Internet DRAFT - draft-hardjono-blockchain-interop-arch
draft-hardjono-blockchain-interop-arch
Internet Engineering Task Force T. Hardjono
Internet-Draft MIT
Intended status: Informational M. Hargreaves
Expires: May 11, 2022 Quant Network
N. Smith
Intel
V. Ramakrishna
IBM
November 7, 2021
Interoperability Architecture for DLT Gateways
draft-hardjono-blockchain-interop-arch-03
Abstract
With the increasing interest in the potential use of blockchains and
decentralized ledger technology (DLT) networksorks for virtual asset
management, there is a need for these networks to have
interoperability to support applications and services built atop
these networks. An interoperability architecture for DLT networks is
therefore needed in order to permit the secure flow of digital assets
different DLT networks, satisfying the properties of transfer
atomicity, consistency and durability. The architecture must
recognize that there are different DLT networks and that the interior
constructs in these networks maybe incompatible with one another.
This document proposes an interoperability architecture based on DLT
Gateways, which are points of interconnection between networks.
Among others, the gateways implement one or more protocols for the
transfer (or exchange) digital assets between DLT networks. A
gateway belonging to a DLT network peers with another gateway
belonging to a different DLT network to perform the asset transfer
between the two networks.
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This Internet-Draft will expire on May 11, 2022.
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Table of Contents
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Terminology . . . . . . . . . . . . . . . . . . . . . . . . . 3
3. Assumptions and Principles . . . . . . . . . . . . . . . . . 6
3.1. Design Principles . . . . . . . . . . . . . . . . . . . . 6
3.2. Operational Assumptions . . . . . . . . . . . . . . . . . 7
4. Interoperability Modes . . . . . . . . . . . . . . . . . . . 7
5. Architecture . . . . . . . . . . . . . . . . . . . . . . . . 9
5.1. Goal of Architecture . . . . . . . . . . . . . . . . . . 9
5.2. Overview of Asset Transfer . . . . . . . . . . . . . . . 10
5.3. Desirable Properties of Asset Transfer . . . . . . . . . 10
5.4. Event log-data, crash recovery and backup gateways . . . 11
5.5. Overview of the Phases in Asset Transfer . . . . . . . . 12
6. Pre-transfer Verification of Asset and Identities (Phase 1) . 13
7. Evidence of asset locking or escrow (Phase 2) . . . . . . . . 15
8. Transfer Commitment (Phase 3) . . . . . . . . . . . . . . . . 17
9. Related Open Issues . . . . . . . . . . . . . . . . . . . . . 19
9.1. Global identification of blockchain systems and public-
keys . . . . . . . . . . . . . . . . . . . . . . . . . . 19
9.2. Discovery of gateways in DLT Networks . . . . . . . . . . 20
9.3. Remote gateway discovery . . . . . . . . . . . . . . . . 20
9.4. Commitment protocols and forms of commitment evidence . . 20
10. Security Considerations . . . . . . . . . . . . . . . . . . . 21
11. Policy Considerations . . . . . . . . . . . . . . . . . . . . 21
12. References . . . . . . . . . . . . . . . . . . . . . . . . . 22
12.1. Normative References . . . . . . . . . . . . . . . . . . 22
12.2. Informative References . . . . . . . . . . . . . . . . . 22
Authors' Addresses . . . . . . . . . . . . . . . . . . . . . . . 24
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1. Introduction
Currently there is little technical interoperability between
decentralized ledger technology (DLT) networks. This results in the
difficulty in transferring or exchanging virtual (digital) assets
from one DLT network to another directly.
The existing solutions involve a third party that mediates the
transfer. This mediating third party is typically an asset-exchange
entity (i.e. crypto-exchange) operating in a centralized hub-spoke
fashion. This reliance on a third party results not only in delays
in transfers, but also in the need for asset owner to have a business
relationship (e.g. open accounts) at the mediating third party. Many
of these solutions centralize control at the hands of the mediating
party, thereby diminishing the autonomy of blockchains and DLT
networks, and limits their scalability.
This document proposes an interoperability architecture based on DLT
Gateways, which are points of interconnection between networks.
