 in response to a transaction public key of the first payment entity 155A to
request message from a node to be designated an issuer node 25 verify that the amount of digital currency is valid and has
or a distributor node in the cryptocurrency payment network been transferred to the second payment entity 155B by the
145. In other embodiments, the node verification key pair first payment entity 155A . Once the transaction is verified ,
may be generated by a node ( e.g. , a financial institution the transaction may be published into ledgers ( e.g. , ledger
server computer ) and sent to the management system server 115A - 115M) maintained by the one or more nodes in the
computer 150. In some embodiments, node verification 30 cryptocurrency payment network 145 .
public keys may be sent to the issuer nodes 105A - 105N and In some embodiments, an issuer node 105A may be
distributor nodes 120A - 120M by encrypting each of the granted a digital certificate ( e.g., 110A) by the management
node verification public key such that only the associated system server computer 150. The issuer node 105A can use
node can decrypt their node verification public key. this digital certificate to initiate the process of generating
In some embodiments, each of the issuer nodes 105A- 35 digital currency. There are a variety of ways to generate
105N and each of the distributor nodes 120A - 120M may additional digital currency, including but not limited to the
maintain a ledger 115A - 115M of the payment transactions issuer node 105A creating a new payment transaction to
made in the cryptocurrency payment network 145. In some itself, and creating new payment transactions to any of the
embodiments, the ledgers 115A - 115M may include a list of distributor nodes 120A - 120M , etc. In some embodiments,
transactions with each entry including a sender address, a 40 these payment transactions reference completely new cur
receiver address, and an amount of digital currency for each rency that has not previously existed until that payment
transaction. In some embodiments, the ledger may include a transaction — the issuer nodes 105 are able to “ generate ” or
record of all transactions ever performed using the digital invent new digital currency simply by the authority granted
currency . to it by the management system server computer 150 .
In some embodiments , a payment transaction may only be 45 Embodiments of the invention allow for the use of many
considered “ official” and successfully processed when the different types of digital certificates and cryptographic algo
payment transaction is recorded in (all or one or more of) the rithms known to those of skill in the art, including but not
ledgers 115A - 115M . Thus, in some embodiments, all pay- limited to the use of Elliptic Curve Digital Signature Algo
ment transaction messages need to be transmitted to the rithm ( ECDSA) , the Secure Hash Algorithm ( SHA) family
nodes maintaining the ledgers 115A - 115M . In some embodi- 50 of cryptographic hash functions ( e.g. , SHA - 1 family, SHA - 2
ments, a payment entity (e.g. , 155A) transmits a payment family, SHA - 3 family, etc.), the Scrypt algorithm , etc.
transaction message to each of the nodes maintaining a In some embodiments , a distributor node 120A may also
ledger, but in other embodiments the payment entity 155A be granted a digital certificate ( e.g. , 110B ) by the manage
may transit the payment transaction message to just one of ment system server computer 150. The distributor node
these nodes (which in turn forwards it to the other ledger- 55 120A can use this digital certificate, after receiving an
maintaining nodes ) or to another computing device specially amount of digital currency from an issuer node 105A , to
configured to provide payment transaction messages to the distribute an amount of the of the digital currency to one of
ledger -maintaining nodes . In some embodiments, only a the payment entities ( e.g. , 155A , 155B ) or to another dis
subset of the nodes may maintain a ledger ( e.g. , only tributor node (e.g. , 120B - 120M ) . For example , the distribu
distributor node 1208 ) or entirely different entities altogether 60 tor node 120A can create a new payment transaction to the
may maintain the ledger. first payment entity 155A by generating a digital signature
The nodes and payment entities within the cryptocurrency by : ( 1 ) creating a payment message identifying some of the
payment network 145 may use a “ digital signature " for received digital currency held by the distributor node 120A
performing transactions ( e.g. , transferring digital currency ), and also identifying the recipient the funds ( e.g. , using a
which is based upon the use of digital certificate. A digital 65 transaction public key or destination address of the first
certificate , in embodiments of the invention , may utilize a payment entity 155A) , (2 ) encrypting the payment message
transaction key pair ( e.g. , a transaction public key and a using the transaction private key of the distributor node
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13 14
120A , ( 3 ) and sending the encrypted payment message to the The processor 150a and the data output module 1506-3
first payment entity 155A and to the other nodes in the may be configured to generate and send messages to the
cryptocurrency payment network 145. Other entities ( e.g. , issuer nodes 105 A - 105N and to the distributor nodes 120A
nodes, payment entities, etc.) in the cryptocurrency payment 120M in the cryptocurrency payment network 145. The data
network 145 may then use the transaction public key of the 5 output module 1505-3 may generate and send response
first payment entity 155A to verify that the amount digital messages to the nodes in response to received request
currency is valid and has been transferred to the second messages to generate node verification key pairs and /or
payment entity 155B by the distributor node 120A . Once the request messages indicating that a node is requesting to issue
transaction is verified , the transaction may be published into 10 or generate an amount of digital currency . In some embodi
ledgers (e.g. , ledger 115A - 115M) maintained by the one or ments, the response message generated and sent by the data
more nodes in the cryptocurrency payment network 145 . output module 150b - 3 may include a first key of a key pair
FIG . 2 shows a detailed block diagram for a management (e.g. , a node verification public key) used to identify the
system server computer 150 according to an embodiment of node as an issuer node or a distributor node . In other
the present invention . In some embodiments, the manage- 15 embodiments, the response message generated and sent by
ment system server computer 150 may be associated or the data output module 150b - 3 may include an indication as
operated by a payment processing system . The management to whether the node that sent the request message is an issuer
system server computer 150 may be a single server com- node and authorized to issue and generate the digital cur
puter or network of computers. The management system rency .
