Barclays Files Blockchain Patents To Streamline KYC and Fund Transfer Processes
U.K-based financial banking giant Barclays recently got two of its patents published by the U.S. Patent and Trademark Office (USPTO) on Thursday, July 19. One of these two patents is for the blockchain-based system to streamline fund transfers and the other one is to streamline the KYC process.
The fund transfer system for transfer of cryptocurrencies from payer to the recipient would first authenticate the identities of both, securely. Later by using the public-key cryptography and digital currency ledger, it would further validate and record these transactions.
The patent goes to describe that apart from just currency transfer, this system would also allow processing data in a secured and private for any other applications and use cases. The patent presents an example of insurance claims and credit status.
Barclays claims that this system can be used by anyone like individuals, enterprises, government authorities and banks. The patent also talks of using a Merkle Tree Structure to store blocks to ease the data validation process and maximize the efficiency.
The patent document notes: “The use of a block chain provides at least several benefits. These include its public nature, allowing any other party or entity from viewing the data and cryptographic verification of the data enabled by the digital signatures, hashing and layered nature of the block chain. The transaction is a complete and verified unit of data in a form that may be added to the block chain ... Further or duplicate checks and work may be avoided, which can improve the efficiency of computer networks.”
The other patent for the KYC talks more specifically on storing and endorsing claims and data for particular entities. The validation of the personal information is them implemented through KYC checks.
The Barclays proposal reads "a more reliable form of verification without substantially increasing technical overheads and improves the operation of computing environments and telecommunications networks.”
The patent application also talks about a “super” user authority wherein one is allowed to transfer old information to the existing blocks and delete the old ones with the approval of other members present in the system. This could help to overcome pertinent issues like the blockchain size and storage.
There is another patent from Barclays that talks of letting users to create and destroy units of digital currencies on the blockchain network. It also proposes a “current issuer secret keys” and “currency destroyer secret keys” using which a central bank and other financial institutions to control the currency’s monetary supply.
The patent application reads: ”[T]he units of digital currency may be set to any form of currency unit (for example, it may be set to a unit of fiat currency, such as US dollars, Euros, Pounds Sterling, etc), such that the digital currency represents an alternative way of keeping and spending fiat currency. This may have advantages in that the digital currency will not fluctuate in value against the fiat currency to which it is set.”