WO2014143720A2 - Systems and methods for a private sector monetary authority - Google Patents
Systems and methods for a private sector monetary authority Download PDFInfo
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- WO2014143720A2 WO2014143720A2 PCT/US2014/027797 US2014027797W WO2014143720A2 WO 2014143720 A2 WO2014143720 A2 WO 2014143720A2 US 2014027797 W US2014027797 W US 2014027797W WO 2014143720 A2 WO2014143720 A2 WO 2014143720A2
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- G—PHYSICS
- G06—COMPUTING; CALCULATING OR COUNTING
- G06Q—INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR
- G06Q20/00—Payment architectures, schemes or protocols
- G06Q20/04—Payment circuits
- G06Q20/06—Private payment circuits, e.g. involving electronic currency used among participants of a common payment scheme
Definitions
- the present invention relates to the fields of alternative currency and payment systems. More specifically, the present invention relates to systems and methods of
- Leptokurtosis The frequency of disruptive market events involving the financial system and affecting the real economy does not conform to a Gaussian (the classic "bell-shaped” curve) statistical probability distribution. Instead, statistical patterns of deviation manifest "leptokurtosis”; events of intermediate deviation occur less frequently than would be predicted by a random distribution while both smaller and much more extreme deviations occur more often. Instead of the "100 year flood" occurring about once per century, it recurs virtually each decade.
- Base Money Two types of Base Money. Reserves of banks held in electronic form as deposits with a government Monetary Authority currently comprise the major component of the monetary base (or "Base Money") - the direct Monetary Liabilities of that Monetary Authority. The other component of Base Money issued by government Monetary Authorities consists of paper cash and coins.
- the Fed must stand prepared to serve as a Lender of Last Resort, supplying funds to prevent a cascading sequence of defaults due to banks relying on incoming transfers to fund transfers in which they are the payer.
- Monetary Policy and its goals The concept of, the very term, "monetary policy” implies discretionary goals of an economic nature. With fiat money as issued by government central banks, exemplary goals include stability of the purchasing power of money. In the United States the Fed also has a mandate to foster full employment. Empirical observation would suggest that pursuit of any economic goal via monetary policies results in an asymmetric ratcheting process favoring stimulus and lower interest rates leading to accumulations of debt that eventually result in loss of control, risking monetary and economic collapse.
- Moody's, Fitch and Standard & Poor's provide ratings based on sophisticated data-driven analysis, rating changes tend to exhibit latency— closing the barn door after the horse is gone— that diminishes their value as a restraining influence on formation of government fiscal policy.
- Government currency board 25 Hostage to policies of anchor Currency.
- a government currency board is constituted to maintain a hard exchange rate peg to and assured convertibility into a designated Outside Money, or anchor Currency. While this reduces or eliminates the ability of such a Monetary Authority to manipulate interest rates or monetize the debts of its host government, it leaves such a Currency completely hostage to the discretionary monetary policies of the central bank that issues the anchor Currency.
- Real Money While there are numerous systems, conventional and alternative, for remote payments, most circulate Broad Money obligations of existing government issued Currencies. PAYPAL for example is a widely used alternative but it is used to convey liabilities denominated in USD, EUR, GBP etc. and payable with conventional bank deposits. All government issued Currencies of course are examples of Real Money as defined below but all remote payment systems that circulate existing forms of Real Money involve the Broad Money form during some or every phase of a transfer transaction. A few systems, however, undertake to issue their own distinct alternative Currency. Recent examples of privately issued alternative Currencies include LINDEN Dollars, FACEBOOK Credits and BITCOIN. No existing or previously disclosed scheme for privately issued alternative Currency, however, has undertaken or proposed to issue a Currency that would meet the offered definition of Real Money. In particular, none have embodied characteristics that might cause banks to embrace them, holding reserve balances of them underlying deposits denominated and payable in them.
- Payer default. Payments conducted via draft instruments with delayed settlement such as checks and ACH transfers, are subject to reversal due to insufficient funds on the part of the payer. A bounced check is a familiar example.
- Payments conducted via credit card or credit card intermediaries such as PAYPAL may be reversed by the payer even though the merchant recipient has accepted payment in good faith and performed all obligations. This is particularly problematic for sellers of digital content or electronic goods that may be delivered and or consumed online.
- Bank wires The processing of bank wires commonly involves a bank employee transcribing and uploading the payer's wire instruction introducing delay and the risk of error. While a domestic bank wire may result in available funds for the recipient in a manner of minutes, delays are very common. With international bank wires, the situation is worse, with delays often ranging from several days to several weeks, depending partly on how backward the banking infrastructure is at either source or destination country. Upon inquiry, banks typically offer only opaque uninformative excuses for the cause of such delays. Bank wires are also subject to substantial fees, commonly affecting payer and recipient.
- Figure 14 demonstrates the host of financial intermediaries involved with conventional money transmission protocols. With multiple intermediaries the cost structure passed on to the customer entails minimum transaction fees high enough to make such systems uneconomical for small value transfers.
- the transmission process is also inflexible, essentially bundling two exchanges to the actual transfer of value from payer to recipient.
- the first exchange consists of the payer exchanging cash for a promise to pay.
- the second exchange is the recipient exchanging the promise to pay for cash. If the cash paid in is a different Currency than the cash paid out, as with international remittances, there is also an obligatory exchange rate spread, adding to the overall transaction cost.
- Such systems are also inflexible with regard to distribution at the recipient end; whatever quantity is remitted is paid out in its entirety to the designated recipient.
- Embodiments of the present invention may provide systems and methods for administering a private sector Monetary Authority.
- the potential macro-economic and political impact/benefits of the system comprise an integral component system in that the directly administered elements of the system are designed to exert such impact via the described emergence scenario.
- the overall system while designed with such an ultimately beneficial path in view, cannot prevent nearer term financial and economic disruptions due to embedded flaws and contradictions of existing systems nor can it forestall transitional disruptions.
- the system, both directly administered elements and the broader system of ramifications is designed in anticipation of transitional effects that would inevitably result from its emergence and takes advantage of them to facilitate commercial success and emergence.
- Embodiments of the present invention enable one or more alternative Currencies, each with a money supply that is automatically self-adjusting.
- This self- adjusting money supply combined with systems serving as efficient channels of adjustment, may attenuate financial fluctuations and the economic disruptions that result from them.
- the result may be a financial system that, while comprised of institutions such as banks engaged in business that is inherently risky, does not generate instability.
- Emergence of the present invention may also serve to foster sustainable government fiscal policies and practices.
- 51. Leptokurtosis The leptokurtosis currently evident in the statistical distribution of economic deviations may diminish because the disclosed mechanisms of automatic self- adjustment are more vibrantly incremental, with less latency and less subject to manipulations that tend to short circuit channels of adjustment.
- the system of the present invention enables direct End User access to Base Money that is electronic and transferable via a remote payments system affording immediate settlement.
- This direct access to such a medium of exchange and to efficient mechanisms for making and receiving transfers of it may facilitate, for the first time ever, the free and convenient flow of reserves into or out of the banking/financial system in such a way as to modulate their supply and cost without the middleman inefficiencies of an interposed bureaucracy.
- Any End User electing to eschew the financial risks of holding deposits in the banking system at prevailing interest rates in favor of directly holding Base Money balances may do so without sacrificing the convenience of access to efficient remote payments capabilities.
- Every economic actor using the System may exercise a continuous and extraordinarly incremental influence over both Base Money supply and interest rates with their every decision as to whether to hold Base Money, securities or the deposits of a financial institution.
- Obligatory financial intermediaries The disclosed system enables individuals and firms to make or receive remote payments without any interposed financial intermediary, reducing the costs, delays and settlement risk of payment.
- Base Money issued by means of the disclosed system exists and circulates only in electronic form, by book entries in an accounting system.
- Emergence of the disclosed system would not be expected to impact the decision making processes of existing Monetary Authorities with regard to their continued issuance of hand-to- hand anonymous tokens.
- Finality of settlement The disclosed System may achieve finality of settlement without resort to any lender of last resort guarantee by means of technical elements bolstered by contractual provisions.
- the only conditionality of settlement may be to enable a mechanism for addressing transfers in execution of instructions that are later determined to have been erroneous or unauthorized. This mechanism may balance the possibility of recovery against the imperative of not damaging an innocent third party.
- the present system eschews any monetary policy but rather is governed by unambiguous contracts defining the Monetary Liabilities of any Issuer. Rather than targeting any particular economic outcome, the system defines a Cartesian origin - a fixed monetary relationship that may serve as a reference point and anchor for all other monetary and financial arrangements. This Cartesian origin is the requirement of a 100% reserve of physical gold backing any and all of the gold linked Currency in circulation such that every gram of the Currency is backed by at least a gram (fine content) of gold bullion.
- the gold-based Currency of the disclosed system may provide an external monetary benchmark relative to which the exchange rate of government-issued Currencies may freely decline
- Embodiments of the disclosed system provide for two categories of Currency.
- the core Currencies are commodity-linked and - backed with a 100% reserve of the physical commodity.
- a secondary category is comprised of Base Moneys issued in accordance with a conventional currency board model.
- the commodity- linked/backed Currencies are not subject to discretionary influences.
- the disclosed system enables access to an efficient remote payment system separate from and completely independent of banks, circulating Base Money that in embodiments involving commodity-linked Currency embodies no element of credit or credit risk.
- Bank involvement in payments systems amplifies supply of money and credit.
- the disclosed system enables both greater disintermediation and efficiencies of payment which combined reduce overall need for money and excesses in the overall supply of money and credit.
- Broad money supply escapes control The disclosed system enables the broad public to incrementally withdraw from exposure to financial system whether formal banking sector or "shadow banking" intermediaries, thereby attenuating or preventing excessive expansion of Broad Money and credit that sets the stage for subsequent busts.
- the disclosed system enables immediate settlement of transfers, supporting greater velocity of money.
- the system may include an account maintenance fee that may exert a Demurrage effect, further stimulating velocity enabling a smaller stock of money to support a greater level of economic activity.
- the disclosed system eliminates the risk of payment reversal due to insufficient funds on the part of the payer.
- the recipient may elect to retain some or all of the received amount on account, and/or to transfer portions when convenient to subsequent recipients who similarly are not obliged to exchange for local currency.
- this system is not exposed to the costs and risks of payment repudiation of other payment systems. This lack of dependence on and exposure to the risks of other payment systems enables lower fees and an assurance of non-repudiation mitigating or eliminating involuntary losses due respectively to fraud or payer default for recipients that receive payment in good faith and perform their obligations.
- the disclosed system embodies no element of credit due to automated enforcement of a strict debit rule. Since it is immune to payer default it can be made available to people around the world regardless of their credit history or lack of established credit, including the unbanked.
- the disclosed system maintains permanent records of every transfer enabling the entire lineage of every particle of value in circulation to be traced back to its initial issuance.
- the disclosed system unlike any existing conventional payment system, maintains a consolidated central database enabling superior detection, interdiction and reporting of abuses such money laundering.
- criminal efforts for example, to structure cash exchanges so as to facilitate their placement in the financial system would be thwarted by the system's superior ability to detect aggregation of small value flows or other criminal patterns involving a network clandestinely operating under unified or coordinated control.
- Benefits of the present invention do not require consensus or even widespread understanding or embrace of the underlying theory on the part of users to achieve its benefits.
- the benefits are proportionate to embrace and usage and may manifest as an emergent phenomenon. As such, the benefits may be more likely to become manifest after an inflection point marking a phase change where the attainment of a critical mass of usage ignites network effects that broaden and accelerate the macroeconomic and political impact of the system.
- Embodiments of the present invention may include a payment system for use with Base Money of one or more alternative currencies.
- the system may include at least one processor and at least one memory, wherein the at least one processor is adapted to perform one or more of the following steps: administering one or more accounts, each of which belongs to one or more account owners; receiving one or more spend instructions specifying an account-to- account transfer of a quantity of base money from at least one paying account to at least one recipient account; receiving one or more spend authorizations for the one or more spend instructions from one or more system users with requisite privileges for the at least one paying account; and executing the one or more authorized spend instruction if they conform to all applicable system rules by crediting the at least one paying account and debiting the at least one recipient account in an atomic transaction that executes in its entirety or not at all; and wherein at least one of the one or more alternative currencies are based on at least one commodity and are continuously backed by a 100% reserve of the at least one commodity.
- the functions of the payment system may be selected from the group consisting of issuance, distribution, circulation, redemption, de-issuance of at least one base money of the one or more alternative currencies, and combinations thereof.
- Certain embodiments may include creating the one or more accounts.
- the creating may include initiating the one or more accounts on behalf of and as authorized by the one or more account owners. With the exception of one or more mint accounts each belonging to a particular issuer, each of the one or more accounts may be an asset account from the perspective of the one or more account owners of the one or more accounts.
- the one or more spend instructions may include: payer account; one or more recipient account; a particular currency designation; and quantity of base money of the particular currency designation to be conveyed to each of the one or more recipient account. Wherein, with the exception of an issuance spend, the quantity conveyed by the one or more spend instructions may be less than or equal to the available balance of the at least one paying account, which available balance may be zero or greater.
- the one or more spend instructions may be one or more issuance spend instructions, wherein the at least one paying account may be a mint account belonging to an issuer of a base money specified in the one or more issuance spend, and which issuance spend may result in an increase in the outstanding Base Money liabilities of that issuer in circulation.
- the one or more spend instructions may be one or more distribution spend instructions, wherein the at least one paying account may be an account belonging to an issuer of a particular base money specified in the one or more distribution spend instructions, and the at least one recipient account may be an account of a primary dealer.
- the one or more spend instructions which may be one or more issuance spend instructions may or may not also be one or more distribution spend instructions.