server computer 150 may include a processor 150a and a 20 In some embodiments, the management system server
computer readable medium 150b coupled to the processor computer 150 may be coupled to one or more databases and
150a , the computer readable medium 150b comprising code , may include any hardware, software, other logic , or com
executable by the processor 150a for performing the func- bination of the preceding for servicing the requests from one
tionality described herein . or more client computers. For example, the management
The computer readable medium 150b may comprise code 25 system server computer 150 may be coupled to a node
for a plurality of modules , including an authentication profiles database 150c . The node profiles database 150c may
module 150b - 1 , a key generator module 1506-2 , and a data store a profile for each node within the cryptocurrency
output module 150b-3 . payment network 145. The profile for each node may
The processor 150a and the authentication module 150b - 1 include the unique second key of the key pair (e.g. , a node
may be configured to perform authentication processes for 30 verification private key) associated with the mode and
financial institution server computers . The authentication associated with the first key of the key pair sent to the node .
processes may include determining whether a request mes- The profile may also include information regarding the node
sage received from a financial institution server computer is and the rights and restrictions associated with the node ( e.g. ,
from a financial institution that should be granted the rights whether the node is an issuer node or a distributor node ), a
of an issuer node or a distributor node. This may be 35 name of the financial institution associated with the node,
determined based on a bank identification number ( BIN) or and other identifying information ( e.g. , a bank identification
other identifier indicating whether the financial institution number ).
associated with the financial institution server computer is a The management system server computer 150 may com
central bank or a commercial bank . In some embodiments , prise one or more computational apparatuses and may use
the authentication process may also include authenticating a 40 any of a variety of computing structures, arrangements , and
request message from a node to determine whether the node compilations for servicing the requests from one or more
is an issuer node or a distributor node . In such embodiments , client computers . In some embodiments, the management
the processor 150a and the authentication module 1506-1 system server computer 150 may operate multiple server
may evaluate a received message encrypted using a first key computers.
of a key pair ( e.g. , a node verification public key ) by 45 As noted previously, each payment entity ( e.g., first
decrypting the message using a stored second key of the key payment entity 155A) may be comprised of an end user
pair (e.g. , a node verification private key ). (e.g. , first end user 125A) with a user computing device
The processor 150a and the key generator module 1506-2 (e.g. , first user computing device 130A) . In some embodi
in the management system server computer 150 may be ments, the first user computing device 130A may store a
configured to generate a unique node verification key pair 50 digital wallet application that may be used to store digital
for each of the issuer nodes 105A - 105N and distributor currency and to access the cryptocurrency payment network
nodes 120A - 120M . For example, a first key of the key pair 145 in order to perform transactions using the digital cur
may (e.g. , a node verification public key) be sent to a node, rency .
and a second key of the key pair ( e.g. , a node verification
private key ) may be stored in a profile for the node in a node 55 II . Methods
profiles database 150c at the management system server
computer 150. The key pair may be used to identify the node FIG . 3 shows a sequence diagram 300 of a method of
as being either an issuer node or a distributor node such that certificate generation and distribution , digital currency gen
when the node makes a request to generate or issue digital eration , and digital currency distribution according to an
currency , the management system server computer 150 may 60 embodiment of the present invention . Additional methods
determine whether the node is an issuer node that is autho- and processes may be included within these methods and
rized to generate and issue digital currency , or whether the may be recognized by one of ordinary skill in the art, in light
node is a distributor node that is not authorized to generate of the description below . Further, in some embodiments of
or issue digital currency. In some embodiments , the node the present invention , the described methods may be com
verification key pair may be an asymmetric key pair. How- 65 bined , mixed, and matched , as one of ordinary skill would
ever, in other embodiments, the node verification key pair recognize. In addition , although a single issuer node 105A
may be generated using any other appropriate algorithms. and four distributor nodes 120A - 120D are depicted in FIG .
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15 16
3 , in other embodiments there may be a fewer number or a In some embodiments, the node verification key pair may
greater number of such components . be akin to a public and private key pair, with the first key
In step 302 , the management system server computer 150 being equivalent to a public key. However, in some embodi
generates digital certificates for an issuer node 105A and ments, the first key may differ from a typical public key in
distributor nodes 120A - 120D . Each of the issuer node 105A 5 that the first key may not be publicly disclosed or broadcast
and the distributor nodes 120A - 120D may be associated or to any other entity or computer other than the node associ
managed by a different financial institution server computer. ated with the node verification key pair. In such embodi
In some embodiments , the management system server com- ments, the first key may be encrypted prior to being sent to
puter 150 may receive a request from one of the financial the first financial institution server computer via the com
institution server computers requesting that the requesting 10 munications network 115 to ensure that if the first key is
financial institution server computer be designated as a node intercepted , it cannot be used unless the interceptor has the
in the cryptocurrency payment network 145. In such appropriate decryption key. The first key is used by the first
embodiments, the management system server computer 150 financial institution server computer to verify to the man
may determine the type of financial institution associated agement system server computer 150 that the first financial
with the financial institution server computer. For example, 15 institution server computer is an issuer node and thus has the
the financial institution may be a central bank , a reserve right to issue and generate digital currency . In some embodi
bank or government agency, such as the European Central ments, there may be a plurality of financial institution server
Bank of the Federal Reserve of the United States . On the computers that may operate as issuer nodes in the crypto
other hand , the financial institution may be a commercial currency payment network 145. In such embodiments, the
bank ( e.g. , Wells Fargo , Citibank ). 20 process described above may be repeated for each such
In order to determine whether to generate a digital cer- issuer node.
tificate designating the requesting financial institution server A similar process as described above may be performed
ute as an issuer node or a distributor node , the for a second financial institution server computer ( e.g. ,
management system server computer 150 may first deter- associated with node 120A) that is a commercial bank . In
mine the rights and restrictions associated with each finan- 25 such a situation , the management system server computer
cial institution based on the type of financial institution . 150 may generate a second digital certificate and a second
Where the financial institution is a central bank or reserve node verification key pair, with the second node verification
bank , the financial institution server computer associated key pair used to designate and indicate that the second
with the financial institution may be designated as an issuer financial institution server computer is a distributor node.
node in the cryptocurrency payment network 145 , with the 30 The process may be repeated for each of a plurality of
rights to issue and generate digital currency. Where the financial institution server computers (e.g. , nodes 120B
financial institution is a commercial bank, the financial 120D ) requesting to be nodes in the cryptocurrency payment
institution server computer associated with the financial network 145 .
institution may be designated as a distributor node in the In step 304 , the management system server computer 150
cryptocurrency payment network 145 , with the rights to 35 sends a generated digital certificate to the issuer node 105A .