There are several services that may be offered by a DLT gateway, one
of which being the direct transfer of a digital asset from one DLT
network to another via pairs of gateways without a mediating third
party. A given DLT network may have one or more gateways to perform
a unidirectional direct transfer of digital assets to another DLT
network possessing one or more compatible gateway. Similar to the
notion of border gateways in interdomain routing (e.g. running the
BGPv4 protocol), a DLT gateway belonging to an origin DLT network is
said to peer with another gateway is a destination DLT network. Both
gateways must implement an asset transfer protocol that must satisfy
certain security, privacy and atomicity requirements.
The purpose of this architecture document is to provide technical
framework within which to define the required properties of a DLT
gateway that supports an atomic asset transfer protocol, such as ODAP
[ODAP]. These properties include the security, reliability and data
privacy of digital asset transfers between pairs of gateways
belonging to differing DLT networks.
2. Terminology
There following are some terminology used in the current document.
We borrow terminology from NIST and ISO as much as possible,
introducing new terms only when needed:
o Blockchain system: Blockchains are distributed digital ledgers of
cryptographically signed transactions that are grouped into
blocks. Each block is cryptographically linked to the previous
one (making it tamper evident) after validation and undergoing a
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consensus decision. As new blocks are added, older blocks become
more difficult to modify (creating tamper resistance). New blocks
are replicated across copies of the ledger within the network, and
any conflicts are resolved automatically using established rules
[NIST].
o Distributed ledger technology (DLT) system: Technology that
enables the operation and use of distributed ledgers, where the
ledger is shared (replicated) across a set of DLT nodes and
synchronized between the DLT nodes using a consensus mechanism
[ISO].
o DLT Network: A generic term for blockchain systems.
o Resource Domain: Resource Domain: The collection of resources and
entities participating within a blockchain or DLT network. The
domain denotes an boundary for permissible or authorized actions
on resources.
o Interior Resources: The various interior protocols, data
structures and cryptographic constructs that are a core part of a
blockchain or DLT network. Examples of interior resources include
the ledger (blocks of confirmed transaction data), public keys on
the ledger, consensus protocol, incentive mechanisms, transaction
propagation networks, etc.
o Exterior Resources: The various resources that are outside a
blockchain or DLT network, and are not part of the operations of
the network. Examples include data located at third parties such
as asset registries, ledgers of other DLT network, PKI
infrastructures, etc.
o Nodes: The nodes of the blockchain or DLT system which form the
peer-to-peer network, which collectively maintain the shared
ledger in the system by following a consensus algorithm.
o DLT Gateway: a DLT gateway is the collection of services,
controlled by one legal entity, which connects to a minimum of one
DLT network to provide read and write access to the ledger of that
DLT network. A DLT gateway implements an atomic digital asset
transfer protocol, such as ODAP [ODAP], via a DLT-neutral data
formats and local storage logs. A gateway does not implement an
interior consensus protocol.
o DLT address: This is the public-key of an entity as known within a
DLT network or blockchain system, employed to transact on the DLT
network and recorded on the ledger of the DLT network. Also
referred to as the transaction public key.
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o Entity public-key pair: This the private-public key pairs of an
entity used for interactions outside the DLT network (e.g. TLS
1.3). The term is used to distinguish this public-key from the
blockchain address.
o Asset transfer protocol: The gateway-to-gateway technical protocol
used by two gateways to perform a unidirectional transfer of a
virtual (digital_ asset.
o Asset profile: The prospectus of a regulated asset that includes
information and resources describing the virtual asset. This
includes, among others, the asset name/code, issuing authority,
denomination, jurisdiction, and the URLs and mechanisms to
validate the information. The asset profile is independent from
the specific instantiation of the asset (on a DLT network or
otherwise) and independent from its instance-ownership
information.
o Virtual Asset: A virtual asset is a digital representation of
value that can be digitally traded, or transferred as defined by
the FATF [FATF]. We use the term interchangeably with ?digital
asset?.
o Virtual Asset Service Provider (VASP): Legal entity handling
virtual assets as defined by the FATF [FATF].