- the one or more spend instructions may be one or more redemption spend instructions, wherein the at least one paying account may be an account belonging to a primary dealer, and wherein the at least one recipient account may be an account of an issuer of a particular base money specified in the one or more redemption spend instructions.
- the one or more spend instructions may be one or more de-issuance spend instructions, wherein the at least one recipient account may be a mint account belonging to an issuer of a particular Base Money specified in the de-issuance spend instruction, and wherein the one or more de-issuance spend instructions may result in an decrease in the outstanding base money liabilities of that issuer in circulation.
- the one or more spend instructions which may be one or more redemption spend instructions may or may not also be one or more de-issuance spend instructions.
- Certain embodiments may include receiving one or more requests for a report of pending spend instructions, processed spend instructions, balances or other characteristics representing one or more current or prior state of the one or more accounts, characteristics pertaining to the one or more accounts, and combinations thereof. Certain embodiments may include determining whether a request for a report, the one or more spend instructions, or the one or more spend authorizations are authentic and from an identified system user. Certain embodiments may include determining whether the authenticated system user has the requisite privileges for the system to further process the request for a report, the one or more spend instructions, or the one or more spend authorizations. Other business objects invoked with request for a report, the one or more spend instructions, or the one or more spend authorizations may have requisite privileges.
- Embodiments may include determining a quantity of settlement currency to convey if the one or more spend instructions are specified using a different numeraire than that of the settlement currency.
- Embodiments may include displaying to a system user with requisite privileges on the at least one paying account, prior to the system accepting authorization from that system user of the one or more spend instructions specified using a different numeraire than that of the settlement currency, the quantity of settlement currency to be conveyed and the factors used in calculating that quantity.
- Embodiments may include generating, displaying or delivering one or more notifications regarding pending or already effected changes of state affecting an account, system user, account owner, or other business objects to one or more system users with requisite privileges to receive such notifications.
- Embodiments may include generating, displaying, or delivering one or more reports in fulfillment of properly authorized requests.
- the base money may be in the form of one or more book entries in an accounting system accessed by the at least one processor.
- An issuer may be a system participant specially credentialed to authorize issuance spends, by which new base money, constituting a direct liability of that issuer, is created.
- a mint account may be an account belonging to the issuer of base money of a particular alternative currency and representing a direct liability of that issuer, the balance of which, expressed as an absolute value, equals the aggregate balance of that base money in all other like-denominated accounts combined.
- a primary dealer may be a system participant specially credentialed to: receive distribution spends where newly issued base money is introduced into circulation, and make redemption spends by where base money is retired from circulation to be de-issued. Transactions resulting in an obligation on the part of an issuer to issue and distribute new base money, and to redeem and de-issue base money, may be only initiated and conducted by primary dealers, such that no issuer exercises discretionary authority over the quantity of base money in circulation within the system.
- the system may be a closed system where base money cannot leave and outside money cannot enter.
- the at least one commodity may be gold.
- An issuer may be bound by an explicit declaration of liability requiring continuous backing by a 100% reserve of physical gold and denominated in a unit of account corresponding to the weight units conventionally used for specifying physical quantities of gold.
- the issuer of the base money may be a government monetary authority. Reserves backing the base money may not be loaned, hypothecated or encumbered for any purpose.
- Base money of one or more secondary currencies may be issued, distributed, circulated, redeemed, and de-issued in the system, wherein the base money of the one or more secondary currencies may be backed at least in part by financial instruments and may be anchored to at least one existing national currency.
- One or more issuer of the base money of the one or more secondary currencies may be a government monetary authority.
- An issuer user may redeem and de-issue any or all base money on demand.
- An issuer user may issue and distribute additional base money on demand.
- the one or more spend instructions may be executed and settled immediately.
- the one or more spend instructions may be specified and pre-authorized for execution and settlement at a future time.
- a system user may act on his own behalf as account owner.
- a system user may act on the authority and behalf of one or more other persons, which persons may be human beings or legal persons, as account owner. More than one system user may be authorized to exercise privileges involving a particular account.
- the system user may be authorized to exercise privileges involving more than one account.
- a person may own one or more accounts, solely or jointly with other account owners.
- Certain embodiments may include payment system for use with base money of one or more alternative currencies.
- the system may include at least one processor and at least one memory, wherein the at least one processor may be adapted to perform one or more of the following steps: promulgating terms of access and use of all system resources; credentialing one or more system participants to perform one or more of the specialized roles of issuer, primary dealer, or exchange provider; granting to properly credentialed system participants sets of privileges necessary to perform one or more of the specialized roles of issuer, primary dealer, exchange provider, or depository institution; assisting in the provisioning of accounts for the one or more specialized roles of issuer, primary dealer, exchange provider, or depository institution; receiving significations of acceptance of terms of access and use from prospective participants, or system privileges tendered at a request or instruction of a system provider or other system participant; wherein at least one of the one or more alternative currencies are based on at least one commodity and are continuously backed by a 100% reserve of the at least one commodity.
- the functions of the payment system may be selected from the group consisting of issuance, distribution, circulation, redemption, de-issuance of at least one base money of the one or more alternative currencies, and combinations thereof.
- One or more of the exchange providers may be a primary dealer.
- Certain embodiments may include credentialing one or more system participant to perform the specialized role of depository institution.
- One or more of the depository institutions may be primary dealers.
- Certain embodiments may include receiving requests from prospective system users to be granted log-in privileges.
- Certain embodiments may include receiving requests from established system users with log-in privileges to create one or more accounts for the benefit of themselves or for other persons.
- Certain embodiments may include requests to establish or modify a throughput limit on one or more accounts belonging to a particular owner or group of owners.
- Certain embodiments may include receiving requests from a system participant to grant, modify or revoke privileges of another system participant pertaining to particular accounts or other business objects resulting in an auditable chain of authority. Certain embodiments may include receiving requests from a system participant for removal of privileges already granted. Certain embodiments may include receiving requests for reports. Certain embodiments may include receiving submissions of data or assertions regarding identifiers submitted by logged-in system users seeking privileges to create and provision accounts on behalf of themselves or authorized by and to be owned by other persons. Certain embodiments may include receiving submissions of data or assertions regarding sources of income of system participants. Certain embodiments may include receiving submissions of data or assertions regarding nature of business activities for system participants that are businesses.
- Certain embodiments may include receiving submissions of data or assertions regarding intended usage of accounts including estimates of anticipated transaction volumes. Certain embodiments may include: receiving one or more spend instructions specifying an account-to-account transfer of a quantity of base money from at least one paying account to at least one recipient account; receiving one or more spend authorizations for the one or more spend instructions from one or more system users with requisite privileges for the at least one paying account; and executing the one or more authorized spend instruction if they conform to all applicable system rules by crediting the at least one paying account and debiting the at least one recipient account in an atomic transaction that executes in its entirety or not at all. Certain embodiments may include receiving one or more authorizations from a prospective or existing system participant lacking log-in privileges for another system participant to interact with the system on its behalf.
- Certain embodiments may include receiving complaints directly from system participants. Certain embodiments may include receiving complaints from external sources such as government agencies on behalf of system participants. Certain embodiments may include receiving claims that a spend was erroneous or unauthorized. Certain embodiments may include tracking complaints and claims as to enable an auditable record from receipt through evaluation, response, or resolution. Certain embodiments may include overriding existing privileges on an account to recover and restore value in appropriate instances of unauthorized or erroneous spends. Certain embodiments may include banning designated persons from system participation. Certain embodiments may include receiving instructions to close an account. Certain embodiments may include performing customer identification procedures to validate the identity of system users and prospective account owners and to prevent multiple enrollments and the matriculation to or usage of the system by proscribed persons. Structured conduct and recording of remote video and audio interview site inspection of a business may be used to corroborate and augment conventional verification and
- Certain embodiments may include performing due diligence evaluating sources of income and projected usage of system. Certain embodiments may include monitoring transaction activity to detect one or more of the following: unauthorized spends; indices of money laundering or terrorist finance; and patterns indicating other illicit activity or violations of system terms of use. Certain embodiments may include performing investigation as a result of or in response to one or more of the following: complaints of system participants; claims of erroneous or unauthorized spends; reports from external sources of security threats or possible illicit activity on the part of system participants; and unusual activity detected by the system's transaction monitoring process. Certain
- embodiments may include granting, modifying, or revoking privileges of system participants. Certain embodiments may include executing instructions and fulfilling requests from system users that are authenticated as authorized and which conform to system rules. Certain
- embodiments may include reporting suspicious activity to government authorities as required. Certain embodiments may include persisting data comprising the system and its component objects.
- An unauthorized spend may be a spend for which the spend instruction was not properly authorized, but which was executed and settled. The spend instruction may not be properly authorized due to compromise of authentication credentials or tokens of a system user with the requisite privileges.
- An exchange provider may be a system participant granted the right to engage in currency exchange transactions, as a business, with other system participants in which either or both the funding or fulfillment payment of such currency exchange transactions may require a spend instruction.
- a depository institution may be a system participant granted the right to hold value on account, as a business, which liabilities constitute assets of other system participants and regarding which either the funding or repayment of such balances requires a spend instruction.
- Extended due diligence may be performed for system participants engaged in business activities associated with an increased risk of money laundering.
- System user interactions may be channelized to reduce risks of erroneous or unauthorized spends, to impede efforts to use the system for illicit purposes, and to more readily detect such abuses that slip through.
- System users that are businesses may be required to use a prescribed Account Module of multiple accounts of specialized types, belonging to a particular owner or group pof owners, such account types including: one or more accounts that can only receive spends from accounts not contained within their Account Module and can only make spends to one or more accounts within their Account Module, one or more accounts that can only make or receive spends to or from other accounts within their Account Module, and one or more accounts that can only receive spends from accounts within their Account Module and can make spends to accounts not contained within their Account Module. Certain accounts of the type that can only receive spends from accounts not contained within their Account Module are further restricted as to only receive spends constituting revenue.
- Certain of the accounts that are restricted as to only receive revenue can only receive spends generated by shopping cart software associated with a particular Universal Resource Locator (URL). Certain accounts of the type that can only receive spends from accounts not contained within their Account Module are further restricted as to only receive spends from financial institutions, and, certain accounts of the type that can make spends to accounts not contained within their Account Module are further restricted as to only be able to make such external spends to financial institutions.
- URL Universal Resource Locator
- Embodiments may include an administration system to enable an issuer to administer base money of one or more alternative currencies.
- the system may include at least one processor and at least one memory, wherein the at least one processor may be adapted to perform one or more of the following steps: promulgating a declaration of liability defining the nature of an issuer's monetary liabilities; providing an interface to one or more primary dealers enabling the one or more primary dealers to initiate and conduct open market operations;
- the functions of the payment system may be selected from the group consisting of issuance, distribution, circulation, redemption, de-issuance of at least one base money of the one or more alternative currencies, and combinations thereof.
- An issuer may be a person with the ability and responsibility to issue, distribute, redeem and de- issue quantities of base money, which quantities constitutes direct liabilities of that issuer.
- a primary dealer may be a person specially credentialed and designated to serve as the
- Open market operations may be exchanges of value in which a primary dealer conveys: (1) outside money or other specified assets to issuer, in accordance with that issuer's declaration of liability and other system rules, leading to an obligation on the part of issuer to issue new commodity based money and distribute it to that primary dealer, or (2) commodity based money to issuer, in accordance with that issuer's declaration of liability and other system rules, leading to an obligation on the part of issuer to remove that money from circulation and release specified assets in accordance with the delivery instructions of the primary dealer.
- the external sources may be bullion repositories or financial institutions. Certain embodiments may include publishing data regarding the quantity of commodity-based money in circulation and the quantity and nature of assets held against those liabilities.
- Certain embodiments may include persisting data.
- the issuer may provide for a third party to serve as an additional required signatory for any release of assets that had been held to offset the issuer's commodity based monetary liabilities.
- Commodity holdings serving as reserves underlying base money may be titled to a trust.
- the underlying commodity may be a precious metal.
- the underlying commodity may be gold.
- Figure 1 shows an exemplary technical system architecture for provision and administration of a private sector Monetary Authority in a networked computing environment.
- Figures 2 A and 2B shows an exemplary organizational structure for one possible embodiment.
- Figure 3 shows a system whereby an Applicant may progress to become an Account Owner.
- Figure 4 shows a system of Spends and the environment within which they may be conducted.
- Figure 5 shows a system of classification for Persons and subsets of Persons as addressed in the disclosed system.
- Figure 6 shows a method the logic of which the system applies in processing a
- Figure 7 shows a system for Bailment of assets and Issuance of Base Money. 112.
- Figure 8 shows a system for Redemption of Base Money and release of assets.
- Figure 9 shows a system for an Exchange Provide to sell Base Money to its customers.
- Figure 10 shows a system for an Exchange Provide to buy Base Money from its customers.
- Figure 11 shows a system for funding a BMP Account via a BMP Account
- Figure 12 shows a system for a participating Depository Institution to provide Currency exchange via BMP Accounts.
- Figure 13 shows a system for organizing the Account Module of an Exchange Provider.
- Figure 14 shows a legacy system used by conventional money transmitting businesses.
- Embodiments of the present invention may include systems: a) designed to serve as a private sector Monetary Authority, and, b) for administering a community of participants, matriculation to which is a prerequisite for access to the products and services of the private sector Monetary Authority.
- Base Money of Currencies The Base Moneys that may be held and circulate within the system may be classified into core and secondary groups, further disclosed below.
- One such Base Money (in the core group) is linked to and backed by a 100% reserve of gold and constitutes an obligatory element for the system to achieve the full range of beneficial macroeconomic effects disclosed herein.
- the Remote Payments System may include a Settlement Platform with an Account mechanism that enables participating
- the Settlement Platform also may provide a mechanism and interface enabling Members designated as Issuers to Issue and De-Issue these Base Moneys.