distribute digital currency but not to issue or generate digital In some embodiments, the management system server com
currency . puter 150 may send the digital certificate including the first
In some embodiments, only financial institutions can act key of the first node verification key pair to the issuer node
as nodes within the cryptocurrency payment network 145. In 105A via a communications network 115. In other embodi
such embodiments, payment entities (e.g. , users/ consumers 40 ments, the management system server computer 150 may
and merchants ) may not be granted any node rights by the send the digital certificate including the first key via any
management system server computer 150 and thus may not other appropriate communications means or by physically
be designated as either issuer nodes or distributor nodes. transmitting a computer readable medium to the issuer node
Once the management system server computer 150 has 105A .
determined the type of node that the requesting financial 45 The management system server computer 150 may also
institution server computer may be designated as , the man- send unique digital certificates generated by the manage
agement system server computer 150 may generate a unique ment system server computer 150 to each of the distributor
digital certificate and a node verification key pair for the nodes 120A - 120D . Once the management system server
financial institution server computer. In some embodiments, computer 150 has determined that the financial institution
the first key and the second key ( e.g. , the node verification 50 server computers associated with nodes 120A - 120D are
public and the node verification private key, respectively ) distributor nodes , the management system server computer
may be generated using an asymmetric key pair algorithm . 150 may send a unique digital certificate including a unique
However, the first key and the second key may also be node verification public key to each of nodes 120A - 120D .
generated using other means , as one of ordinary skill in the The management system server computer 150 may send the
art would understand . In some embodiments , the keys of the 55 digital certificates including the node verification public
node verification key pair may be a numeric or alphanumeric keys via a communications network 115 or any other appro
value . priate communications means .
For example, given a first financial institution server Once the issuer node 105A and the distributor nodes
computer being a central bank, the management system 120A - 120D have been established , the cryptocurrency pay
server computer 150 may generate a first digital certificate 60 ment network 145 may be configured for operation. In some
and a first node verification key pair. A first key of the first embodiments , additional nodes may be added or removed
node verification key pair (e.g. , the node verification public from the cryptocurrency payment network 145 at any time ,
key ) may be associated with the first digital certificate , and and any of these above - described steps may again be per
a second key of the first node verification key pair (e.g. , the formed by the management system server computer 150 .
node verification private key or first stored key ) may be 65 In step 306 , a first payment entity 155A creates an account
associated with a profile of the first financial institution with a distributor node 120A . In some embodiments, the
server computer stored in a node profiles database 150c. account creation process may include the first payment
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17 18
entity 155A providing the distributor node 120A with iden- 150 may not add the digital currency to the log . Even where
tifying information of the first end user 125A associated with the node may try to issue digital currency, the fact that it is
the first payment entity 155A , including a first name, a last not listed in the log distributed to the cryptocurrency pay
name, a government - issued identification number such as a ment network 145 may act as an indication to the nodes in
driver's license number, passport number, or social security 5 the cryptocurrency payment network 145 that this digital
number, a date of birth , a residential and / or business address , currency should not be trusted .
a phone number, an account username, an account password, In some embodiments, the management system server
an email address, etc. computer 150 may revoke the digital certificate issued to a
In step 308 , the issuer node 105A may perform the steps node and identifying information for the node (e.g. , a bank
to generate and issue digital currency. In some embodi- 10 identification number or other identifier) may be placed on
ments , the financial institution server computer associated a publicly accessible or distributed revocation list . For
with the issuer node 105A may generate a request message example , if an issuer node is issuing too much digital
for generating and issuing digital currency. In some embodi- currency or issued digital currency when it was not autho
ments, this process may occur algorithmically ( e.g. , accord- rized by the management system server computer 150 , the
ing to a schedule, according to market conditions, according 15 user may be placed on revocation list . In other embodiments,
to a value of an associated fiat currency ) or at the request of the management system server computer 150 may allow the
a user controlling the issuer node 105A . In some embodi- digital certificate to expire and not provide a renewal digital
ments , the request message may include an amount of the certificate. Thus, when a payment transaction message
digital currency the issuer node 105A wants to generate and includes digital currency that was previously issued by a
a first key (e.g. , a node verification public key) of a node 20 node that is currently not an authorized issuer node, other
verification key pair associated with the issuer node 105A . nodes in the cryptocurrency payment network 145 may not
The issuer node 105A may then send the request message to consider the digital currency as trustworthy.
the management system server computer 150 via the com- Assuming the issuer node 105A has been authorized to
munications network 115 . issue the digital currency, when the issuer node 105A
After receiving the request message from the issuer node 25 receives the response message from the management system
105A , the management system server computer 150 may server computer 150 indicating that the issuer node 105A is
determine whether the issuer node 105A is authorized to authorized to generate and issue digital currency , the issuer
generate and issue digital currency. In some embodiments , node 105A may then generate the digital currency . In some
the management system server computer 150 may retrieve a embodiments, the issuer node 105A may generate and issue
node profile associated with the issuer node 105A from the 30 digital currency by establishing an amount of digital cur
node profiles database 150c using a bank identification rency to create and a currency conversion rate between a unit
number or other identifying information . In some embodi- of the digital currency and a fiat currency (e.g. , the U.S.
ments , the management system server computer 150 may Dollar, the British Pound ). For example, one unit of the
retrieve a second key (e.g. , a node verification private key ) digital currency may be the equivalent to one U.S. Dollar.
of the node verification key pair from the retrieved profile 35 The issuer node 105A may generate the digital currency
for the issuer node 105A . The processor and an authentica- in a variety of ways , including but not limited to sending the
tion module 150b - 1 may determine from the received first amount of digital currency to itself as part of a payment
key and the retrieved second key whether the request transaction and advertising the payment transaction through
message was received from an authorized issuer node 105A . out the cryptocurrency payment network 145. For example,
In some embodiments, the request message may be 40 the issuer node 105A may generate a first payment transac
encrypted by the node verification public key prior to being tion message with the source and destination address of the
sent by the issuer node 105A . The determination as to first payment transaction message being the address of the
whether the request message was made by an authorized issuer node 105A . The first payment transaction message
issuer node may be made by using a second key (e.g. , a node may include an amount of digital currency ( e.g. , 100 units)
verification private key) stored at management system server 45 and a digital signature. In some embodiments, the digital
computer 150 to decrypt the encrypted request message . In signature may be generated using a mathematical algorithm .
other embodiments, an algorithm may be used to determine The digital signature may be created by using a transaction
whether the first key matches the second key. Once the private key associated with the sender ( e.g. , issuer node
management system server computer 150 has determined 105A) and the first payment transaction message . In such a
that the request message from the issuer node 105A is valid 50 scenario, a transaction public key associated with the sender
and authenticated ( e.g. , was received from an authenticated (e.g. , issuer node 105A) may then be used to verify the
issuer node), the management system server computer 150 digital signature to ensure that the payment transaction is
may generate and send a response message to the issuer node authentic and was an authorized transaction .