o Originator: Person or organization seeking the transfer of virtual
asset to a beneficiary
o Beneficiary: Person or organization receiving the transferred
virtual asset from an originator.
o Travel Rule information: Data regarding the VASPs, originators and
beneficiaries involved in an asset transfer, as defined by the
FATF [FATF] and as required by the jurisdiction of operations of
the VASPs.
o Gateway device identity: The identity of the device implementing
the gateway functions. The term is used in the sense of IDevID
(IEEE 802.1AR) or EK/AIK (in TPM1.2 and TPM2.0) [IDevID].
o Gateway owner: The VASP who legally owns and operates a gateway
within a DLT network.
o Asset locking or escrow: The conditional mechanism used within a
DLT network to make an asset temporarily unavailable for use by
its owner. The condition of the asset release can be based on a
duration of time (e.g. hash time locks) or other parameters.
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o Gateway crash recovery: The local process by which a crashed
gateway (i.e. device or system fault) is returned back into a
consistent and operational state, ready to resume the asset
transfer protocol with the peer gateway prior to the crash event.
Further terminology definitions can be found in [NIST] and [ISO].
The term 'blockchain' and 'distributed ledger technology' (DLT) are
used interchangeably in this document.
3. Assumptions and Principles
The following assumptions and principles underlie the design of the
current gateway architecture, and correspond to the design principles
of the Internet architecture.
3.1. Design Principles
o Opaque DLT resources: The interior resources of each DLT network
is assumed to be opaque to (hidden from) external entities. Any
resources to be made accessible to an external entity must be made
explicitly accessible by a gateway with proper authorization.
o Externalization of value: The gateway protocol is agnostic
(oblivious) to the economic or monetary value of the virtual asset
being transferred.
The opaque resources principle permits the interoperability
architecture to be applied in cases where one (or both) DLT networks
are permissioned (private). It is the analog of the autonomous
systems principle in IP networking [Clar88], where interior routes in
local subnets are not visible to other external networks.
The value-externalization principle permits asset transfer protocols
to be designed for efficiency, security and reliability - independent
of the changes in the perceived economic value of the virtual asset.
It is the analog of the end-to-end principle in the Internet
architecture [SRC84], where contextual information (economic value)
is placed at the endpoints of the transaction. In the case of a
transfer of virtual assets, the originator and beneficiary at the
respective DLT networks are assumed to have a common agreement
regarding the economic value of the asset. This context of the
economic meaning of the value of the asset is assumed to exists at
the end-points, namely at the originator and beneficiary.
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3.2. Operational Assumptions
The following conditions are assumed to have occurred, leading to the
invocation of the asset transfer protocol between two gateways:
o Application layer transfer request: The transfer request from an
originator in the origin DLT network is assumed to have occurred
prior to the execution of the asset transfer protocol.
o Identification of originator and beneficiary: The originator and
beneficiary are assumed to have been identified and that consent
has been obtained from both parties regarding the asset transfer.
o Identification of origin and destination DLT networks: The origin
and destination DLT networks is assumed to have been identified.
o Selection of gateway: The two gateway at the origin and
destination DLT networks respectively is assumed to have been
identified and selected.
o Identification of gateway-owners (VASP): The VASP operating the
gateway are assumed to have been identified and their status
verified [FATF].
4. Interoperability Modes
Before delving into the architecture, it would be instructive to
survey the different modes (or categories) of operations that
necessitate interoperability between two blockchain/DLT network,
virtual asset transfer being one such category.
We can reason about this in terms of the interdependencies between
business processes in two independent systems. In one category, a
ledger state update in one system depends on an update in the other.
In other words, a write operation must be performed on both ledgers
to maintain integrity of the collective system; if either ledger lies
in a blockchain system or DLT network, a new block is also added.
From this, one can infer that both writes, or ledger state updates,
must occur atomically (either both happen or neither does) across
both systems despite their independence and lack of a central
coordinator.