- the only means of obtaining a Balance of one of the Base Moneys in circulation is by receiving a Spend from an Account belonging to a Member that already owns some. 120.2.1.1. Accounts.
- the System Provider is a corporate entity separate and distinct from any entity serving as Issuer, particularly with regard to their balance sheets, no Balance held in any Account on the Settlement Platform, with the exception of Accounts belonging to the System Provider itself, would constitute either a liability or an asset of the System provider.
- an Issuer would neither have nor need to have knowledge of the End Users holding quantities of its Monetary Liabilities as their asset, contractually delegating all responsibility for administering and keeping track of all such Accounts and their contents to the System Provider.
- Such an arrangement unprecedented with regard to the settlement platforms maintained by any government Monetary Authority, may warrant usage of the descriptive term "wallet" as an alternative to "account”.
- Systems may be provided to support much higher transaction volumes than would be processed on systems with a narrower range of participants. Systems may place greater emphasis on provision of commercially attractive products and services that a wide range of economic actors, including financial institutions, voluntarily embrace without the coercive advantage conferred on government Monetary Authorities by virtue of the legal tender status accorded to their Monetary Liabilities.
- Monetary authorities are backed by implicit or explicit government guarantees, the value of Monetary Obligations issued via and circulating within the present system may rest only on the assets held against them secured by a well- conceived institutional governance model. In the case of the disclosed gold-linked Base Money, value may be secured by continuous maintenance of a 100% reserve of physical gold held in suitable custodial arrangements.
- the disclosed system may support a more global community of participants. While potentially global, the system may be closed in the sense that all participants are subject to systematically implemented conditions and requirements for matriculation to and continued participation in the system.
- a Spend is an Account-to-Account transfer, effected by book entry crediting the Account of the payer and debiting the Account(s) of the recipient(s) in an atomic transaction in fulfillment of a Spend Instruction that has been authorized in advance by an authorized User on the paying Account with said authorization
- Figure 4 shows a system 400 by which Payer 401 may transfer value directly to
- FIG. 6 shows a system 600 for an exemplary logical flow for the processing of a Spend, following system authentication that the User authorizing the Spend instruction has requisite privileges.
- the system may perform basic pre-screening with client side apps analyzing the potential acceptability of a nascent Spend Instruction in the light of data - such as Available Balance - forward cached to the client computing device.
- the system may support specification and submission of a Spend Instruction from an interface provided to an already logged-in Account User on the paying
- Systems may also support Spend Instructions in which one or more of the parameters of Spend Instruction is generated by a Shopping Cart Interface. Such systems may provide for better tracking and control to avoid payment duplication and to assure an incoming payment can be associated with the correct invoice and or other documentary artifacts of the transaction in the records of the recipient.
- the Numeraire for specifying the amount of a Spend in a Spend Instruction may differ from that of the Settlement Currency to be conveyed via the Spend.
- a Spend Instruction may specify "Pay [recipient Account] 10.25 USD worth of [the gold-linked Currency].
- the system may then present the prospective payer with a preview displaying the actual quantity of the Settlement Currency, rendered in the unit of Account native to that Currency, to be conveyed.
- This Spend Preview may also display the Reference Exchange Rate used to perform the calculation.
- numeraire which can be readily calculated from prices or exchange rates that are directly available.
- numeraires may be baskets or indexed combinations of conventional Currencies and/or prices of specified commodities and/or indexes that are themselves calculated from such combinations.
- Reference Exchange Rate The System may maintain Reference Exchange Rates to support use of differing Numeraires as a convenience for Members, without warranty as to their correlation to any actual currency exchange rates available in exchange markets.
- the System via these Reference Exchange Rates, may also enable display of an approximate equivalent value of balances rendered using Numeraires that differ from that of the Settlement Currency.
- Exchange Rates may preferably draw exchange rate data from one or more Exchange Providers or Depository Institutions that actually make a market for currency exchange involving Currencies the Base Moneys of which circulate within the system.
- the system may apply statistical analytical processes to exclude possibly erroneous quotes and/or to smooth, average, or weight exchange rates quotations determined likely to be valid.
- a participant with Privileges required to Authorize a Spend may be either an Account User on the paying Account or an administrative user acting in the context of an Administrative Override Spend.
- a Spend must be Authorized prior to its execution. Such advance Authorization may be for a Spend Instruction specifying immediate execution or may be a pre- Authorization for a Spend Instruction specifying execution in the future.
- Account Module display name, as provided below, to the counterparty of a Spend.
- RTGS Real Time Gross Settlement
- a Spend with the single exception of an Issuance Spend, conforms to a Strict Debit Rule, enforcing that a Spend Instruction specifying a Spend Amount that is greater than the Available Balance in the paying Account will not be executed, thereby precluding payment failure or reversal due to an insufficient amount of money in the payer's Account.
- Non-repudiation an effort to seek reversal of a Spend because the payer has changed his mind, may be proscribed by contractual agreement.
- An Account Agreement which must be accepted as a condition of Account creation, ownership or usage, may provide that an attempt on the part of a payer to repudiate a Spend that was neither Unauthorized nor Erroneous via the Disputed Spend mechanism (see below) may result in Account closure and expulsion from the System.
- System investigatory discretion System may reserve full discretion to determine if a Disputed Spend claim is valid and what measures, if any, may be undertaken to mitigate payer loss.
- Actions of a recipient deemed as constituting an attempt to wrongfully profit from a Disputed Spend may be grounds for Account closure, expulsion from the System and/or legal action.
- System may decline to take actions to mitigate payer loss due a Disputed Spend that it deems may result in harm to an innocent third party.
- a party may be the primary or downstream recipient of an erroneous transfer or the unknowing downstream recipient of value diverted by an unauthorized (fraudulent) transfer.
- System administrative or investigatory staff may also have interfaces facilitating designation of a Spend as Disputed including, in appropriate circumstances, subsequent or downstream Spends.
- Hold. System may implement methods to place a Hold on direct or downstream recipient Accounts or SubAccounts to stabilize value pursuant to a Disputed Spend investigation.
- Assisted recipient return Systems may be implemented to assist the direct or downstream recipient of a Disputed Spend with a convenient interface to facilitate a voluntary Spend of value back to the original payer in an amount automatically adjusted as to be net of any fees that may have subsequently diminished the corpus of the disputed value.
- Administrative override Spend Systems may be implemented to enable System Provider to initiate an Administrative Override Spend for the recovery and return of value from a direct or downstream recipient Account deemed to contain proceeds of an unauthorized or erroneous Spend. An Administrative Override Spend may also be performed by System Provider in connection with closing an Account.
- Mass Spend Systems may provide for Mass Spends.
- Pre-authorized Spend Systems may provide for pre-authorized Spends in which the Spend Instruction specifies conditions for non-immediate, that is, future execution. With such Spends, the Spend Instruction would specify the paying and recipient Account but may specify a range of options for other parameters such as but not limited to Spend Amount, time window of execution, whether to try again (along with when and how many times) if the Spend cannot be completed due to insufficient Balance in the paying Account at the time of attempted execution, and scope of authority for recipient in terms of specifying Spend Amount, memo, and timing of execution.
- the pre-authorized Spend Instruction process may also allow for amendment or cancellation of the instruction by the payer at any time prior to execution of the Spend.
- Bill presentment Systems may provide for a bill presentment process in which a prospective recipient may specify parameters for a Spend that the system then securely transmits to the prospective payer's computing device such a mobile phone enabling streamlined authorization that may entail as little as a single click signifying approval.
- the system may provide a system enabling a prospective recipient to conveniently generate a QR code encoding parameters of a Spend Instruction formatted into a GET request, enabling the prospective recipient to directly display the QR code to the prospective payer.
- Issuance, Distribution, Redemption and De-Issuance Spends See description below of Bailment/Issuance and Redemption/De-Issuance processes. 124. Account.
- the system provides for the creation, use and closing of Accounts that, with the sole exception of (a) Mint Account(s), are asset accounts comprised of one or more Currency-specific Sub Accounts that may contain Balances of Base Moneys belonging to the Owner(s) of that Account.
- the system may support jurisdictional granularity such that a Person may become a Member but may not be extended Permissions necessary to create, own or use any Account if, for example, they reside in a jurisdiction that does not permit use the system's payment capabilities.
- Account ID may be a System generated alphanumeric string used to uniquely identify an Account.
- the unique Account identifier may be a lengthy string thereby affording a vast namespace, thereby reducing the risk that an error in specifying an Account, particularly in the
- the unique Account identifier may be comprised of a structured concatenation of strings, each component string representing either a unique identifier of a business object related to the Account, the value of an attribute of either the Account or one or more of the associated objects, or, a checksum.
- Component strings themselves may also be structured concatenations of component strings. For example, a portion of the string uniquely identifying an Account may be the unique Identifier of the Account Module of which the Account is a member.
- the unique identifier of the Account Module in turn may contain a component string serving as a foreign key uniquely identifying the Account Module Owner or Account Module Owner group, which string may contain a component identifying the country of the Account Module Owner.
- Another domain of the string uniquely identifying the Account may be a component string indicating the Account Type.
- Such use of a structured concatenation of strings may enable certain business rules to be evaluated and enforced within the client application, reducing network traffic and economizing on server side computational resources.
- Such business rules may be as simple as a checksum error indicating an invalid Account ID or more sophisticated such as determination as to whether the paying and recipient Accounts specified in a Spend Instruction are respectively eligible to pay to or receive from each other.
- Condensed string expression A lengthy Account ID string may be translated into a condensed expression enabling its representation with a shorter more wieldy string. For example, a lengthy string comprised of base 10 decimal numerals may be translated into a much shorter base 62 expression affording greater convenience for User display and data entry purposes.
- System may associate User-submitted display names with Accounts and Account Modules. Association of a display name with an Account may be useful for an Account User with permissions on multiple Accounts to distinguish one Account from another.
- An Account Module display name in turn may be exposed to the counterparty of a Spend enabling Account Users on both the paying and recipient Accounts to recognize their respective counterparties.
- the Account Module display name of a designated recipient Account may for example be displayed to the prospective payer at the time a Spend Instruction is specified.
- the Account Module display name of the counterparty may also be displayed to both payer and payee in reports of previously settled Spends.
- a User- proposed Account Module display name may be reviewed during the initial Customer Service review of CDD to assure the selected label would not be damaging to the reputation of the System or indicative of possible criminal intent on the part of the Account User.
- a User-proposed change of an Account Module display name preferably prompts re-review.
- the system may allow for automated default system approval of an Account Module display name that matches or only contains components of the Legal Name of an Owner of the Account Module.
- the system may, however, require administrative review and approval for an Account Module display name that does not match or only contain components of the Legal Name of an Owner of the Account Module.
- 124.1.3. Letter of Authorization Systems may provide for use of a letter of authorization by which a Person grants authority to a Member who is a User to serve as Proxy for that Person. Systems may provide for generation of letters of authorization assuring explicit specification of all required parameters
- Subaccount Accounts may contain one or more SubAccounts.
- a User on the Account with requisite Permissions may specify which Base Moneys the Account may contain, thereby specifying which SubAccounts are activated.
- Hold The system may provide for placing and removing a Hold on one or more Account or SubAccount.
- a blocked Account may not receive Spends but Spends may be made from it.
- a frozen Account may not receive Spends nor may Spends be made from it except by System Provider performing an Administrative Override Spend.
- An Account may be designated as open by court order.
- An example may be an Account that System Provider has determined should be closed due to suspicion of illicit activity but is left open for monitoring purposes pursuant to court order.
- a closed Account may be blocked or frozen depending on whether closed voluntarily by a User acting on behalf the Account Owner(s) or by System Provider. Closed status may primarily determine how User options pertaining to that Account are displayed to the User. Account closure may not result in deletion of Account records.
- Each Base Money issued and circulating via the disclosed system is the Base Money of a distinct Currency rather than representing Broad Money denominated or payable in any existing government-issued Currency.
- Base Money of which is issued and circulates via the system may require a unique name and/or Currency code that serves to distinguish it from existing Currencies and may require protection as intellectual property after the fashion of a brand name.
- the Base Moneys issued and circulating via the disclosed system may be categorized into two groups.
- the core group may be of primary significance with respect to achieving the macroeconomic benefits of a self-adjusting money supply that, upon emergence, may serve as an external constraint enabling governments to adhere to sustainable fiscal policies.
- Each Currency in this core group mobilizes the value of a particular physical commodity.
- the primary and obligatory Currency in this group is linked to and backed by gold.
- Other Currencies in this core group may mobilize the value of other commodities such as silver, platinum, palladium, rhodium or titanium. 125.4.1. Underlying assets
- Base Moneys in the core group is held in Bailment for the sole benefit of Holders of that Base Money and may not be loaned, hypothecated or otherwise encumbered for any purpose.
- the Bailee for commodities held as reserves backing Base Moneys in the core group may be a trust.
- This trust may be a special purpose trust.
- Precious metal bullion reserves held as backing for the Base Moneys in the core group may be stored in the repositories used by international gold banks and government central banks for storing their bullion.
- the dispersion of reserves across multiple repositories located in different jurisdictions may mitigate risk of loss due to compromise of any particular facility whether from physical disaster, criminal activity or political/military gambit.
- the Monetary Liabilities constituting the core group of Base Moneys in the system and deriving their value from assets held in Bailment are in the nature of a Bailment that, by virtue of crossing the balance sheet of the Issuer, may be rendered and expressed using numbers, thereby becoming fungible, divisible by means of arithmetic calculation and readily transferable by book entry in an accounting system.
- Unit of account The native unit of account for describing or
- the Base Money of which is in this core group may be grams (and decimal fractions of grams).
- troy ounces (and decimal fraction) may also be used as a unit of account since there is a fixed standard arithmetic ratio between these two units in their conventional usage as units of weight, one troy ounce being equivalent to 31.1034768 grams.