105A indicating such . The issuer node 105A may also send the first payment
In some embodiments, after the management system 55 transaction message to the other nodes (e.g. , 120A - 120D ) in
server computer 150 has determined that the issuer node the cryptocurrency payment network 145 to indicate that the
105A is authorized to issue the digital currency, the man- digital currency , including the amount of digital currency ,
agement system server computer 150 may update a log of has been generated. The other nodes in the cryptocurrency
valid digital currencies that are operating within the cryp- payment network 145 can use the transaction public key of
tocurrency payment network 145. In such embodiments, the 60 the issuer node 105A to verify the digital signature of the
log may be periodically distributed to the nodes in the first payment transaction message . When the digital signa
cryptocurrency payment network 145 to indicate to the ture is verified , the payment transaction may be considered
nodes the digital currencies that are authorized and can be authentic and may be added to the ledgers of the other nodes.
trusted . In such embodiments, where the management sys- In step 310 , subsequent to generating the digital currency,
tem server computer 150 determines that the a request is 65 the issuer node 105A may create a payment transaction to
received by a unauthorized node (e.g. , a distributor node or transfer an amount of the digital currency to one or more
another entity ), the management system server computer distributor nodes (e.g. , 120A - 120D ) . For example, assuming
US 11,055,707 B2
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the issuer node 105A previously generated 100 units of the The other nodes (e.g. , issuer node 105A and distributor
digital currency, the issuer node 105A may want to transfer nodes 120B - 120D ) may also receive the third transaction
50 units of the digital currency to distributor node A 120A . message and may verify the transaction between the dis
In order to distribute the 50 units of the digital currency to tributor node 120A and the first payment entity 155A , and
distributor node A120A , the issuer node 105A may generate 5 when verified , update their respective ledgers of transaction
a second payment transaction message including the address with a record containing the transaction details for the
of the issuer node 105A , the address of distributor node A transaction between the distributor node 120A and the first
120A , the amount of the digital currency (e.g. , 50 units ) , and payment entity 155A . This results in all of the nodes in the
the digital signature. As noted above, the digital signature cryptocurrency payment network 145 recognizing that the
may be generated using a mathematical algorithm using the 10 25 units of digital currency are now “ owned ” by the first
second payment transaction message and the transaction payment entity 155A . Once the transaction has been vali
private key of the issuer node 105A . dated by the nodes in the cryptocurrency payment network
In addition, the second payment transaction message may 145 , the digital currency balance of the first payment entity
also reference the previous transaction processed in the first 155A may be increased by the 25 units of digital currency
payment transaction message described above using a trans- 15 transferred to the first payment entity 155A .
action number of the transaction . The other nodes ( e.g. , In some embodiments, prior to generating the second
120B - 120D ) in the cryptocurrency payment network 145 payment transaction message , the distributor node 120A
may then check the transaction number to verify that the may generate and send a request message to the manage
issuer node 105A received at least 50 units of digital ment system server computer 150. The request message
currency through the previous transaction . In some embodi- 20 from the distributor node 120A may include an amount of
ments , the second payment transaction message may refer- the digital currency the distributor node 120A wants to
ence one or a plurality of previous transactions with values distribute and a first key of a node verification key pair
totaling at least the amount being transferred using the associated with the distributor node 120A ( unique from the
second payment transaction message . For example , transac- node verification key pair associated with the issuer node
tion # 23db2a45 may be for 20 units of digital currency from 25 105A described previously ). The distributor node 120A may
payment entity C to the issuer node 105A , transaction send the request message to the management system server
# 5490eadc may be for 25 units of digital currency from the computer 150 via the communications network 115. In such
issuer node 105A to the issuer node 105A (e.g. , indicating embodiments, the management system server computer 150
newly created digital currency ), and transaction # 432809c9 may determine whether the distributor node 120A is autho
may be for 5 units of digital currency from payment entity 30 rized to distribute digital currency. In some embodiments ,
D to the issuer node 105A . These transactions represent the management system server computer 150 may retrieve a
funding sources for the current transaction being processed . node profile associated with the distributor node 120A from
These transactions are merely exemplary and any combina- the node profiles database 150c . In some embodiments, the
tion of previous transactions may be used as funding sources management system server computer 150 may retrieve a
for the transaction. The other nodes may then verify that 35 second key of the node verification key pair associated with
these previous transaction total at least 50 units of digital the distributor node 120A from the retrieved node profile for
currency to verify that the sender (e.g. , the issuer node the distributor node 120A . The processor and an authenti
105A) has at least 50 units of digital currency to send. In cation module 150b - 1 may determine from the received first
some embodiments, in order to perform and more secure key (e.g. , a node verification public key) and the retrieved
transaction , the other nodes may use the data from the 40 second key (e.g. , a node verification private key) whether the
previous transactions to trace the digital currency back to the request message was received from an authorized distributor
issuer node that issued the digital currency . node 120A . In some embodiments, the request message may
In some embodiments, the other nodes may also verify be encrypted by the node verification public key prior to
that the 50 units of digital currency represented by the three being sent by the distributor node 120A . The determination
previous transactions have not been previously transacted . 45 as to whether the request message was made by an autho
This is done in order to prevent double spending of the same rized distributor node may be made by using a second key
digital currency. (e.g. , a node verification private key ) stored at management
Once the transaction has been validated by the other system server computer 150 to decrypt the encrypted request
nodes , the other nodes may then record the transaction in message . Once the management system server computer 150
their ledgers, by inputting an entry for the transaction 50 has determined that the request message from the distributor
including the sender address, the receiver address, and the node 120A is valid and authenticated , the management
amount of digital currency paid to the receiver in the system server computer 150 may generate and send a
transaction . response message to the distributor node 120A indicating
In step 312 , the distributor node 120A may then distribute such .