The category of atomic writes can further be classified into asset
transfers and asset exchanges. In the former, a virtual asset is
expunged in one system while atomically being recreated in the other;
the owner and recipient need only have accounts in their respective
DLT networks. In the latter, two virtual assets are exchanged in two
distinct networks atomically; they simply switch ownership without
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their profile records leaving their respective systems' ledgers. In
this scenario, both owners must have accounts in both networks.
Moving back up the categorization hierarchy, we can identify a
different category in which a ledger state update in one system
depends on already recorded state in the ledger of another. In other
words, a write operation must be performed in one ledger after
reading state from another. The use case under this category can be
termed data transfer or data sharing, where the advancement of a
business workflow in one system depends on the advancement of a
different workflow in another without requiring an atomic operation
across the two systems. Here, it is useful to distinguish data from
asset; the former can be copied in and across systems without losing
its integrity whereas the latter must have an unambiguous ownership
record at all times.
Cross DLT-System Dependency
|
|
+-----------------------------------+
| |
| |
+--------------------+ +--------------------+
| Bidirectional | | Unidirectional |
| (Write <--> Write) | | (Read --> Write) |
+--------------------+ +--------------------+
| |
| |
+------------------+ |
| | |
| | |
+----------------+ +----------------+ +-----------------+
| Asset Transfer | | Asset Exchange | | Data Transfer |
+----------------+ +----------------+ +-----------------+
Figure 1
Though the rest of this document focuses on a gateway architecture to
facilitate virtual asset transfers, the same architecture can also be
used for asset exchanges and data transfers. Interested readers can
find out more about cross DLT-system asset exchanges by referring to
literature on Hashed Time Lock Contracts [HTLC21], on cross network
data transfers [Abebe19][Abebe21], and on ledger state views and
addresses [DLVIEW].
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5. Architecture
5.1. Goal of Architecture
The goal of the interoperability architecture is to permit two (2)
Gateways belonging to distinct DLT networks to conduct a virtual
asset transfer between them, in a secure and non-repudiable manner
while ensuring the asset does not exist simultaneously on both
networks (double-spend problem).
The virtual asset as understood by the two gateway is a digital
representation of value, expressed in an standard digital format in a
way meaningful to the gateway syntactically and semantically.
The syntactic representation of the virtual asset between the two
gateways need not bear any resemblance to the syntactic asset
representation within their respective DLT networks.
The architecture recognizes that there are different DLT networks
currently in operation and evolving, and that in many cases the
interior technical constructs in these DLT networks maybe
incompatible with one another.
The architecture therefore assumes that certain types of computer
systems (i.e. gateway) will be equipped with an asset transfer
protocol and with other relevant resources that permits greater
interoperability across these DLT networks.
The resources within a DLT network (e.g. ledgers, public-keys,
consensus protocols, etc.) are assumed to be opaque to external
entities in order to permit a resilient and scalable protocol design
that is not dependent on the interior constructs of particular
blockchain system or DLT network. This ensures that the virtual
asset transfer protocol between gateways is not conditioned or
dependent on these local technical constructs. The role of a gateway
therefore is also to mask (hide) the complexity of the interior
constructs of the DLT network that it represents. Overall this
approach ensures that a given DLT network operates as a true
autonomous system.
The current architecture focuses on unidirectional asset transfers,
although the building blocks in this architecture can be used to
support protocols for bidirectional transfers (conditional two
unidirectional transfers), atomic asset exchanges and data transfers.
For simplicity the current architecture employs two (2) gateways in
the respective DLT networks, but collective multi-gateway transfers
(i.e. multiple gateways at each side) [HS2019] may be developed based
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on the building blocks and constructs identified in the current
architecture.
5.2. Overview of Asset Transfer
An asset transfer between two DLT networks is carried out by two (2)
gateway in a direct interaction (unmediated), where the gateway
represents the two respective DLT networks.
A successful transfer results in the asset being extinguished
(deleted) or marked on the origin ledger by the origin-gateway, and
for the asset to be introduced by the destination-gateway into the
destination ledger.
The mechanism to extinguish or introduce an asset from/into a ledger
is dependent on the specific blockchain or DLT network. The task of
the respective gateway is to implement the relevant mechanism to
modify the ledger of their corresponding DLT networks in such a way
that together the two DLT networks maintain consistency from the
asset perspective, while observing the design principles of the
architecture.