- Usage of these terms as units of account for Monetary Liabilities may serve to highlight the 100% reserve requirement that dictates that for every gram of a bullion- linked Base Money in circulation in the system there must be at least one gram (fine content) of the corresponding bullion backing it.
- Base Moneys in the core group may derive a high degree of freedom from default risk from their requirement of a 100% reserve of the matching physical commodity along with safeguards to mitigate risks relating to the integrity and physical security of such reserves.
- a secondary group of Currencies may play a
- a Base Money in the secondary group may be anchored to a single specified government issued Currency.
- a Base Money in the secondary group may be anchored to a basket of two or more anchor Currencies or a calculated index combining various specified government issued Currencies and/or commodities in a fixed ratio of components.
- Base Moneys of the secondary group are Monetary Liabilities denominated in a unit of account distinct to that Currency as declared by its Issuer.
- European Parliament or a government currency board that may elect to matriculate to the system as an Issuer, may not be loaned into existence, that is, they may not be Issued as a granting of credit but rather must be Issued in exchange for funds received at par value as set forth in their respective Declaration.
- the Issuer of Base Money of the secondary group in its Declaration of Liability must specify the Outside Money(s) or other standard(s) of value to which its liabilities are anchored and the precise ratio or ratios to be maintained. For example, one Issuer may simply specify that it is obliged to redeem its Base Money on demand at a fixed ratio of one US dollar for one unit.
- a more complex example might be an Issuer specifying an obligation to maintain parity of its unit to the Special Drawing Right (SDR) defined by the International Monetary Fund and to perform its redemption obligations in one or more of the component Currencies at the exchange rate in effect as of the day of Redemption as published by the IMF.
- SDR Special Drawing Right
- the assets that may be held against Base Moneys in the secondary group may include financial instruments including but not limited to government securities, bank deposits, futures contracts, commercial paper and collateralized repurchase agreements.
- the Issuer of Base Moneys in the secondary group may be bound by contract with the System Provider to publish in its Issuer's Declaration of Liability specific details regarding not only the categories of assets that may be held but also the maximum maturity for each asset type.
- the Issuer may be further bound by contract to provide advance notice to every holder of its Base Money of any prospective change in the asset classes to be held or their maximum maturity.
- Issuance/De-Issuance. System may enable one or more Issuers to Issue and De-
- Issuer. System may provide for one or more entities to be assigned
- the Issuer is responsible for the subsidiary Roles of Mint and Comptroller
- Mint The Person assigned the Mint Role exercises control over a Mint Account.
- 125.6.1.1.1 Delegation to a Mint Fiduciary.
- the Issuer may delegate performance of the Mint Role to a third party Mint Fiduciary.
- Such delegation may enhance system security and integrity through greater separation of Roles and/or may enhance system reputation if the Mint Fiduciary is widely recognized as highly reputable.
- Primary dealer. System may provide for one or more entities to be assigned capabilities and responsibilities to perform the Role of Primary Dealer.
- Open Market Operations. System may provide for the conduct of Open Market Operations.
- a Primary Dealer may initiate the process that culminates in De-Issuance and release of specified bullion bar(s) by means of a Redemption Spend in conformity with the applicable Issuer's Declaration of Liability and business rules of the system.
- Figure 7 shows a system 700 by which new quantities of the gold-linked Base Money may be created and distributed into circulation on/within the Settlement Platform.
- the process begins external to the Settlement Platform 708 when Primary Dealer 701 makes a Bailment 702 of gold bullion 703 to the allocated storage holdings 704 of the Trust which serve as reserves.
- the Repository 705 Upon receipt of the bullion, the Repository 705 sends notification 706 to the Issuer 707.
- Assets having been secured, issuance of new Base Money of the gold- linked Monetary Liabilities may proceed within the closed universe of Settlement Platform 708.
- an Issuance Spend 710 is made from Mint Account 709 to Comptroller Account 711.
- a Distribution Spend 712 is then made to Account 713 of the Primary Dealer 701 that had bailed in bullion 703.
- De-issuance Spend 805 is then made from Comptroller Account 804 to Mint Account 806 resulting in a decrease in the amount of the gold-linked Base Money in circulation. Monetary Liabilities having decreased, a corresponding quantity of gold bullion may be released from reserves.
- Issuer 807 sends Delivery Order 808 to Repository 809 specifying a particular bar or bars of gold bullion 812 to release from the holdings of Trust 810.
- Delivery Order 808 to Repository 809 specifying a particular bar or bars of gold bullion 812 to release from the holdings of Trust 810.
- Delivery Order 808 must also be authorized by Escrow Agent (not shown). Upon successful authentication of Delivery Order 808, Repository 809 makes Delivery 811 of gold bullion 812 in accordance with instructions of Primary Dealer 813.
- the system may implement a Reserves Store.
- Figure 1 shows an exemplary system logical architecture according to one embodiment. In this exemplary implementation, principles of
- CQRS Command Query Responsibility Separation
- system 100 includes one or more server/computing devices at Primary Site 103, operative ly coupled over network 102 to one or more Client Computing Devices 101 (e.g., 101-1 through 101-n) and to one or more databases maintained on one or more server/computing devices comprising Master Data Servers 110, which could located either at Primary Site 103 or at a separate site (not shown), and Backup Master Data Servers 112 at one or more Backup Sites 111.
- Front- end Servers 105 such as Web Servers 106 and Public API Servers 107, direct Read Operations to Read-only Data Servers 109.
- Application Servers 108 similarly direct Read Operations to Read-only Data Servers 109.
- Write Operations in contrast, are directed to Master Data Servers and are backed up to Backup Master Database Servers. Two options for such backup are depicted.
- First Option 113 data written to Master Data Servers is replicated and/or mirrored to Backup Master Data Servers 112.
- Option 114 concurrent with Write Operations to Master Data Servers, data is also directly written to Backup Master Data Servers via Secondary Write Operations.
- Network 102 represents, for example, any combination of the Internet, local area network(s) such as an intranet, wide area network(s), and/or so on. Such networking environments are commonplace in offices, enterprise-wide computer networks, etc.
- Client computing devices 101 which may include at least one processor, represent a set of arbitrary computing devices executing application(s) that send data inputs to and/or receive data outputs from one or more server/computing devices deployed as Load Balancers / Client-facing cache 104.
- Such Client Computing devices include, for example, one or more of desktop computers, laptops, mobile computing devices (e.g., smart phones, tablet computers, or PDAs), server computers, and/or so on.
- Master and/or Backup Data Servers publish data written to them to Read-only Data Servers which may in turn refresh data cached on more forward server devices or even in cache on Client Computing Devices such as, for example, secure caching capabilities provided with certain modern Web browsers or smart phones.
- Embodiments of the present invention may be web-based.
- Service-oriented architecture (SOA).
- SOA Service-oriented architecture
- Such embodiments would entail implementations of services, each serving as unassociated, loosely coupled units of functionality that do not embed calls to other services in their source code. Coordinated use of such services may be orchestrated by means of messages brokered by specialized software such as a service bus.
- CQRS Command Query Responsibility Segregation
- Event sourcing Systems may apply event sourcing to trigger state changes and orchestrate services.
- Relational database Systems may incorporate relational databases as a persistence solution for data requiring referential integrity such as a ledger of account balances.
- Main memory database system Systems may make use of main memory database systems in implementations that assure high availability through replication and automated failover. Such systems may for example enable persistence of a partially completed form enabling a User to pick up where they left off if interrupted while completing an application or configuring a complex instruction.
- 126.1.3.4 Distributed (cloud) computing. Systems may be configured to exploit technologies for distributed (cloud) computing. Such systems may implement software delivery models such as Software as a service (SaaS), Platform as a service (PaaS, and/or Infrastructure as a service IaaS). Implementation of system architectures integrating such delivery models may facilitate scalability and afford efficiencies in deploying system upgrades and enhancements. 126.2. Multi-platform client support. Systems may be implemented in a fashion to facilitate porting to multiple diverse client side computing platforms including but not limited to web browsers on personal, laptop or tablet computers and smart phones with capability to run "apps".
- SaaS Software as a service
- PaaS Platform as a service
- IaaS Infrastructure as a service
- Implementation of system architectures integrating such delivery models may facilitate scalability and afford efficiencies in deploying system upgrades and enhancements.
- 126.2. Multi-platform client support Systems may be implemented in a fashion to facilitate porting to multiple diverse client side computing platforms including but not limited to web browsers on
- the system may be implemented with multiple layers of safeguards to assure data integrity and prevent loss or compromise of data.
- safeguards may include automated systems that function in the client-side computing device via JavaScript or other client-side technologies to enforce validation rules that prevent submission of data that does not comply with business rules. Additional safeguards may come into play at multiple layers including but not limited to the application layer and data persistence systems such as primary and back-up databases.
- Figure 3 shows an exemplary progression of status from Applicant 301 to Member 302 and to Account Owner 303.
- Customer Identification 304 review and approval is required for Applicant 301 to become Member 302.
- Applicant 301 must also accept terms of Membership Agreement 306 and, in certain embodiments, Referral Agreement 307 governing a Referral Incentive Program for existing Members who/that refer new prospective Members.
- Referral Agreement 307 governing a Referral Incentive Program for existing Members who/that refer new prospective Members.
- Additional Due Diligence 305 must be successfully completed and Member 302, directly or via a Proxy authorized to act on prospective Account Owner's behalf, must accept terms of Account Agreement 308.
- An Account User (not shown), acting on authority of prospective Account Owner 303, must also agree to Issuer's Declaration of Liability 309 offered by the Issuer of any Base Money that Account Owner 303 intends to Hold. 128.1. No need for established/approved credit. Since a Spend is implemented as to be immune to the risk of payer default the system may not need to impose any credit- related prerequisite for Membership or Account Ownership. The system may therefore be made available to Persons without established credit and/or who may be unbanked. 128.2. Identified counterparty, Systems may assure that any prospective
- Structured conduct and recording of remote video and audio interview site inspection of a business via a telephonic device may be performed, such as with a smart phone or other mobile device, to corroborate and augment conventional verification and documentation of the existence and activities of a business customer.
- Figure 2a shows an exemplary organization of entities for one possible embodiment in which a Membership Organization 201 is the licensee under IP License 205 for intellectual property owned by separate and independent Intellectual Property Owner 204.
- Membership Organization 201 is the parent company of both System Provider 202 and Issuer 203 and IP License 205 grants use of intellectual property enabling performance of both Roles.
- Right Holders 206- 1-n provide capital 207 to Membership Organization 201 and are respectively granted Rights 208- 1-n.
- Figure 2b shows an alternative exemplary organization of entities for one possible embodiment in which Issuers 203 -c-n are separate and independent of Membership
- IP License 205 -b provides for performance of the System Provider Role while IP Licenses 205-c-n each enable conduct of the Issuer Role.
- System Provider 202-b may be one and the same as, or organized as a division of Membership Organization 201-b.
- Circulation Agreements 209-c-n are contracts between System Provider 202-b and each
- Issuer 203 -c-n governing arrangements whereby Base Moneys may be issued and circulate via the Settlement Platform provided and administered by System Provider 202-b.
- Capital 207 provided by Right Holders 206- 1-n is provided to Membership Organization 201-b.
- Issuers 203 -c-n in contrast, must provide for their own capitalization. 129.1.
- Membership Organization The Membership Organization and the entity acting as System Provider, which may be one and the same, may eschew a conventional equity ownership model as exists for example with a company that issues stock and is owned by shareholders.
- Roles Embodiments of the present invention may include Roles. Separation of roles may enable superior governance, protecting System integrity. This may be useful regarding elimination of the risk of malfeasance, error or external coercion leading to deviation from defined Currency obligations. Distinct Roles may also mirror patterns empirically discovered in decades and centuries of the practices of money and banking as conducive to efficiency and orderly markets.
- Core Roles may be those required for Issuance, initial Distribution, Redemption and De-Issuance of the Base Moneys that circulate within the System.
- System Provider may provide systems
- Provider responsibilities may include providing a means for the enrollment, credentialing and maintenance of Members.
- Provider responsibilities may include providing a means for creation and provisioning of Accounts for eligible Members and enabling the conduct of Spends.
- responsibilities may include collection and distribution of revenues.
- Issuer The system requires at least one Issuer but may support multiple Issuers. Issuers may be private sector firms, government bodies, or both. In preferred embodiments the System Provider does not serve as Issuer although both may share a common parent. An Issuer may be a completely separate firm from that of the System Provider.
- the system may provide separate systems whereby the Issuer may administer information systems and operations involving assets that serve to back such liabilities.
- Escrow Agent Issuers may be contractually bound and systems provided to assure that the authorization of a third party escrow agent must be obtained as a condition of release of any assets held as backing against their Monetary Liabilities.
- a major element in selecting gold as the underlying asset for the primary Base Money may be that an extensive well-conceived and cost effective infrastructure exists, supporting wholesale physical gold market operations and custodial arrangements.
- the physical reserves held against the Base Moneys in the core group may be in the form of Good Delivery bullion bars of the
- the System Provider may impose the requirement that a Primary Dealer must be a Member and Financial Institution, offering exchange services as either an Exchange provider or a Depository Institution.
- the System Provider may impose a credentialing process to assure that any prospective Primary Dealer has the resources and capability to honor all obligations attendant to that Role.
- a Primary Dealer must make an orderly market for exchange for one or more of the Base Moneys that circulate within the system.
- OMO open market operations
- the disclosed Primary Dealer arrangement may offer additional benefits relative to a less restricted system such as one that would afford all or a broader cohort of End Users permissions to Bail and Redeem.
- OMO involving the secondary group entails payment of funds from the Primary Dealer to the Issuer, the risk of payment failure or reversal from a Primary Dealer may be greatly reduced from that of directly accepting payment from some other counterparty.