digital currency in a transaction to the first payment entity 55 When the distributor node 120A receives the response
155A . Following the above , the distributor node 120A may message from the management system server computer 150
generate a third payment transaction message to distribute indicating that the distributor node 120A is authorized to
digital currency (e.g. , 25 units) to the first payment entity distribute digital currency, the distributor node 120A may
155A . The distributor node 120A may generate the third then generate the second payment transaction message as
payment transaction message including the address of the 60 described above .
distributor node 120A , the address of the first payment entity FIG . 4 shows a sequence diagram 400 of a method of
155A (e.g. , an address associated with the first user com- transferring digital currency between two payment entities
puting device 130A) , the amount of the digital currency according to an embodiment of the present invention . Addi
( e.g. , 25 units ), and the digital signature. As noted above, the tional methods and processes may be included within these
digital signature may be generated using a mathematical 65 methods and may be recognized by one of ordinary skill in
algorithm using the third payment transaction message and the art, in light of the description below. Further, in some
the transaction private key of the distributor node 120A . embodiments of the present invention , the described meth
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ods may be combined , mixed, and matched , as one of include additional information related to the transaction ,
ordinary skill would recognize . In addition , although a including transaction date and time , and a transaction iden
single issuer node 105A and four distributor nodes 120A- tifier.
120D are depicted in FIG . 3 , in other embodiments there In some embodiments, payment transactions may be
may be a fewer number or a greater number of such 5 made that split , or sub - divide , units of digital currency into
components . sub - units. For example , a payment transaction from the first
In step 402 , the first payment entity 155A creates a payment entity 155A to a second payment entity 155B for
payment transaction message to send an amount of digital 7 -units of digital currency may be made using a 10 - unit
currency to the second payment entity 155B . For example, digital currency “ coin” ( e.g. , a previous transaction) of the
the first payment entity 155A may want to send 10 units of 10 first payment entity 155A . Thus , the first payment entity
digital currency to the second payment entity 155B . The first 155A may generate a payment transaction message with the
payment entity 155A may generate the payment transaction 10 - unit coin as the source of the funds ( the “ input ”) and two
message including the address of the first payment entity digital currency destinations — 7 - units to the receiver
155A (e.g. ,a first identifier of the first payment entity 155A) , address ( e.g. , the transaction public key ) of the second
the address of the second payment entity 155B (e.g. , an 15 payment entity 155B , and 3 -units back to the address of the
address associated with the second user computing device first payment entity 155A . Similarly, a payment transaction
130B , a transaction public key of the second payment entity for 7.5 units may be made using an 8 -unit “ coin , ” in which
155B ) ( e.g. , a second identifier of the second payment entity 7.5 units will be directed to the recipient and 0.5 units will
155B ) , the amount of the digital currency ( e.g. , 10 units ), be directed back to the sender. Accordingly, some embodi
and the digital signature . The digital signature may be a 20 ments of the invention are configured to utilize / enforce a
value ( e.g. , a numeric or alphanumeric value ) generated minimal unit size_thus, for example, a smallest amount of
using a mathematical algorithm or function using the pay- digital currency that can exist can be defined as 0.01 units.
ment transaction message and the transaction private key of In some of these embodiments, if a payment transaction
the first payment entity 155A . includes a split into a smaller amount of units than allowed
In step 404 , the first payment entity 155A sends the 25 (e.g. , a split into 0.005 units when the smallest split size is
payment transaction message to the second payment entity 0.01 units ), the other nodes that maintain ledgers may refuse
155B . The first payment entity 155A may send the payment to enter the transaction into their respective ledgers as the
transaction message to the second payment entity 155B via transaction does not follow the rules established for the
a communications network 115 . digital currency
The first payment entity 155A may also send the payment 30 In some embodiments where the value of the digital
transaction message to the nodes ( e.g. , 105A , 120A - 120D ) currency is explicitly tied to the value of a fiat currency ( e.g. ,
in the cryptocurrency payment network 145 via the com- setting the value of a unit of digital currency as always being
munications network 115. The payment transaction message the same as a dollar), the cryptocurrency payment network
may be sent to the nodes to indicate that the first payment 145 may be configured to utilize a same minimal split size
entity 155A is sending 10 units of digital currency to the 35 as used in the fiat currency (e.g. , $ 0.01 for U.S. Dollars, or
second payment entity 155B , as well as to allow the nodes 0.005 Tunisian Dinar, etc. ) . Thus, the ledger -maintaining
in the cryptocurrency payment network 145 to verify and nodes (e.g. , the set of distributor nodes 120A - 120D and the
process the transaction . set of issuer nodes 105A) , may disapprove or reject any
In step 406 , the issuer node 105A and the distributor payment transaction submitted for entry into the ledger ( e.g. ,
nodes 120A - 120D determine the validity of the transaction 40 115B ) that includes an output amount having a smaller unit
in the payment transaction message . The nodes in the of currency than is configured as allowable .
cryptocurrency payment network 145 can use the transaction FIG . 5 shows a flowchart of a method 500 for generating
public key of the first payment entity 155A to verify the and distributing digital certificates to issuer nodes 105A and
digital signature of the payment transaction message . When distributor nodes 120A - 120M in a cryptocurrency payment
the digital signature is verified, the nodes may also deter- 45 network 145 according to an embodiment of the present
mine whether the amount of digital currency in the trans- invention .