An asset transfer protocol that can satisfy the properties of
atomicity and consistency in the case of two private DLT networks
should also satisfy the same properties in the case when one or both
are public.
5.3. Desirable Properties of Asset Transfer
The desirable features of asset transfers between two gateway
include, but not limited, to the following:
o Atomicity: Transfer must either commit or entirely fail (failure
means no change to asset ownership).
o Consistency: Transfer (commit or fail) always leaves the ledgers
of both DLT networks to be in a consistent state (asset located in
the ledger of one DLT network only).
o Isolation: While transfer occurring, asset ownership cannot be
modified (no double-spend).
o Durability: Once a transfer has been committed, must remain so
regardless of gateway crashes.
o Verifiable by authorized third parties: With proper authorization
to access relevant interior resources, third party entities must
be able at any time to perform audit-validation of the two
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respective ledgers for asset transfers across the corresponding
DLT networks.
o Containment of side-effects: Any effects due to errors or
security/integrity breaches in a DLT network during an asset
transfer must be contained within that network.
An implementation of the asset transfer protocol should satisfy these
properties, independent of whether the implementation employs
stateful messaging or stateless messaging between the two gateways.
5.4. Event log-data, crash recovery and backup gateways
Implementations of gateway should maintain event logs and checkpoints
for the purpose of gateway crash recovery. The log-data generated by
a gateway should be considered as an interior resource accessible to
other authorized gateways within the same DLT network.
Mechanisms used to select or elect a gateway in a DLT network for a
given asset transfer could be extended to include the selection of a
backup gateways. The primary gateway and the backup gateway may or
may not belong to the same owner (VASP).
Some DLT networks may utilize the ledger itself as means to retain
the log-data, allowing other nodes in the DLT network to have
visibility and access to the gateway log-data. Other DLT networks
may employ off-chain storage that is accessible to all gateway in the
same authorization domain. In such cases, to provide event-
sequencing integrity the gateway may store a hash of the log- data on
the ledger of the DLT network prior to writing the log-data to the
off-chain storage.
The mechanism used to provide gateway crash-recovery is dependent on
the DLT network and the gateway implementation. For interoperability
purposes the information contained in the log and the format of the
log-data should be standardized, permitting vendors of gateway
products to reduce development costs over time. Similarly, in order
to ensure a high degree of interoperability across crash-recovery
protocol implementations [BCH21], a standardized interface (e.g.
REST APIs) should be defined for read/ write access to the log-
storage. The interface should hide the details of the log-storage
from the gateway itself, and it should be independent of the gateway
recovery strategy (e.g. self-healing, primary-backup, etc.).
The resumption of an interrupted transfer (e.g. due to gateway crash,
network failure, etc.) should take into consideration the aspects of
secure channel establishment and the aspects of the transfer protocol
resumption. In some cases, a new secure channel (e.g. TLS session)
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must be established between the two gateways, within which the asset
transfer protocol could be continued from the last checkpoint prior
to the interruption. However, in other cases both the secure channel
and the transfer protocol may need to be started completely afresh
(no resumption).
The log-data collected by a gateway acts also as a checkpoint
mechanism to assist the recovered (or backup) gateway in continuing
the transfer. The point at which to re-start the transfer protocol
flow is dependent on the implementation of the gateway recovery
strategy. Some owners (VASPs) of gateways may choose to start afresh
the transfer of the asset, and not to resume partially completed
transfers (e.g. for easier legal audit purposes).
5.5. Overview of the Phases in Asset Transfer
The interaction between two gateways in an asset transfer is
summarized in Figure 2, where the origin DLT network is DLN1 and the
destination network is DLN2. The gateways are denoted as G1 and G2
respectively.