- the grant of privileges enabling OMO may be contractually linked to obligations assuring provision of an orderly market. 130.1.1.1.3.4.3. Compliance with Repository requirements. Given that: a) participation in the bullion Bailment or delivery processes may require a Primary Dealer to either maintain allocated storage on its own account in the Repositories where bullion reserves are held, or have a dealing relationship with a bullion dealer that does, and, b) Repositories and wholesale bullion dealers impose a high standard of due diligence on their prospective customers, any bailment arrangement involving a broader cohort of the general public would be impracticable. 130.1.1.2. Required for emergence. Additional Roles may be critical for
- Financial Institutions Members that are Financial Institutions may fulfill Roles that entail offering Currency exchange services to other Members.
- Obligations incurred by an entity seeking to act as a Exchange Provider within the system may be memorialized in a contract such as a Supplemental
- the technical protocol may require an Exchange Provider not to accept a funding payment from any party or source other than their exchange customer for any currency exchange transaction for which the funding or fulfillment payment is by means of a Spend.
- the technical protocol may require an Exchange Provider to provide System Provider with information regarding external accounts used by their exchange customers as a source or destination of funds used to fund or sent in fulfillment of currency exchanges. Access to such information may enable System Provider to discover otherwise hidden connections between seemingly unrelated Accounts including the possibility of detecting indices of undisclosed common ownership or control.
- Depository Institution Systems may provide for participating Financial Institutions to fulfill the Role of Depository Institution.
- Obligations incurred by an entity seeking to act as a Depository Institution within the system may be memorialized in a contract such as a Supplemental Agreement for Depository Institutions as further detailed herein.
- System Provider may require a Depository Institution to abide by trademarks and consistent-use-of-terminology specifications of System Provider and of any Issuer the Base Money of which may serve as reserves/redemption medium underlying that Depository Institution's own BMP Account liabilities.
- System Provider may require a Depository Institution to implement mechanisms enabling a BMP Account Funding Spend to be promptly credited as to properly increment the balance of the applicable BMP Account.
- FIG 11 shows a system 1100 whereby BMP Account Funding Spend 1103 creates an accounts payable liability on the part of the Bank to make an appropriate credit to their customer's BMP Account.
- Display 1101 displays a particular customer's balances of USD and of system- Issuer Currency XXX and corresponding states of the bank's simplified balance sheet 1102 Prior to the BMP Account Funding Spend comprising event 1103, customer balance display 1101-1 shows balances of 1,000 USD (a conventional deposit) and a zero balance of XXX, the denomination for this particular BMP Account.
- the bank's simplified balance sheet in this state 1102-1 shows a deposit liability of 1,000 USD offset by 1000 USD of assets.
- event 1103 the customer makes a BMP Account Funding Spend in the amount of 2.0 XXX from customer's Account with the system to bank's designated Account with the system and a Spend Fee of 0.02 XXX is deducted from the recipient Account (i.e., the bank's).
- the corresponding balance sheet shows the net 1.98 XXX of new assets and incurs an accounts payable liability of 1.98 XXX.
- Event 1104 occurs entirely on the books of the bank.
- Customer interface 1101-3 shows 1.98 XXX posted to the customer's BMP Account.
- Balance sheet 1102-3 shows the account payable to have been satisfied, the liability having now been posted as 1.98 XXX of XXX- denominated BMP Account liabilities.
- the Depository Institution may also be required to implement mechanisms for prompt initiation of a
- the technical protocol may require a Depository Institution to implement measures by which each of their customers designates and demonstrates requisite control or ownership of a Linked Customer Account Module. Alternatively, this requirement may be met by means of System Provider identifying a Linked Customer Account Module as a component of data provided to its relying party in the course of federated log-in.
- IP Owner In a preferred embodiment, the provision of separate ownership of the underlying intellectual property and a licensing arrangement whereby such IP may be provided to the System Provider and/or Issuers enables an additional check and balance tending to mitigate the risk of a System Provider or Issuer deviating from founding principles.
- a Right Holder may be a Member that, in exchange for initial capital enabling establishment, launch and/or enhancement of the System, receives a continuing and transferable right to a specified portion of gross revenues generated by the System. The benefit due to a Right Holder may be partially determined by actions undertaken by that Right Holder to attract new Members to the System.
- End User The default Role for Members may be End User; this is for economic actors comprising the general public such as individuals, companies or government bodies that become Members but play no institutional Role relating to administering the system.
- Figure 5 shows a system of classification of Persons and subsets of Persons 500 consists of Legal Persons 501 and Human Beings 502. All Users 503 are Human Beings 502. Applicants 504, Members 505 and Account Owners 506 may be either Human Beings 502 or Legal Persons 501 and an Account Owner 506 must be a Member 505.
- An Account User 507 must be a Member 505 and a User 503 and may or may not be an Account Owner 506, a Proxy 508 or a Root User 509.
- a Root User 509 must be an Account User 507.
- a Proxy 508 must be a Member 505 and a User 503 and may or may not be an Account Owner 506, an Account User 507 or a Root User 509.
- a status of a Person Systems may assign a status to each Person on record in the system which may be updated/modified and a record of all previous statuses and amendments maintained.
- An example of such status may be a Person banned from system participation because of previous misuse of the system that led to expulsion.
- Another example may a Legal Person such as corporation that has been dissolved.
- a status may be a composite of multiple axes.
- Permissions to Users Such systems may be hierarchical in the sense that certain Permissions may invest a User with Privileges enabling the extension (or revocation) of specified Permissions to other Users.
- 131.6.1. Status of a Member Systems may assign a status to each Member on record in the system which may be updated/modified and a record of all previous statuses and amendments maintained. An example of such status lineage may be a Member who had resigned his Membership and who later requested and was granted reinstatement. 131.7. Proxy. Systems may provide for designation of a Proxy and for the transfer or discontinuation of Proxy authority.
- Account Owner Subj ect to due diligence performed by the System Provider, a Member in good standing and residing in a jurisdiction where participation in the payment system is permitted may own one or more Accounts, solely or jointly with other
- Account User A Member who is a User may be assigned Permissions as an Account User on one or more Accounts owned by himself or by (an)other Member(s). There may be multiple Users on an Account.
- Root User The system may require a Root User on each Account. At the time of Account creation the Root User may hold a full set of Permissions regarding that Account including the Privilege to appoint other Account Users and assign their Permissions.
- CIP may entail User submission of original or facsimile images of documents substantiating identity and place of residence.
- Examples of an identity document may include a current government-issued identification card bearing a photograph such as a passport or driver license.
- a document demonstrating place of residence may be a copy of a utility bill.
- System provider personnel may evaluate submitted documents and make a determination that they are authentic and unaltered.
- Non-documentary verification Another verification technique may entail submitting a set of User-provided identifiers such as name, date of birth, government ID number and address to a commercial service that can determine how well they match known data on record. Verification that the instant User is the actual human being whose identifiers that User has submitted may be achieved by means of a question and answer product offered by a commercial identity
- CIP may be extended to include collection of and authentication of identity using biometric identifiers.
- Such compliance measures may include processes to screen both Applicants and existing Members to detect Persons who may be on the OF AC list of Specially Designated Nationals or who may be subject to other OF AC sanctions.
- the interface alone would implement the saga enabling the file to be persisted and associated with data identifying the date/time of interview, identity of interviewer and identity of both the human being and the business subject of the interview.
- the system may affix a digital signature to the file using a private key inaccessible to administrative personnel such as interviewers.
- Structured elements Capture of certain structured elements may be included in the basic script of all such video call remote inspections. These elements may include the human interviewee stating his or her name and turning the camera as to capture his or her own facial image. The interview may begin at the exterior entry point of the business premises, capturing any signage on nearby buildings and streets and a panoramic sweep of the exterior and neighboring structures. If the call drops at any time, additional calls may be initiated, as many as necessary. The interior of the business premises should be inspected with emphasis on areas where business activities characteristic of the business occur.
- Ad hoc or discretionary elements The interviewer may instruct the interviewee to capture additional footage and/or other data as might be judged useful by the interviewer. For example, with exterior footage, the interviewer may direct the interviewee to direct the camera to license plates in the parking lot and, if the licenses correlate poorly with the stated location of the business, ask the interviewee why the discrepancy exists. During the interior inspection, the interviewer may notice inbound postal mail and ask the interviewee to direct the camera as to show the address. To facilitate cooperation with these ad hoc elements, the interviewer may be trained in techniques to establish a degree of rapport between interviewer and
- establishment of a more lighthearted demeanor may facilitate capture of additional data such as coworkers who voluntarily want to be seen in the footage.
- CDD A universal prerequisite to Account Ownership is successful completion of processes for establishing, documenting and verifying the anticipated usage of an Account as well as an Account Owner's source of funds in order to aid in subsequent prevention, detection, interdiction and/or reporting of possible suspicious activity on the part of a customer or customers. These processes may be styled Customer Due Diligence or CDD. 131.11.1. Anticipated usage. Systems may be implemented for both individual and business Accounts for gathering and evaluating User-submitted data regarding anticipated usage. Universal parameters of anticipated usage may include an estimated range of the number of counterparties from whom Spends will be received and to whom Spends will be made, in addition to whether such counterparties may be domestic or international.
- a User may also be asked to estimate the quantity of value that may flow through an Account over a specified interval of time such as a typical month. For example, in the provisioning of a personal Account an anticipated usage that entails routinely making or receiving Spends to/from more than 100 counterparties may indicate an intention to use the Account for business purposes.
- Systems may be implemented for both individual and business Accounts for gathering and evaluating User-submitted data regarding source and nature of income.
- systems may gather information regarding employment since that is the most common source of income for most people. For example, an unemployed student proposing to routinely receive large flows of value into a personal Account may warrant further evaluation to distinguish the wealthy beneficiary of a trust fund from a person involved in money laundering activities.
- Systems for evaluating the nature of a business may require gathering more extensive data regarding the particular business model. For example a manufacturing business that does not engage in retail sales to consumers but rather expects to receive occasional large business-to-business Spends would need to be distinguished from a professional practice that might similarly receive intermittent Spends in irregular amounts.
- EDD System usage by certain categories of individuals or business enterprises may constitute a heightened risk for money laundering or other abuses of the system.
- Systems of enhanced due diligence may be implemented to gather and assess additional information regarding sources of income or particulars of the business model of such individuals or organizations. In the case of a high risk business, such as an Exchange Provider, these risks may arise not from ill intent on the part of the Member subject to EDD but rather from unwitting facilitation of abuses by customers of that Member.
- the process of EDD may be implemented in conjunction with specialized supplemental contracts between System Provider and Members subject to EDD specific to the risk profile and category of business activities of the Member. EDD may also be coordinated with assistance such as the use of specialized templates in Account Module provisioning.
- EDD may also integrate into rules-based Transaction Monitoring systems.
- a rule may entail monitoring Spends to or from Exchange Providers to detect Members obtaining a Balance of one of the Base Moneys via currency exchange only to dispose of it shortly afterward via currency exchange with another Exchange Provider.
- Examples of EDD combined with specialized contracts and Account Module provisioning are detailed in the description of systems for Financial Institutions that matriculate to the system.
- the system may govern all system interactions according to a Permissions model. Systems may afford mechanisms for assigning, modifying and operating in accordance with Permissions such that at any given time the system may
- the system may include sub-systems enabling integration of business rules.
- the implementation may entail use of a rules engine permitting systematic integration of new rules, capabilities for rapid marshaling of all rules applicable to a particular system interaction, and mechanisms for assuring compliance with all applicable rules.
- Internal controls The system may embody internal controls assuring compliance with business rules relating to system integrity. Internal controls may entail defined processes such as procedures for manual tasks. Some internal controls may operate automatically as for example an Issuance saga designed to eliminate possibilities of error, malfeasance or coercion that could result in breach of an Issuer's Declaration of Liability such as over-Issue leading to un-backed Monetary Liabilities.
- the system may implement systems to dynamically provision the User interface of each particular User for each logged-in session upon successful presentation and authentication of log-in credentials with capabilities specific to that User's Privileges and assignment of Role responsibilities.
- This dynamic provisioning of interfaces on a User-specific, session-specific basis may serve to enhance security by precluding exercise of permissions reserved for other User/Roles.
- certain web-based legacy systems may control access to backend or sensitive administrative functions by means of static webpages at URLs that may be secured by Username /password and possible implementation of digital certificates. Such URLs may become natural targets of hackers seeking to penetrate a system and gain access to functionality controlled via such webpages.
- the system may include a prescribed canon of contracts memorializing privileges and obligations enabling the various Members incumbent to each of the various Roles to interact with the system and each other as to assure consistent conformity to system logic.
- the System Provider may have primary responsibility to assure execution of contracts and to monitor the performance of contractual counterparties.
- the IP Owner may bear primary responsibility for assuring the execution and performance of the IP License Agreement.
- a Membership Agreement may be provided specifying universal terms and conditions governing participation in the system.
- Issuer' s Declaration of Liability Both general and more differentiated forms of an Issuer's Declaration of Liability may be provided specifying terms and conditions defining and governing the Monetary Liabilities of any Member undertaking to act as an Issuer via the system.
- a contract may be provided governing the rights and obligations of any Member undertaking to act as a Primary Dealer.
- the system may decline to implement any revenue model that entails levying a Membership fee or imposing any other sort of charge or fee that might require the System Provider to accept payments or transfers of value in any form from the general public or Members via existing payment systems that rely on banks. This is not an obligatory element and certain embodiments may involve assessment and collection of membership fees.
- the System may generate revenue primarily by assessing two fees, collected by the System Provider.
- a Spend Fee may be deducted from the recipient Account of all Spends with the exception of: Issuance Spend, Redemption Spend, De- Issuance Spend or Spends between two Accounts in the same Account Module.
