Cryptocurrency based on a Smart Contract
Articolo scritto da Luca Vignali il 12/02/2018
Mathematical cryptocurrency concept
A cryptocurrency, to be regarded as such, must satisfy at least the following conditions:
Cryptocurrencies, like Bitcoin, Ethereum or other minor ones, have all of the characteristics mentioned above. In particular their generation algorithms are based on the competitive computational ability of the actors that hold information about the coin itself (so-called “miners”).
A Smart Contract is an application installed on all miners' computers, it is dormant but it can be relied on and invoked if you know its address. If specific conditions expected by the application happen, the Smart Contract will be able to perform certain actions automatically and autonomously, without suffering from outside alterations. This makes it an effective disintermediation system, as if appropriately programmed, a Smart Contract can perform an action only if there is a specific business transaction.
Cryptocurrency certified value
This document describes the mechanism to be implemented in order to obtain a cryptocurrency generated through a Smart Contract and not through an algorithmic competition, preserving the basic characteristics of a cryptocurrency.
The cryptocurrency based on a Smart Contract has, to support its value, an equivalent amount in another currency called “master coin”, it uses one or more support accounts denominated in master coin and a Smart Contract to guarantee the generation and management of crypto-coin.
In particular, automations must exist so that for each value deposited in the master coin account , the Smart Contract generates and transfers the ownership of this value in cryptocurrency to the actor who performed the transfer to the master account.
Similarly there must be automations so that created crypto-coin can be reconverted to master coin. In this case, the ownership of cryptocoin is to be transferred to the smart contract that destroys the crypto value and requires a transfer of master coin to an account indicated by the subject that requested the operation.
Support bank for Smart Contract
The characteristics that a bank must have to support the generation of coin through Smart Contract are:
To prepare one or more legal current accounts (Euro, Dollar, etc.).
To have a technology able to notify all events related to the transfer of the money to the aforementioned accounts, using standard protocols like REST calls or sending Push notification.
To provide a technology that transfers money Server2Server – without human intervention.
Active operation cycle: trasformation of master coin in cryptocoin
The subject who is interested to convert a given and accepted currency in crypto-coin, must transfer money to one of the aforementioned accounts. The Banking IT Architecture must be able to propagate this event, together with details of the payment, to a predetermined and certified destination (Smart Contract Interface) that instantly generates and transfers the amount to the senders of the payment.
Passive operation cycle: trasformation of the cryptocoin into master coin
The subject who is interested in converting its value owned in crypto-coin to a determined and accepted currency, it will have to transfer its ownership to the Smart Contract that will destroy the value and will provide a money transfer equivalent to one of accounts available to the account indicated by the initiating subject.
This provision must be Server2Server and must have been approved without human intervention.