Fast Cryptocurrency Transaction Processing

Implementation Method

Embodiments of the invention include a method for conducting cryptocurrency transactions between users and resource providers. To initiate a transaction, users interact with an access device via a mobile device. The access device may be operated by the resource provider. The mobile device typically includes a mobile wallet app configured to:

Process cryptocurrency transactions initially.
Submit transactions to a blockchain network.

After processing, the mobile wallet app provides the access device with an access token (e.g., a payment token) linked to the user’s cryptocurrency address. The access device then uses this token to initiate an authorization process by sending an authorization request message to a token provider computer. The token provider communicates with the blockchain network to validate the transaction and sends an authorization response message back to the access device. Based on this response, the resource provider grants or denies resource access to the user.

Key Advantages

Leverages existing payment infrastructure for cryptocurrency transaction authorization and settlement.
Eliminates manual handling of cryptocurrency data (e.g., addresses) by merchants.
No third-party software required for transaction processing.

Terminology Definitions

Key Terms Explained

Term	Definition
Mobile Device	Any portable electronic device (e.g., smartphone, tablet, wearable) capable of remote communication via networks like 3G/4G, Wi-Fi, or Bluetooth.
Resource Provider	An entity offering goods/services (e.g., merchants, governments).
Access Device	Hardware for system access (e.g., POS terminals, ATMs, or virtual terminals).
Digital Wallet	Stores user credentials, bank details, and payment tokens for streamlined transactions.
Token	A substitute credential (e.g., payment token) for secure transactions.
Blockchain	A tamper-proof, decentralized database recording transactions in linked blocks.

Transaction Workflow

Step-by-Step Process

User Initiation:
- The user’s mobile wallet app generates a transaction using:
  - User’s crypto address.
  - Resource provider’s crypto address.
  - Transaction amount.
Transaction Submission:
- The signed transaction is sent to a blockchain node for validation.
- A cryptocurrency transaction identifier is returned to the mobile app.
Authorization Request:
- The mobile app creates a cEMV cryptogram using:
  - Access token.
  - Transaction data (e.g., amount, merchant ID).
  - A usage-restricted key (provided earlier by the token provider).
Validation & Approval:
- The token provider:
  - Maps the access token to the user’s crypto address.
  - Queries the blockchain node to verify the transaction using the identifier.
- Upon confirmation, an authorization response is sent back.
Settlement:
- For crypto payments: Amount is deducted (minus blockchain fees).
- For fiat conversions: A third-party service converts crypto to fiat for the merchant.

System Architecture

Key Components

Mobile Device: Hosts the wallet app and initiates transactions.
Access Device: Captures transaction details (e.g., POS terminal).
Token Provider Computer: Issues tokens and validates cryptograms.
Blockchain Network: Processes and verifies transactions.

graph LR
  A[Mobile Device] -->|Sends Transaction| B[Blockchain Node]
  B -->|Returns ID| A
  A -->|Sends Token/Cryptogram| C[Access Device]
  C -->|Authorization Request| D[Token Provider]
  D -->|Validation Query| B
  D -->|Authorization Response| C

FAQs

1. How does the system ensure transaction speed?

By using pre-authorized access tokens and usage-restricted keys, the system bypasses traditional blockchain confirmation delays, enabling near-instant approvals.

2. Can merchants accept both crypto and fiat payments?

Yes. If a merchant prefers fiat, the system routes payments through a third-party service that converts crypto to fiat automatically.

3. What happens if a transaction fails validation?

The token provider sends a rejection message, and the access device denies resource access. Users must resubmit the transaction.

4. How secure are usage-restricted keys?

These keys have thresholds (e.g., 3 uses max) and expire after predefined conditions, reducing fraud risk.

5. Is blockchain integration mandatory?

Yes, but merchants don’t need direct blockchain access. The token provider handles all interactions seamlessly.

👉 Explore secure crypto payment solutions
👉 Learn about blockchain integration

This system bridges cryptocurrency and traditional payment ecosystems, offering flexibility, security, and scalability for modern transactions.