- An Account Maintenance Fee may be
- Comptroller Account may be exempt from this fee.
- Currencies in the secondary group may realize income from holdings of remunerative assets such as debt securities held against Monetary Liabilities.
- the system may implement a systematic schema for distribution of gross revenues between System Provider, Issuers and, in certain embodiments, Right Holders and/or the IP Owner.
- Permissions logic that, with regard to all User interactions invokes a set of User-specific Permissions specific to each logged-in Session of that User, systems may be
- Password complexity System may impose a complexity requirement for passwords, for example requiring a minimum length and a mixture of alpha and numeric characters.
- the system may support usage of hardware tokens such as a smart card based log-in device involving a cryptographically enabled micro-chip for an End User preferring such an option.
- Two (or more) factor authentication may impose systems for two or more factor authentication.
- An example might be a requirement for User entry of a PIN delivered by the system to the User's mobile phone via SMS message or a smart phone app.
- Biometric authentication System may implement capabilities for biometric authentication such as but not limited to a facial or iris recognition app for a smart phone or use of a hardware device for digital capture of fingerprints.
- Systems may be implemented to mitigate the risk that a rogue employee act as a confederate to someone seeking to exploit systems for recovery of access to gain unauthorized access to a User's Permission set.
- Access logging Systems may provide for automatic logging of all system accesses by customers or by backend administrative Users. Such logging may create an auditable record containing data fields including but not limited to identity of User, date and time of access, session information such as IP or identifiers specific to access device used, resources or systems accessed, nature of access (such as read-only vs. an interaction that changes the state of a system or object) and an association with the unique identifiers of any transactions conducted during the session by that User.
- session information such as IP or identifiers specific to access device used, resources or systems accessed, nature of access (such as read-only vs. an interaction that changes the state of a system or object) and an association with the unique identifiers of any transactions conducted during the session by that User.
- Systems may be secured by systems including but not limited to: hardware and software firewalls, internal or third party systems to defend against denial-of-service attacks, use of hardened co location facilities with redundant upstream internet access, backup power and systems for securing physical access.
- passwords may be stored in encrypted form using a one way hash function.
- the robustness of the hashing protocol may be enhanced by salting as a safeguard against dictionary attacks.
- the salt may be unique per-user-per-password and may be generated using a Cryptographically Secure Pseudo-Random Number Generator (CSPRNG).
- CSPRNG Cryptographically Secure Pseudo-Random Number Generator
- Federated Log-in The system may implement federated log-in capabilities and serve as a provider to approved relying parties. Provision of federated log-in services may enable relying parties to rely on the identity verification procedures universally required of Members. Such reliance may be used by relying parties, for example, as an age verification mechanism or as a means of assuring that a customer or other prospective transactional counterparty is resident in an approved jurisdiction.
- Session. System may persist data regarding each session between the
- Such session data may include but would not be limited to IP numbers, user-agent strings such as browser tags, geolocation data and cookies.
- the system may eschew a
- a revenue distribution model based on automatic distribution of gross revenues, as opposed to an equity model that concerns itself with distribution of profits, may afford improved ability to resist institutional drift or corrupting influences that could undermine the integrity of the system.
- pressure could be applied to an equity-based company in the form of a takeover bid in an effort to compel the system to accept government debt instruments as an alternative to physical gold. Stakeholders with a revenue entitlement but no voting control such as Right Holders or the IP Owner pose less risk of killing such a golden goose for the sake of near term expedience.
- Automated internal controls Systems may be provided to automate internal controls in order to decrease reliance on business processes that depend on human performance and compliance.
- identity of Members may incorporate logic for excluding duplicate/multiple enrollments.
- the system may implement this requirement (as well as articulate it in contracts and presentation materials) as a "One Person/One Member" rule.
- Such systems for excluding multiple enrollment, even if innocently undertaken—such as a User who has lost a password or access token and mistakenly applies for a new Membership rather than pursuing system-provided measures for recovering lost access— may facilitate measures to detect and foil attempts by proscribed Persons to obtain Membership.
- An example may be a Person who has been expelled from the system for suspicion of illicit activity who seeks to re-enroll using falsified and/ or stolen identifiers.
- Systems for transaction monitoring may include
- a personal Account previously observed to have minimal activity that then changes to a pattern of a) receiving an incoming Spend just within its inbound Throughput Limit, followed shortly afterward by b) distribution of the value via a relatively large number of small outbound Spends may suggest involvement in a Ponzi scheme and warrant greater attention to counterparty Accounts and their associated Owners/Users.
- Rule/pattern-based Systems for transaction monitoring may incorporate rule-based detection methods that monitor for patterns deemed to be associated with possible abuses. For example, an Account may be listed on Throughput Exception requests submitted by multiple prospective counterparties as the recipient or source of Spends classified as being gifts. Such a pattern may warrant further evaluation to determine if the Account is being used for different purposes than disclosed in CDD.
- System organization that entails a System Provider with ability to query Membership records in conjunction with monitoring transactional activity may afford greater capability of iteratively detecting both falsified identifiers and suspicious transaction patterns. For example, detection of transaction patterns suggestive of a possible Ponzi scheme may trigger re-evaluation of submitted identifiers associated with the suspect Accounts that reveals previously undisclosed linkages of ownership or control.
- forensic data may consist of data submitted by or otherwise gathered from a device or Person and any associated session data.
- the system may implement systems to channelize User interactions with the system to prevent a wide range of potential problems.
- To channelize means to narrow the range of system interactions available to a User so as to foster best practices on the part of Users and preclude numerous patterns of behavior that could, if permitted, lead to a larger volume of unauthorized or erroneous Spends or constitute illicit activities on the part of Users.
- the goal of channelization may be to reduce the risk of error on the part of the payer by making the system more "idiot proof, that is, by systematically identifying and limiting potential sources of error.
- Channelization is preventive and complementary to transaction monitoring, which necessarily focuses on detecting activities after the fact. Channelizing the range of possible system interactions may make deviations easier to detect by narrowing the channels of transaction flow to relatively homogenous streams in which deviations stand out as more glaring.
- System user interactions may be channelized to reduce risks of erroneous or unauthorized spends, to impede efforts to use the system for illicit purposes, and to more readily detect such abuses that slip through.
- System users that are businesses may be required to use a prescribed Account Module of multiple accounts of specialized types, such account types including: one or more accounts that can only receive spends from accounts not contained within their Account Module and can only make spends to one or more accounts within their Account Module, one or more accounts that can only make or receive spends to or from other accounts within their Account Module, and one or more accounts that can only receive spends from accounts within their Account Module and can make spends to accounts not contained within their Account Module.
- Certain accounts of the type that can only receive spends from accounts not contained within their Account Module may be further restricted as to only receive spends constituting revenue. Certain of the accounts that are restricted as to only receive revenue can only receive spends generated by shopping cart software associated with a particular Universal Resource Locator (URL).
- URL Universal Resource Locator
- Certain accounts of the type that can only receive spends from accounts not contained within their Account Module may be further restricted as to only receive spends from financial institutions, and, certain accounts of the type that can make spends to accounts not contained within their Account Module are further restricted as to only be able to make such external spends to financial institutions.
- 141.1 Enhance security of value. Channelization may enhance prospects for recovery of value in cases such as compromise of a User's log-in credentials that leads to an unauthorized Spend. For example, efforts of a hacker to exchange value stolen via such an unauthorized Spend for some form of Outside money may be severely impeded by controls that hinder unauthorized commercial provision of currency exchange services. 141.2. Prevent and detect illicit patterns of usage. Channelization may enable prevention of illicit activity and facilitate better detection of unusual activity that slips through.
- the system may implement systems to detect and sanction unauthorized entities providing financial services to Members such as currency exchange or holding customer value on account.
- Systems for Throughput Exceptions and Account Modules, detailed below, may contain elements facilitating detection of such unauthorized activities.
- EDD for Financial Institutions may include documentation of compliance with applicable government registration and licensing requirements.
- EDD for Financial Institutions may include detailed elucidation and documentation of the scope of services the institution proposes to provide via the system.
- an Exchange Provider may be required to enumerate: jurisdictions in which they would operate and in which their customers may be located, all payment mechanisms by which they would accept or make payments of conventional money from/to their customers and all websites via which business with their customers may be transacted.
- System Provider may assist and direct Financial Institutions in establishment and provisioning of their Account Modules. Elements of this provisioning may include but are not limited to assurance that the Financial Institution and/or the relevant Accounts of the Financial
- Federated Log-in Systems may provide federated log-in capabilities by means of which a Financial Institution may receive assertions regarding a Member logging into their system that may include but not be limited to identifying information and information regarding that Member's Accounts. For example, a Financial Institution may rely on assertions received via federated log-in to comply with rules/restrictions relating to Linked Customer Account Modules.
- An example may be transaction monitoring to detect structuring exploits distributed between multiple providers of exchange services and therefore possibly undetectable by the individual institutions.
- Participating Financial Institutions may be required to agree to and participate in information sharing arrangements with System Provider to facilitate detection, investigation, interdiction and/or reporting of potentially suspicious activities. When applicable, such information sharing may be conducted in accordance with section 314(b) of the USA PATRIOT Act and related FinCEN guidance.
- Systems may be provided for, and participating Financial Institutions may be required to cooperate with, expulsion of Members. Such expulsion may entail processes enabling System Provider to override control of any Accounts of the Member being expelled and to enter Currency Exchange orders on behalf of that Member as may be necessary for zeroing out any Account Balances. Systems may implement an assignment logic to determine which Financial Institution is tasked with performance of any particular forced Currency exchange.
- the system for updating Reference Exchange Rates may integrate an alerting mechanism such that an attempted update that would result in change of a published rate in excess of a preset percentage triggers an alert and does not execute the rate update order without manual confirmation by a System administrator.
- Instruction may lead to display of a Spend preview that includes any Reference Exchange Rate used in System calculation of Spend Amount, enhancing the likelihood of the User on the paying Account noticing the error and declining to commit the Spend.
- Account type System channelization rules that automatically enforce the types of Accounts or even the specific Accounts that may make or receive Spends to/from other types of Accounts or specific Accounts may reduce the risk of error.
- Reduce risk of Unauthorized Spend Multiple Channelization systems may reduce the risk of unauthorized Spends by limiting the pathways by which an attacker who has compromised and gained access to a User Account may direct stolen value.
- An attacker seeking to make off with value stolen from one or more Accounts faces the need to exchange the stolen value, which can only circulate within the system, for some sort of value that exists external to the system.
- Channelization measures as described to regulate provision of exchange services and to detect unauthorized provision of such services impede such attempted exploits. Throughput Limits also complicate any attempt of an attacker to aggregate value in an intermediary Account secretly under the attacker's control.
- Account modules The system may impose universal adoption of Account Modules as a means of channelizing the flow of Spends to, within and from the set of Accounts belonging to a customer, particularly a business enterprise. Since the use of Account Modules entails obligatory use of multiple Accounts, the system may allow Spends between the Accounts of a particular Account Module to be free of Spend Fee and not to count against Throughput Limits.
- Receipts Account System may provide for Receipts Accounts. Use of a Receipts Account as the only type of Account in an Account Module capable of receiving Spends from outside that Module may facilitate the ability of System Provider to determine in the course of Transaction Monitoring whether Spends to a particular business enterprise are for a legitimate business purpose. For example one receipts Account may be designated for use only for receiving Spends that constitute sales revenue from the customers of the business, while another Receipts Account might be used only for incoming Spends that are not sales revenue, such as refunds from a vendor or a capital contribution from an owner of the business. The business customer in turn may benefit from the utility of a Receipts Account for strengthening its own internal controls as described below.
- SCI Receipts Account A requirement may be imposed on any enterprise using the system to accept payment online via automated means such as a shopping cart to cause all such incoming spends to be directed to an SCI-receipts Account. This requirement, constituting an example of Channelization, may thwart attempts of a customer to disguise incoming Spends stemming from illicit activity in several ways.
- the programmatic linkage of an SCI-Receipts Account to a particular URL enables System Provider to review the nature and content of the associated web page, both at the time of initial Account Module provisioning and subsequently, in the course of Transaction Monitoring.
- Disbursement Account. System may provide for
- Disbursement Accounts Use of a Disbursement Account as the only type of Account in an Account Module capable of making Spends to Accounts outside that Module may facilitate the ability of System Provider to determine whether Spends from a particular business enterprise are for a legitimate business purpose. For example, a business purporting to engage in online merchandise sales but secretly intending to operate a Ponzi scheme would betray its activity by attempting, whether directly or through one or more intermediaries, to make payouts to a large cohort of third parties, perhaps in some cases overlapping with the cohort of third parties from which Spends were originally received into the Account Module.
- Trading Account may provide for Trading Accounts as the only type of Account in an Account Module capable of making or receiving Spends to/from Financial Institutions. Imposition of Trading Accounts, especially in conjunction with the system of Throughput Limit Exception requests, may facilitate the ability of System Provider to detect unauthorized provision of financial services. Improved ability to both channelize Spends for activities such as currency exchange to authorized providers and to monitor them may also aid in detection of unusual patterns involving a single User frequenting multiple exchange providers and possibly warranting increased scrutiny.
- Trading-Disbursement Account System may provide for Trading-Disbursement Accounts.
- Account creation wizard The Account establishment and provisioning logic for business customers may be encapsulated in an Account creation wizard that guides the process in a convenient step-wise fashion. Since the complexity of provisioning the multiple Accounts of an Account Module may require more than one Session, the system may have the ability to save work in progress enabling the
- Account Module templates The process for establishing an Account module may employ a range of templates defining the constituent Account types comprising an Account Module. There may be a default module specifying only a basic complement of Accounts and more differentiated or specialized modules for businesses determined to fall into designated categories.