Originator Beneficiary
| |
+-------------+ +-------------+
| Client | | Client |
| Application | | Application |
| (App1) | | (App2) |
+-------------+ +-------------+
| |
| (Phases) |
V V
+-------------+ |<-----(1)----->| +-------------+
| DLT Network | +----+ +----+ | DLT Network |
| DLN1 | |Gate| |Gate| | DLN2 |
| |--|way |<-----(2)----->|way |--| |
| +---------+ | | G1 | | G2 | | +---------+ |
| |Ledger L1| | +----+ +----+ | |Ledger L2| |
| +---------+ | |<-----(3)----->| | +---------+ |
+-------------+ +-------------+
Figure 2
The phases are summarized as follows.
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o Phase 0: Initiation of transfer at the application layer. The two
applications utilized by the originator and beneficiary is assumed
to interact as part of the asset transfer. In this phase, the
applications App1 and App2 may establish some context information
(e.g. Session-ID) that will be made available to their respective
gateways G1 and G2. The legal verification of the identities of
the Originator and Beneficiary may occur in this phase [FATF].
This phase is outside the scope of the current architecture.
o Phase 1: Pre-transfer Verification of Asset and Identities. In
this phase the gateways G1 and G2 must mutually identify
themselves and authenticate that both possess gateway-
capabilities. Gateway G1 must communicate to G2 the asset-profile
of the asset to be transferred, while G2 must validate that it has
the ability to support this type of asset in the ledger of its DLT
network.
o Phase 2: Evidence of asset locking or escrow. In this phase,
gateway G1 must provide gateway G2 with sufficient evidence that
the asset on DLN1 is in a locked state (or escrowed) under the
control of G1 on ledger L1, and safe from double-spend by its
current owner (the originator).
o Phase 3: Transfer commitment. In this phase gateways G1 and G2
commit to the unidirectional asset transfer.
These phases will be further discussed below.
6. Pre-transfer Verification of Asset and Identities (Phase 1)
The primary purpose of the first phase is to verify the various
information relating to the asset to be transferred, the correct
identities of the originator and beneficiary (as provided by the
respective applications), the identity and legal status of the
entities (VASPs) who own and operate the gateways, the type of the
DLT network, and network parameters, and the device-identities of the
gateways.
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Orig L1 G1 G2 L2 Benef
| | | | | |
|---request------->| | | |
| | | | | |
..|.....|............|....................|............|.....|..
| | | Phase 1 | | |
| | | | | |
| | (1.1)|<-----VASP id------>| | |
| | | | | |
| | | | | |
| | (1.2)|<--Asset Profile--->| | |
| | | | | |
| | | | | |
| | (1.3)|<--Orig/Benef id--->| | |
| | | | | |
..|.....|............|....................|............|.....|..
| | | | | |
Figure 3
This phase starts with the assumption that in DLN1 the gateway to
process the asset transfer to DLN2 has been selected (namely gateway
G1). It also assumes that the destination DLN2 has been identified
where the beneficiary address is located, and that gateway G2 in DLN2
has been identified that will peer with G1 to perform the transfer.
There are several steps that may occur in Phase 1:
o Secure channel establishment between G1 and G2: This includes the
mutual verification of the gateway device identities and the
exchange of the relevant parameters for secure channel
establishment. In cases where device attestation [RATS] is
required, the mutual attestation protocol must occur between G1
and G2 prior to proceeding to the next phase.
o Mutual device attestations: In cases where device attestation
[RATS] is required, each gateway must yield attestation evidence
to the other regarding its configuration. A gateway may take on
the role as a attestation verifier, or it may rely on an external
verifier to appraise the received evidence.
o Validation of the gateway ownership: There must be a means for
gateway G1 and G2 to verify their respective ownerships (i.e.
VASP1 owning G1 and VASP2 owning G2 respectively). Examples of
ownership verification mechanism include the chaining of the
gateway-device X.509 certificate up to the VASP entity
certificate, directories of gateways and VASPs, and others.
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o Validation of VASP status: In some jurisdictions limitations may
be placed for regulated VASPs to transact only with other
similarly regulated VASPs. Examples of mechanisms used to
validate a VASP legal status include VASP directories, Extended
Validation (EV) X.509 certificates for VASPs, and others.
o Identification and validation of asset profile: Both gateways must
agree on the type of asset being transferred based on the profile
of the asset. Gateway G1 must communicate the asset-profile
identification to gateway G2, who in turn must validate both the
legal status of the asset as well as the technical capability of
DLN2 to digitally represent the asset type within its ledger L2.