action is properly owned by the first payment entity 155A In step 505 , a server computer 150 in a management
and can be transferred by the first payment entity 155A . The system determines that a first financial institution server
nodes may determine whether the amount of digitalcurrency computer ( e.g. , issuer node 105A) is authorized to generate
is owned by the first payment entity 155A by evaluating 50 a digital currency . As described in step 302 above , in some
previous transactions associated with the digital currency embodiments, the server computer 150 may receive a
that are included in the payment transaction message . If the request from the first financial institution server computer
previous transaction data for the digital currency is incom- requesting that the first financial institution server computer
plete or indicates that some or all of the digital currency is be designated as a node in the cryptocurrency payment
not owned by the first payment entity 155A , the transaction 55 network 145. In such embodiments, the server computer 150
may be rejected. may determine the type of financial institution associated
Once the transaction has been verified by the one or more with the first financial institution server computer. For
distributor nodes ( 120A - 120M ) and the one or more issuer example , the financial institution associated with the first
nodes ( 105A - 105N) in the cryptocurrency payment network financial institution server computer may be a central bank ,
145 , the ledger of transactions associated with each of the 60 a reserve bank or government agency, such as the European
nodes may be updated with a record of the transaction Central Bank of the Federal Reserve of the United States . On
between the first payment entity 155A and the second the other hand, the financial institution may be a commercial
payment entity 155B . In such embodiments , an entry in the bank ( e.g. , Wells Fargo , Citibank ).
ledger may include the address of the first payment entity The server computer 150 may determine whether the first
155A , the address of the second payment entity 155B , and 65 financial institution server computer is authorized to gener
the amount of the digital currency sent to the second ate the digital currency based on determining a first identifier
payment entity 155B . In some embodiments, the entry may associated with a first financial institution ( e.g. , bank iden
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23 24
tification number ). The first identifier may be included in the institution server computer. The server computer 150 may
request from the first financial institution server computer, second the first digital certificate and the second digital
and may provide an indication of the financial institution of certificate via a communications network 115 , or via any
the first financial institution . Where the financial institution other appropriate communications means . In some embodi
is a central bank or reserve bank, the financial institution 5 ments, a first non - transitory computer readable medium
server computer associated with the financial institution may containing the first digital certificate may be physically
be designated as an issuer node in the cryptocurrency provided to the first financial institution server computer,
payment network 145 , with the rights to issue and generate and a second non - transitory computer readable medium
digital currency. containing the second digital certificate may be physically
In step 510 , the server computer 150 generates a first 10 provided to the second financial institution server computer
digital certificate for the first financial institution server FIG . 6 shows a flowchart of a method 600 for receiving
computer. In some embodiments, the first digital certificate and processing a request for issuance of digital currency in
may include a first key ( e.g. , a node verification public key ) a cryptocurrency payment network 145 according to an
that may be used to authenticate the first financial institution embodiment of the present invention .
server computer as being authorized to generate and issue 15 In step 605 , a server computer 150 receives a request
the digital currency message from a financial institution server computer ( e.g. ,
The server computer 150 may also generate a first node issuer node 105A) to generate a digital currency . In some
profile ( e.g. , a first profile) for the first financial institution embodiments, the request message may include an amount
server computer in a node profiles database 150c . The server of the digital currency the financial institution server com
computer 150 may store a key correlated with the first key 20 puter wants to generate. The request message may be
in the first node profile ( e.g. , a node verification private key ) . encrypted using a first key ( e.g. , a node verification public
In some embodiments, the first node profile may be corre- key ) of a node verification key pair associated with the
lated and / or associated with the first financial institution financial institution server computer. The financial institu
server computer using the first identifier ( e.g. , bank identi- tion server computer may then send the request message to
fication number ). 25 the server computer 150 via the communications network
In step 515 , the server computer 150 determines that a 115 or by any other appropriate communications means .
second financial institution server computer ( e.g. , distributor In step 610 , the server computer 150 determines that the
node 120A) is authorized to distribute the digital currency. financial institution server computer is an issuer node using
As described above , in some embodiments, the server com- a second key (e.g. , a node verification private key ) of the
puter 150 may receive a request from the second financial 30 node verification key pair associated with the financial
institution server computer requesting that the second finan- institution server computer. In some embodiments, the
cial institution server computer be designated as a node in server computer 150 may retrieve a node profile associated
the cryptocurrency payment network 145. In such embodi- with the financial institution server computer from the node
ments, the server computer 150 may determine the type of profiles database 150c . In some embodiments , the manage
financial institution associated with the second financial 35 ment system server computer 150 may retrieve the second
institution server computer. key of the node verification key pair from the retrieved
As with the first financial institution, the server computer profile for the financial institution server computer. The
150 may determine whether the second financial institution processor and an authentication module 1506-1 may use the
server computer is authorized to generate or distribute the retrieved second key to decrypt the request message in order
digital currency based on determining a second identifier 40 puter
associated with a second financial institution from the
to determine whether the financial institution server com
that sent the request message is an authorized issuer
request message from the second financial institution server node ( e.g. , 105A) .
computer. Where the financial institution is a commercial In step 615 , the server computer 150 authorizes the
bank, the financial institution server computer associated financial institution server computer to generate the digital
with the financial institution may be designated as a dis- 45 currency. The processor 150a and the authentication module
tributor node in the cryptocurrency payment network 145 , 150b - 1 in the server computer 150 may generate and send a
with the rights to distribute digital currency but not to issue response message to the financial institution server computer
or generate digital currency . indicating that the financial institution server computer
In step 520 , the server computer 150 generates a second 105A is authorized to generate and issue the digital currency
digital certificate for the second financial institution server 50 within the cryptocurrency payment network 145 .
computer. In some embodiments, the second digital certifi- In some embodiments, the server computer 150 may
cate may include a second key (e.g. , a node verification receive a second request message from a second financial
public key ) that may be used to authenticate the second institution server computer (e.g. , distributor node 120A) .