- Figure 13 shows a system 1300 of configuration for an Account Module 1302 for an Exchange Provider.
- Account Module 1302 and any Spends (represented by arrows) into or out of the Module are contained within the closed universe of Settlement Platform 1301.
- Receipts Accounts such as 1 SOS- IS 06 may receive Spends from Accounts external to Account Module 1302 and such Spends comprise the only mechanism whereby value may be conveyed into the module.
- Spends from Receipts Accounts 1303-1306 may only be made to Treasury Account 1307.
- Treasury Account 1307 is unable to directly receive or make Spends from/to any Account external to Account Module 1302.
- Treasury Account 1307 may receive Spends from any other Account within the module.
- Spends from Treasury Account 1307 may only be made to Disbursement Accounts within the same module such as
- Disbursement Accounts 1308 - 1311 Spends from Disbursement Accounts 1308-1311 may only be made to Accounts external to the module or to return value back to Treasury Account 1307. Only Receipts Accounts 1303 and 1304 may receive Spends that constitute the funding of exchange transactions in which the counterparty is not a Financial Institution. Spends to and from Accounts of other Financial Institutions may only be made or received respectively from and to Trading Accounts 1311 and 1306. Only Disbursement Account 1308 may be used to fulfill exchanges in which the counterparty is not a Financial Institution. Spends for paying expenses may only be made from Disbursement Account 1309.
- the system may support the ability for a business to extend an Account module congruent with its own business requirements and system rules. For example, a single business may operate more than one website or may desire to segregate receipts from different product lines on a single website into separate SCI-Receipts Accounts
- System may provide for binding an
- SCI-Receipts Account to a specific URL designated by the customer such that Shopping Cart Spends directed to the SCI-Receipts Account but originating from any other URL are not executed and instead generate an alert for possible evaluation by the System Provider.
- a Permissions assignment logic that precludes any User on a Disbursements Account from being a User on the module's Treasury Account reduces the risk of loss due to malfeasance or compromise of any single User's log-in credentials.
- the stringency of authentication settings on a Treasury Account could also be set higher, for example requiring the Spend instruction to come from a specific IP address and device such as a computer physically located in a secure area on the Member company's premises.
- an Account Module may closely mirror the stated business activities of a Member and cause deviations from that stated purpose to be more readily evident. For example, a business that purports to receive its revenue from online sales conducted via a specific url that instead receives a large volume of Spends into a miscellaneous Receipts Account may be seeking to obscure illicit commerce behind the "front" of a legitimate business. In the case of such intentions, the very need to explain the need for a large Throughput Limit on such a miscellaneous Receipts Account may serve as a deterrent to a nefarious enterprise that that had established Membership with the intent of masking illicit revenues.
- FIGS 9 and 10 show Currency exchange transactions as performed by an Exchange provider as the combination of two payments, one a Spend within the system, the other a conventional payment of money external to the system.
- the customer makes a funding payment in one Currency to the Exchange Provider.
- the Exchange Provider then makes a fulfillment payment to the Customer in the agreed upon fulfillment Currency.
- Figure 9 shows a system 900 for Currency exchange in which Exchange Customer buys a quantity of one of the system Base Moneys from Exchange Provider.
- the first payment 900- 1 is Funding Payment 902 from Exchange Customer 901 to Exchange Provider 903 of conventional money via a mutually agreeable payment method external to the System.
- the second payment 900-2 occurs internal to the System/Settlement Platform 908 as Exchange Provider makes Fulfillment Spend 906 from Exchange Provider's Account 905 to Exchange
- Figure 10 shows a system 1000 for Currency exchange in which Exchange Customer sells a quantity of one of the system Base Moneys to Exchange Provider.
- the first payment 1000-1 occurs internal to the System/Settlement Platform 1008 as Exchange Customer makes Funding Spend 1002 from Exchange Customer's Account 1001 to Exchange Provider's
- the second payment 1000-2 is Fulfillment Payment 1005 from Exchange Provider 1004 to Exchange Customer 1006 of conventional money via a mutually agreeable payment method external to the System.
- Depository Institution The System enables participating Depository Institutions to provide currency exchange services entirely by means of book entries in their own accounting systems without necessarily needing to resort to Spends or other transactions involving their asset portfolio.
- Currency exchange as performed by a Depository Institution may be effected at the Broad Money level, that is, by exchanging a quantity of one of their own conventional deposit liabilities denominated in a conventional Currency for a quantity of one of their own BMP Account liabilities, denominated and payable in one of the system-provided Base Moneys and/or vice versa.
- the Depository Institution may be able to take advantage of netting, that is, the cancelling out of offsetting credits and debits of multiple transactions involving transfers of their own liabilities, potentially enabling clearing of a large volume of exchanges with minimal or no obligatory resort to transactions to adjust their underlying asset portfolio.
- FIG. 12 shows a system 1200 whereby a participating Depository Institution exploits netting as it fulfills multiple Currency exchange orders involving BMP Accounts.
- Aggregate display 1201 shows a simplified online banking interface for three of its customers, 1203 - 1205 before (1201-1) and after (1201-2) each of them places, and the bank fulfills, Currency exchange orders involving their XXX-denominated BMP Accounts.
- the bank's simplified balance sheet 1202 is also displayed before (1202-1) and after (1202-2) events 1206-1-3.
- the Base Moneys of the disclosed System may serve as alternatives that circulate more or less in parallel and play a complementary role to those Issued/administered by government Monetary Authorities. Under such a paradigm, government Currencies remain subject to sovereign prerogative and the side by side existence of both kinds of money afford flexibility and choice.
- the system may be implemented to facilitate and reinforce its integration as an alternative rather than as a replacement for existing monetary systems.
- the disclosed system may be implemented in a fashion to explicitly encourage continued use of existing conventional numeraires.
- This strategy supported by interfaces that influence User experience, may not only de-emphasize but possibly discourage use of the native units of account of the core group Base Moneys as pricing/invoicing units.
- PAYPAL as one of innumerably many examples, faces limitations to its ability to lower costs due to the cost of interchange fees it incurs in the funding of payments.
- Use of the disclosed system as an alternative mode of funding payments may not only reduce such direct costs but may also diminish risk of payment repudiation affecting PAYPAL and, consequently, its own (payment recipient) customers.
- Price stability not a goal. Advocates of a gold standard are fixated on price stability, regarding it as a core goal of monetary arrangements.
- the disclosed system de- emphasizes use of the native unit of account of its core Currencies explicitly because of the potential for disruptive fluctuations in the value of gold and/or the other commodities used as backing that may occur incident to emergence of the system. While,
- USD as Numeraire may simply convey a lesser or greater quantity respectively of the Settlement Currency.
- Base Money stocks The ability of Primary Dealers to initiate Open Market Operations that result in either an increase or decrease in the quantity of Base Money in circulation in response to increased or decreased demand for such Currencies in currency exchange markets may enable automatic self-adjustment of Base Money stocks in perfect congruence with such market demand.
- Global bank The disclosed system may foster emergence of a global banking model, that is, banks capable of directly acquiring and serving customers from all over the world without obligatory need for Correspondent Banking relationships to accept deposits or fulfill withdrawals.
- Correspondent banking obsolete. The need for Correspondent Banking may be eliminated. All Financial Institutions that meet Membership requirements may directly participate.
- Imposition of an Account Maintenance Fee constitutes a form of Demurrage and may decrease the incentive to hold money balances leading to increased velocity of the disclosed Currencies. This increased velocity may result from increased incentive to spend or invest, directly or via a financial intermediary, in order to avoid the Demurrage. Increased velocity may also mitigate potential adverse consequences of a money supply constrained by physical limitations of the gold supply by enabling a smaller money stock to support a greater amount of economic activity/transactions.
- Emergence of the disclosed system may counteract so-called "moral hazard" on the part of financial institutions, that is, a tendency to seek increased profit by engaging in higher risk activities when such risks can be externalized.
- An example would be a bank taking on riskier but higher yielding assets in the expectation of a government "bail out” in the event of losses potentially exceeding its capital resources.
- BOP Balance of Payment
- Incoming flows do not necessarily require exchange into domestic Currency; incoming funds can readily be held on a distributed basis by the direct recipients without any obligatory involvement of domestic banks, correspondent banks in foreign countries, or the domestic government Monetary Authority. Likewise, spending any such accumulated balances by domestic payers to foreign recipients is an equally simple process. Any effects on relative exchange rates would involve gold and, presuming no nation eliminates its own Currency in favor of the disclosed gold-backed
- Currencies those issued by a Currency Board or Boards anchored to major national Currencies, may be to facilitate efficiencies of Currency Exchange. These efficiencies may arise from the availability of Base Moneys that serve as a near-identical substitute for the designated national Currencies that can be conveyed via Spends.
- the System is designed to foster eventual re-establishment of a new equilibrium, albeit likely at gold prices not previously observed relative to USD, EUR and other legacy Currencies. 152.
- Currency board tail wags dog.
- the System may enable Currencies of the secondary group, issued by Currency Boards, to circulate as a global Currency in certain embodiments.
- the transactional advantages of Spends over conventional modalities of payment, combined with system emergence that might lead to a very large community of Members, may enable the currency board to attain a global circulation that rivals that of the
- One or more resulting determinations and/or calculations can be sent remotely to the U.S. through the web, via phone line, or any other form of common carrier or communication system. Furthermore, one or more components of a system may be located outside the U.S. with the results of determinations and/or calculations communicated to the U.S.
- Account means a mechanism integral to the Settlement Platform serving as a means for (a) specified Account Owner(s) to hold quantities of the Base Moneys that circulate on the Settlement Platform thereby enabling the Account Owner(s) to receive Spends and, via an Account User authorized by the Account Owner(s), to make Spends.
- Administrative Override Spend means a Spend specified and Authorized by a system participant acting in an administrative capacity under the authority of the System
- Available Balance means the Balance in a Subaccount minus accrued liability for Account Maintenance Fee and any Holds.
- Account Module means a prescribed constellation of multiple specialized Accounts belonging to a particular owner or group of owners, preferably consisting of either: a) for a business or other Legal Person - a single Treasury Account and all non-Treasury Accounts to or from which Spends from or to that Treasury Account may be made or received including Receipts Accounts, SCI-Receipts Accounts, Trading Receipts Accounts, Disbursement Accounts and Trading Disbursement Accounts such as may be stipulated for that particular type of entity or, b) a Personal Account and its associated Referral Incentive Receipts Account. 158.
- Account Owner means a Member who/that alone or jointly with one or more other Members owns an Account.
- Account User means a User who is a Member and who is authorized to log-in as himself to the System and exercise Permissions that have been granted to him and not revoked relating to particular Accounts.
- Applicant means a Person on whose or which behalf the Person himself or a Proxy has submitted an application for Membership and who/which has not yet been accepted as a Member.
- Bailment means the act of Bailing and the resulting obligation on the part of the Bailee to hold the Bailed property for the purpose specified by agreement of the Bailor and Bailee and not to use it for any other purpose such as loaning it to a third party or encumbering it as security for a debt.
- Balance means Settled Balance.
- Base Money means Monetary Liabilities of an Issuer serving as the medium in which like-denominated Broad Money is payable.
- Broad Money means Monetary Liabilities of an institution other than an Issuer.
- Broad Money Product Account means a product offered by a Depository Institution by which the Depository Institution holds a balance or balances, denominated in one or more of the Currencies the Base Moneys of which circulate on the System, on account for its customer constituting liability(ies) of the Depository Institution payable to its customer either on demand or at maturity via a Withdrawal Spend of the Base Money of the Currency in which the BMP Account or subaccount is denominated.
- BMP Funding Spend means a Spend to an SCI-Receipts Account belonging to a
- Channelization means systems implemented by System Provider to narrow the range of system interactions available to a User so as to foster best practices on the part of Users and preclude numerous patterns of behavior that could, if permitted, lead to a larger volume of unauthorized or erroneous Spends or constitute illicit activities on the part of Users 169.
- Comptroller means a Role requiring performance of operations involving a Comptroller Account for the Distribution and Redemption of the Base Money of a particular Currency.
- Comptroller Account means an Account, belonging to an Issuer, designated as the sole Account permitted to receive Issuance Spends or to make Disbursement Spends involving a particular Currency.
- a Comptroller Account is exempt from Account Maintenance Fees.
- Correspondent Banking means a relationship between a pair of banks— neither of which are a Monetary Authority— in which deposits at one bank serve as reserves for the other.
- De-Issuance means the process by which Base Money is retired and extinguished such that it no longer exists.
- De-Issuance Spend means a Spend in which the Comptroller Account for a particular Currency is the paying Account and the Mint Account for that same Currency is the receiving Account resulting in De-Issuance of a quantity of Base Money for that Currency equal to the amount of the Spend.
- Delivery Instruction means an instruction to a Repository to remove designated assets from the custodial arrangements that enable their function as reserves underlying a particular Base Money and deliver them to the custody of a designated Person.
- Delivery Order means a Delivery Instruction that has been authorized in accordance with System requirements.
- Demurrage means a characteristic of certain moneys such that the quantity in overall circulation or constituting the holdings of an owner of a balance of such money diminishes as a function of time due to a fee imposed by its issuer.
- Depository Institution means a Financial Institution that has been Authorized by the System Provider to engage, as a business, in holding value on account for their customers the liability for which is payable via a Spend or which is offset on their balance sheet in part or in whole by assets comprised of a Balance or Balances held in Accounts.
- Disbursement Account means an Account that can only be used to make Spends to Accounts in other Account Modules and to make and receive Spends to or from the Treasury Account in the same Account Module.
- Disputed Spend means a Spend that an Account User on the payer or recipient Account claims was made, or which the System Provider determines may have been made, without proper authorization or for which the Spend Instruction was authorized but erroneous.
- a Disputed Spend also means a subsequent Spend from the recipient Account of a Disputed Spend which the System Provider in its sole judgment determines may constitute an attempt to wrongfully profit from the Disputed Spend.
- Distribution means the process by which newly Issued Base Money is distributed to the Primary Dealer on whose behalf it was created.
- Distribution Spend means a Spend from a Comptroller Account to an Account of a Primary Dealer.
- End User means any User acting otherwise than pursuant to a Specialized Role.
- Exchange Provider means a Financial Institution that has been authorized by the System Provider to engage, as a business, in the provision of Currency exchange services that require the making or receiving of Spends.
- a Hold means a restriction applied by the System Provider to a Subaccount that has been the recipient of a Disputed Spend that prevents a quantity of the relevant Currency equal to the lesser of the:
- a Holder means any Member who/that elects to acquire, accept, or otherwise receive or own a quantity of Base Money in circulation within the System.
- Identifier means an item of information such as but not limited to name, address, government issued identification number, date of birth (or incorporation), contact information, knowledge the possession of which is specific to an individual, biometric data, or documents that may be used to establish or verify the identity of a Person.
- Issuance means the process by which Base Money is created.
- Issuance Spend means a Spend in which the Mint Account for a particular Currency is the paying Account and the Comptroller Account for that same Currency is the receiving Account resulting in Issuance of a quantity of Base Money for that Currency equal to the amount of the Spend.
- Issuer means a Member assigned and bearing responsibility for the Roles of Mint and Comptroller for a particular Currency.
- Issuer's Declaration of Liability means a contractual declaration of liability defining a particular Base Money proffered by the Issuer of that Base Money and accepted by a prospective Holder
- Legal Person means any Person, such as but not limited to a corporation, trust or government entity, that is not a Natural Person.
- Linked Customer Account Module means a designated Account Module
- Account Owner or set of Account Owners of which is/includes the/an owner of a linked BMP Account or the linked Principal for whose/which benefit an Exchange Provider provides services.
- a Mass Spend means a Spend in which there is one paying Account and multiple recipient Accounts.
- Mint means a Role requiring performance of operations as the Account User of a Mint Account for the Issuance and De-Issuance of the Base Money of a particular Currency.
- Mint Account means a special account on the Settlement Platform, belonging to an Issuer, the absolute value of each Subaccount balance of which equals the combined sum of the Settled Balances of all like-denominated Subaccounts of all other Accounts in the System. A Mint Account is exempt from Account Maintenance Fees.
- Monetary Authority means an integrated system for the Issuance, Holding, Circulation and De-Issuance of the Base Money of a Currency accorded the status of Real Money, comprised of one or more Persons acting in the Roles of Issuer and System Provider.
- Monetary Liabilities means liabilities denominated in the unit of account particular to a Currency and issued to serve as a medium of exchange.
- Native Unit of Account means the Unit of Account specific to a particular Currency.
- Natural Rate of Interest means an interest rate that influences the allocation of resources between current consumption and investment for the future such that demand for investment funds is matched by saving to fund the investments.
- Natural Person means a human being.
- Numeraire means the Unit of Account of a specified Currency designated as the basis for calculation of a quantity of a Currency which may be the same or a different Currency.
- One person, One Member Rule means a rule that any particular Person may participate in the System as one and only one Member.
- Open Market Operations means the actions of a Primary Dealer, specifically to Bail or Redeem in accordance with provisions set forth in an Issuer's Declaration of Liability for a particular Base Money and applicable agreements between the Primary Dealer and the System Provider, which lead to an obligation on the part of that Issuer to respectively increase or decrease the amount of that particular Base Money in Circulation.
- Outside Money means with respect to the System any and all types of money or value in any form other than the Base Moneys that Circulate within the System. With respect to a Currency Board it means a Currency other than that Issued by the Currency Board.
- Person means a unique human being or other entity who or that has been assigned a unique number such as a tax identification number by a government or is itself a government or government agency.
- Personal Account means an Account belonging to one or more Account Owners who all are human beings and which Account is exclusively for personal rather than business use.
- Permission means a right granted by the System Provider or a delegate of the
- Privilege means a specified capability for interacting with System resources.
- Proxy means a Member who is a User acting on behalf of another Person with regard to that Person's status as an Applicant or Member.
- Real Money means a Currency, of which:
- the Base Money is suitable to be held by financial institutions as a reserve against like denominated Broad Money obligations such as bank deposits,
- Receipts Account means an Account that can only receive Spends from an Account in a different Account Module and can only make Spends to the Treasury Account or Personal Account in its own Account Module.
- Redemption means the process by which the Holder of a quantity of Base Money may return it to its Issuer and receive in exchange a quantity of assets as specified in that Issuer's Declaration of Liability.
- Redemption Spend means a Spend undertaken on the authority of a Primary Dealer for the purpose of Redemption in which an Account belonging to that Primary Dealer for a particular Currency is the paying Account and the Comptroller Account for that same Currency is the receiving Account.
- Reference Exchange Rate means an exchange rate provided by System Provider for Member convenience for purposes of expressing an approximately equivalent value for a Subaccount balance or a quantity conveyed via a Spend in terms of a Numeraire that differs from the Native Unit of Account of the Settlement Currency.
- Referral Incentive Program means a program by which existing Members are incentivized to refer new candidates for Membership.
- Referral Incentive Receipts Account means a Receipts Account that can only receive incoming transfers of value constituting distributions of benefits accrued under a Referral Incentive Program.
- Reserves Store means an online store offered by an Issuer and accessible only by a Primary Dealer enabling the designation of specific reserve assets to be delivered in fulfillment of a Redemption contemplated by that Primary Dealer enabling System to automatically enforce internal controls implemented to prevent breach of the applicable Issuer's Declaration of
- Role means a defined set of functions, privileges and obligations assigned to and assumed by a designated Person or category of Persons.
- Root User means the Account User who creates an Account or a successor who has been designated by the Root User on an Account and who has acknowledged and accepted the designation.
- SCI Receipts Account means a Receipts Account that can only receive Spends generated via a Shopping Cart Interface.
- Secure Area means any System Resources that are only accessible to a logged-in
- Settlement Currency means the Currency a quantity of which comprises the Balance in a Subaccount or is conveyed in a Spend.
- Specialized Role means a Role other than End user that is required for the governance or orderly function of the System.
- Spend means an Account-to- Account transfer, effected by book entry crediting the Account of the payer and debiting the Account(s) of the recipient(s) in an atomic transaction in fulfillment of a Spend Instruction that has been authorized in advance by an authorized User on the paying Account with said authorization communicated directly and securely from payer to System and Authenticated by the System.
- Spend Amount means the quantity of Settlement Currency conveyed or to be conveyed in a Spend.
- Spend Instruction means an instruction specifying the parameters of a Spend.
- Strict Debit Rule means a programmatically enforced rule that a Spend Instruction specifying a Spend Amount that is greater than the Available Balance in the paying Account will not be executed.
- SubAccount means a Currency-specific subdivision of an Account.
- an Account may entail one SubAccount for the disclosed gold-linked Currency and another for the disclosed Currency that is anchored to USD.
- System means the system and method disclosed in this document.
- System Provider means the Person responsible for assuring all aspects of the integrity of the System other than liabilities and other responsibilities assigned by contract to Persons designated to fulfill other Roles.
- the System Provider provides for operation and administration of the Settlement Platform, and is responsible for assigning or approving all Privileges that enable other Persons to act in designated Roles.
- Throughput Exception means an exception to a Throughput Limit such that a single Spend conforming to the parameters of a Throughput Exception Request that has been approved by the System Provider and has not expired is not counted against the Throughput Limit of the Account Module for which the Throughput Exception Request was granted.
- Throughput Exception Request means a request submitted with respect to a particular Account Module for a Throughput Exception, specifying for the anticipated subject Spend whether inbound or outbound, the counterparty Account, the purpose and maximum Spend Amount.
- Throughput Limit means a limit placed by System Provider specifying an amount determined by System Provider that can be received by Spends into or Spent from a particular Account Module during a specified interval of time.
- Trading-Disbursement Account means a Disbursement Account outgoing Spends from which, with the exception of Spends to the Treasury Account in the same Account Module, can only be made to an Account in an Account Module belonging to a Financial Institution or, in the case of a Trading-Disbursement Account belonging to a Primary Dealer, to a Comptroller Account.
- Trading-Receipts Account means a Receipts Account incoming Spends to which can come only from an Account in an Account Module belonging to a Financial Institution or, in the case of a Trading-Receipts Account belonging to a Primary Dealer, from a Comptroller Account.
- Treasury Account means an Account that can only make or receive Spends to/from other Accounts in the same Account Module.
- Unauthorized Spend means a Spend the Spend instruction of which was accepted by the System as authorized and executed but is subsequently determined to have been submitted without authorization of an Account User with the requisite Permissions on the paying Account.
- User means a Natural Person who has submitted a unique Username to the
- Visitor means a Person that accesses resources of the System for which log-In is not required.
- Website User means a User that is not an Applicant or Member.
- Withdrawal Disbursement Account means a designated Disbursement Account in the Account Module of a Depository Institution from and only from which Withdrawal Spends may be made.
- Withdrawal Spend means a Spend from a Withdrawal Disbursement Account to an Account in a Linked Customer Account Module in fulfillment of a withdrawal order involving a BMP Account.
Abstract
Description
Claims
Priority Applications (3)
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GB1518093.8A GB2527984A (en) | 2013-03-15 | 2014-03-14 | Systems and methods for a private sector monetary authority |
AU2014228217A AU2014228217A1 (en) | 2013-03-15 | 2014-03-14 | Systems and methods for a private sector monetary authority |
CA2906910A CA2906910A1 (en) | 2013-03-15 | 2014-03-14 | Systems and methods for a private sector monetary authority |
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US201361799053P | 2013-03-15 | 2013-03-15 | |
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US14/012,704 | 2013-08-28 | ||
US14/012,704 US20140279526A1 (en) | 2013-03-18 | 2013-08-28 | Systems and methods for a private sector monetary authority |
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WO2014143720A3 WO2014143720A3 (en) | 2014-12-31 |
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PCT/US2014/027797 WO2014143720A2 (en) | 2013-03-15 | 2014-03-14 | Systems and methods for a private sector monetary authority |
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CA (1) | CA2906910A1 (en) |
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Cited By (4)
Publication number | Priority date | Publication date | Assignee | Title |
---|---|---|---|---|
CN110417897A (en) * | 2019-07-31 | 2019-11-05 | 中国联合网络通信集团有限公司 | A kind of block chain divides domain triggering method, block chain node device and terminal |
CN112970234A (en) * | 2018-10-30 | 2021-06-15 | 维萨国际服务协会 | Account assertions |
CN113132174A (en) * | 2019-12-31 | 2021-07-16 | 阿里巴巴集团控股有限公司 | Network equipment inspection system, method, equipment and storage medium |
US11429476B2 (en) | 2021-01-07 | 2022-08-30 | The Toronto-Dominion Bank | Method and system for detecting data corruption |
Family Cites Families (6)
Publication number | Priority date | Publication date | Assignee | Title |
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AU2001261531A1 (en) * | 2000-05-10 | 2001-11-20 | E-Centives, Inc. | Using currency to purchase from sellers that do not recognize the currency |
US7720698B1 (en) * | 2000-12-20 | 2010-05-18 | Guaranty Fund Management Services | Method and apparatus for performing assessments |
US20020174065A1 (en) * | 2001-05-18 | 2002-11-21 | Chalice Coward | Multi-currency electronic payment system and terminal emulator |
US20080208725A1 (en) * | 2007-02-09 | 2008-08-28 | Roger Hoy | System and method facilitating private currency |
US8688563B2 (en) * | 2009-07-14 | 2014-04-01 | The Western Union Company | Alternative value exchange systems and methods |
US20110112951A1 (en) * | 2009-11-09 | 2011-05-12 | James Gould | Method and system for local currency backed by a valuable asset |
-
2014
- 2014-03-14 AU AU2014228217A patent/AU2014228217A1/en not_active Abandoned
- 2014-03-14 GB GB1518093.8A patent/GB2527984A/en not_active Withdrawn
- 2014-03-14 CA CA2906910A patent/CA2906910A1/en active Pending
- 2014-03-14 WO PCT/US2014/027797 patent/WO2014143720A2/en active Application Filing
Cited By (7)
Publication number | Priority date | Publication date | Assignee | Title |
---|---|---|---|---|
CN112970234A (en) * | 2018-10-30 | 2021-06-15 | 维萨国际服务协会 | Account assertions |
CN112970234B (en) * | 2018-10-30 | 2023-07-04 | 维萨国际服务协会 | Account assertion |
CN110417897A (en) * | 2019-07-31 | 2019-11-05 | 中国联合网络通信集团有限公司 | A kind of block chain divides domain triggering method, block chain node device and terminal |
CN110417897B (en) * | 2019-07-31 | 2022-08-02 | 中国联合网络通信集团有限公司 | Block chain domain-division triggering method, block chain node point equipment and terminal |
CN113132174A (en) * | 2019-12-31 | 2021-07-16 | 阿里巴巴集团控股有限公司 | Network equipment inspection system, method, equipment and storage medium |
US11429476B2 (en) | 2021-01-07 | 2022-08-30 | The Toronto-Dominion Bank | Method and system for detecting data corruption |
US11789810B2 (en) | 2021-01-07 | 2023-10-17 | The Toronto-Dominion Bank | Method and system for detecting data corruption |
Also Published As
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CA2906910A1 (en) | 2014-09-18 |
GB201518093D0 (en) | 2015-11-25 |
WO2014143720A3 (en) | 2014-12-31 |
AU2014228217A1 (en) | 2015-11-05 |
GB2527984A (en) | 2016-01-06 |
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