financial institution server computer as being authorized to The second request message may indicate that the second
distribute the digital currency to a user computing device . 55 financial institution server computer is requesting to distrib
The server computer 150 may also generate a second node ute digital currency. The request message may be encrypted
profile for the second financial institution server computer in using a third key ( e.g. , a second node verification public key )
the node profiles database 150c . The server computer 150 of a second node verification key pair associated with the
may store a key correlated with the second key in the second second financial institution server computer. The second
node profile ( e.g. , a node verification private key ). In some 60 request message may be received by the server computer
embodiments, the second node profile may be correlated 150 via the communications network 115 or by any other
and / or associated with the second financial institution server appropriate communications means. The server computer
computer using the first identifier ( e.g. , bank identification 150 may determine that the second financial institution
number ). server computer is a distributor node using a fourth key ( e.g. ,
In step 525 , the server computer 150 sends the first digital 65 a second node verification private key ) of the node verifi
certificate to the first financial institution server computer cation key pair associated with the second financial institu
and the second digital certificate to the second financial tion server computer. Once the second financial institution
US 11,055,707 B2
25 26
server computer has been determined to be an authorized figures, including any servers or databases, may use any
distributor node , the processor 150a and the authentication suitable number of subsystems to facilitate the functions
module 1506-1 in the server computer 150 may generate and described herein .
send a second response message to the second financial Examples of such subsystems or components are shown
institution server computer indicating that the second finan- 5 in FIG . 7. Any of the subsystems or components shown in
FIG . 7 can be included in any of the previously described
cial institution server computer (e.g. , 120A) is authorized to devices
distribute digital currency within the cryptocurrency pay FIG . 7 ,areapparatuses , or systems. The subsystems shown in
interconnected via a system bus 700. Additional
ment network 145 .
subsystems such as a printer 708 , keyboard 716 , fixed disk
III . Additional Embodiments 10 718 (or other memory comprising computer readable
media ), monitor 712 , which is coupled to display adapter
In alternative embodiments, each issuer node ( e.g. , 105A 710 ( 1/0
, and others are shown . Peripherals and input/output
) devices, which couple to I/ O controller 702 (which can
105N) in the cryptocurrency payment network 145 may
generate their own unique digital currencies once they have 15 be a processor or other suitable controller ), can be connected
been authorized by the management system server computer tothetheart,computersuch as
system by any number of means known in
serial port 714. For example, serial port 714
150. For example, issuer node 105A may generate digital or external interface 720 can be used to connect the com
currency A , issuer node 105B may generated digital cur puter apparatus to a wide area network such as the Internet,
rency B , etc. In such embodiments, each issuer node ( 105A a mouse input device, or a scanner. The interconnection via
105N) may be associated with a different central bank or 20 system bus allows the central processor 706 to communicate
may be associated with a company or any other entity. In with each subsystem and to control the execution of instruc
such embodiments , an entity such as a merchant could tions from system memory 704 or the fixed disk 718 , as well
generate and issue its own digital currency that may be used as the exchange of information between subsystems. The
to perform transactions with the merchant and /or with other system memory 704 and / or the fixed disk 718 may embody
payment entities associated with the cryptocurrency pay- 25 a computer readable medium .
ment network 145 . Specific details regarding some of the above -described
In other embodiments, a single issuer node (e.g. , 105C ) aspects are provided above . The specific details of the
may be able to generate a plurality digital currencies linked specific aspects may be combined in any suitable manner
to issuer node 105C . In such embodiments, a first digital without departing from the spirit and scope of embodiments
currency may be linked to a first fiat currency and a second 30 of the technology. For example, back end processing, data
digital currency may be linked to a second fiat currency . In analysis, data collection, and other transactions may all be
other embodiments , the first digital currency may be linked combined in some embodiments of the technology. How
to a first fiat currency and the second digital currency may ever, other embodiments of the technology may be directed
not be linked to a fiat currency . to specific embodiments relating to each individual aspect ,
35 or specific combinations of these individual aspects .
IV . Technical Benefits It should be understood that the present technology as
described above can be implemented in the form of control
Embodiments of the present invention provide a number logic using computer software ( stored in a tangible physical
of advantages and technical benefits. For example, embodi- medium ) in a modular or integrated manner. While the
ments of the present invention provide the benefit of a 40 present invention has been described using a particular
cryptocurrency payment network that has increased security combination of hardware and software in the form of control
from fraud as the participants ( e.g. , users , merchants) in the logic and programming code and instructions, it should be
cryptocurrency payment network may be known by the recognized that other combinations of hardware and soft
financial institutions (e.g. , bank ) through the establishment ware are also within the scope of the present invention .
of accounts linked to users personal details. As participants 45 Based on the disclosure and teachings provided herein, a
in the cryptocurrency payment network have accounts with person of ordinary skill in the art will know and appreciate
financial institutions, this allows for better tracking of pay- other ways and / or methods to implement the present tech
ment transaction details . This reduces the risk of fraud being nology using hardware and a combination of hardware and
perpetrated by anonymous entities within the cryptocur software
rency payment network , which can be an issue in typical 50 Any of the software components or functions described in
systems , such as Bitcoin. this application , may be implemented as software code to be
In addition , in embodiments of the present invention , each executed by a processor using any suitable computer lan
of the nodes ( e.g. , issuer nodes, distributor nodes ) must be guage such as , for example , Java , C ++ or Perl using , for
authenticated and approved by the management system example , conventional or object -oriented techniques. The
server computer, ensuring that only specific entities (e.g. , 55 software code may be stored as a series of instructions, or
central banks, government agencies) have the right and commands on a computer readable medium , such as a
ability to issue and generate digital currency for the system . random access memory (RAM ), a read only memory
In combination with the ability to link the digital currency to (ROM ) , a magnetic medium such as a hard - drive or a floppy
a fiat currency, this provides both enhanced security that the disk, or an optical medium such as a CD - ROM . Any such
digital currency is valid and prevents value fluctuations of 60 computer readable medium may reside on or within a single
the digital currency . computational apparatus, and may be present on or within
different computational apparatuses within a system or net
V. Example Computer Systems work .
The above description is illustrative and is not restrictive .
The various participants and elements described herein 65 Many variations of the technology will become apparent to
may operate one or more computer apparatuses to facilitate those skilled in the art upon review of the disclosure. The
the functions described herein . Any of the elements in the scope of the technology should , therefore , be determined not
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27 28
with reference to the above description , but instead should sending, by the first payment entity computer to the
be determined with reference to the pending claims along distributor node computer and the issuer node com
with their full scope or equivalents. puter, the fourth payment transaction message indi
In some embodiments, any of the entities described herein cating the transfer of the amount of the digital
may be embodied by a computer that performs any or all of 5 currency to the second payment entity ;
the functions and steps disclosed . receiving, by the distributor node computer, the fourth
One or more features from any embodiment may be payment transaction message ;
combined with one or more features of any other embodi- validating, by the distributor node computer, the trans
ment without departing from the scope of the technology. fer of the amount of the digital currency using the
A recitation of “ a ” , “ an ” or “ the” is intended to mean “ one 10 digital signature in the fourth payment transaction
or more” unless specifically indicated to the contrary. message ;
All patents, patent applications, publications, and descrip- updating, by the distributor node computer, a first
tions mentioned above are herein incorporated by reference blockchain ledger of transactions to include infor
in their entirety for all purposes. None is admitted to be prior mation describing the transfer of the amount of the
art . 15 digital currency from the first payment entity to the
second payment entity ;
What is claimed is : receiving, by the issuer node computer, the fourth
1. A computer - implemented method comprising: payment transaction message indicating the transfer
transmitting, by an issuer node computer to a manage of the amount of the digital currency from the first
ment system server computer, a request message to 20 payment entity to the second payment entity;
generate digital currency, the request message validating, by the issuer node computer, the transfer of
encrypted using a first key indicating that the issuer the amount of the digital currency using the digital
node computer is authorized to generate the digital signature in the fourth nent transaction message ;
currency ; and
determining, by the management system server computer, 25 updating, by the issuer node computer, a second block
that the issuer node computer is authorized to generate chain ledger of transactions to include information
the digital currency using a second key, the second key describing the transfer of the amount of the digital
associated with the issuer node computer and being part currency from the first payment entity to the second
of a key pair comprising the first key and the second payment entity.
key ; 30 2. The method of claim 1 , wherein the first identifier is a
authorizing, by the management system server computer, public key of the first payment entity.
the issuer node computer to generate the digital cur- 3. The method of claim 1 , further comprising:
rency by transmitting a response message to the issuer generating by the management system server computer, a
node computer; digital certificate authorizing the issuer node computer
generating, by the issuer node computer, the digital cur- 35 to generate the digital currency, the digital certificate
rency ; comprising the first key; and
transferring, by the issuer node computer, the digital distributing, by the management system server computer
currency to a distributor node computer by to the issuer node computer, the digital certificate .
generating, by the issuer node computer, a second 4. The method of claim 1 , wherein the digital currency is
payment transaction message indicating that the 40 a cryptocurrency.
digital currency is transferred to the distributor node 5. The method of claim 1 , further comprising granting, by
computer, and the management system server computer to the issuer node
receiving, by the distributor node computer, the second computer, an issuer node digital certificate authorizing the
payment transaction message ; issuer node computer to generate the digital currency , the
distributing, by the distributor node computer to a first 45 issuer node digital certificate comprising the first key, and
payment entity computer associated with a first pay- granting, by the management system server computer to the
ment entity, the digital currency via a third payment distributor node computer, a distributor node digital certifi
transaction message using a private key indicating that cate, the distributor node digital certificate comprising the
the distributor node computer is authorized to distribute private key.
the digital currency ; 50 6. The method of claim 1 , wherein validating the transfer
transferring, by the first payment entity computer, an comprises using a transaction public key of the first payment
amount of the digital currency to a second payment entity corresponding to a transaction private key of the first
entity by payment entity used to create the digital signature to verify
generating, by the first payment entity computer, a the digital signature.
fourth payment transaction message to transfer the 55 7. The method of claim 1 , wherein the management
amount of the digital currency from the first payment system server computer determines that the issuer node
entity to the second payment entity , the fourth pay- computer is authorized to generate the digital currency using
ment transaction message including a first identifier the second key by :
for the first payment entity, a second identifier for the retrieving a profile associated with the issuer node com
second payment entity, the amount of the digital 60 puter stored in a database;
currency, and a digital signature; retrieving the second key stored with the retrieved profile ;
transmitting, by the first payment entity computer to a and
second payment entity computer associated with the determining that the retrieved second key is associated
second payment entity, the fourth payment transac with the first key of the key pair received in the request
tion message ; 65 message .
receiving, by the second payment entity computer, the 8. The method of claim 7 , wherein the management
fourth payment transaction message ; system server computer determines that the retrieved second
US 11,055,707 B2
29 30
key is associated with the first key of the key pair received retrieving a profile associated with the distributor node
in the request message by applying a decryption algorithm computer stored in a database;
to the encrypted request message to issue the digital cur retrieving the public key stored with the retrieved profile;
rency using the second key to decrypt the request message . and
9. The method of claim 1 , wherein the issuer node 5 determining that the retrieved public key is associated
computer generates the digital currency according to a value
of an associated fiat currency. with the private key of the second key pair received in
10. The method of claim 1 , wherein distributing, by the the request message to distribute the digital currency .
distributor node computer to the first payment entity com- 12. The method of claim 11 , further comprising:
puter associated with the first payment entity, the digital 10 applying , by the management system server computer, a
currency using the private key indicating that the distributor decryption algorithm to the encrypted request message ;
node computer is authorized to distribute the digital cur and
rency comprises:
transmitting, to the management system server computer, distributing, by the management system server computer,
a request message to distribute the digital currency , the 15 the digital currency using the public key to decrypt the
request message encrypted using the private key, request message .
wherein the management system server computer deter- 13. The method of claim 1 , wherein distributing, by the
mines that the distributor node computer is authorized distributor node computer to the first payment entity com
to distribute the digital currency using a public key, the puter associated with the first payment entity, the digital
public key associated with the distributor node com currency using the private key indicating that the distributor
puter
privateand
keypart
and oftheapublic
secondkeykey
, pair comprising the 20 rency
node computer is authorized to distribute the digital cur
and wherein the management system server computer
comprises:
authorizes the distributor node computer to distribute generating , by the distributor node computer, a payment
the digital currency by transmitting a response message transaction message to distribute the digital currency to
to the distributor node computer. 25 the first payment entity, the payment transaction mes
11. The method of claim 10 , wherein the management sage including an address of the distributor node com
system server computer determines that the distributor node puter, an address of the first payment entity, and a
computer is authorized to generate the digital currency using digital signature generated using the private key.
the public key by :