The policies governing DLT network DLN2 with regards to
permissible incoming assets must be enforced by G2.
o Exchange of Travel Rule information and validation: In
jurisdictions where the Travel Rule policies regarding originator
and beneficiary information is enforced [FATF], the owners of
gateways G1 and G2 must comply to the Travel Rule. Mechanisms
must be used to permit gateways G1 and G2 to make available
originator/beneficiary information to one another in such away
that the Travel Rule information can be logged as part of the
asset transfer history.
o Negotiation of asset transfer protocol parameters: Gateway G1 and
G2 must agree on the parameters to be employed within the asset
transfer protocol. Examples include endpoints definitions for
resources, type of commitment flows (e.g. 2PC or 3PC), lock-time
durations, and others [ODAP].
7. Evidence of asset locking or escrow (Phase 2)
The asset transfer protocol can commence when both gateways G1 and G2
have completed the verifications in Phase 1.
The steps of Phase 2 are summarized in Figure 4, and broadly consists
of the following:
o Commencement (2.1): Gateway G1 indicates the start of the asset
transfer protocol by sending a transfer-commence message to
gateway G2. Among others, the message must include a
cryptographic hash of the information agreed-upon in Phase 1 (e.g.
asset profile, gateway identities, originator/beneficiary public
keys, etc.).
o Acknowledgement (2.2): The gateway G2 must send an explicit
acknowledgement of the receipt of the commence message, which
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should include a hash of commencement message (2.1) and other
relevant session parameters.
o G1 lock/escrow asset (2.3): Gateway G1 proceeds to lock or escrow
the asset belonging to the originator on ledger L1. This prevents
other transactions from changing the state of the asset in L1
until such time the lock by G1 is finalized or released. A time-
lock or escrow may also be employed. The mode of the escrow may
depend on the fundamental ledger architecture of the respective
DLN1 and DLN2 in question (e.g. account-based, UTXO, or other).
o G2 logs incoming asset (2.4): Gateway G2 correspondingly writes a
non-committing log (passive transaction) on ledger L2 indicating
an imminent arrival of the asset to L2. This may act as a
notification for the beneficiary regarding the asset transfer.
o Lock Evidence (2.5): Gateway G1 sends a digitally signed evidence
regarding the lock (escrow) performed by G1 on the asset on ledger
L1. The signature by G1 is performed using its entity public-key
pair. This signifies that G1 (i.e. its owner VASP) is legally
standing behind its assertion regarding the lock/escrow on the
asset performed by G1.
o Evidence receipt (2.6): If gateway G2 accepts the evidence, G2
then responds with a digitally signed receipt message which
includes a hash of the previous lock-evidence message. Otherwise,
if G2 declines the evidence then G2 can ignore the transfer and
let it time-out (i.e. transfer failed). The signature by G2 is
performed using its entity public-key pair.
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Orig L1 G1 G2 L2 Benef
| | | (Phase 1) | | |
| | | | | |
..|.....|............|....................|............|.....|..
| | | Phase 2 | | |
| | | | | |
| | (2.1)|-----Commence------>| | |
| | | | | |
| | |<-------ACK---------|(2.2) | |
| | | | | |
| | | | | |
| |<---Lock----|(2.3) | | |
| | | (2.4)|----Log---->| |
| | | | | |
| | | | | |
| | (2.5)|---Lock Evidence--->| | |
| | | | | |
| | |<-----Receipt-------|(2.6) | |
| | | | | |
..|.....|............|....................|............|.....|..
| | | | | |
Figure 4
The precise form of the evidence in step 2.5 is dependent on the type
of ledger technology in DLN1, and must be previously agreed upon
between G1 and G2 in Phase 1.
The purpose of this evidence is for dispute resolution between G1 and
G2 (i.e. the VASP entities who own and operate G1 and G2
respectively) in the case that double-spend is later detected.
The gateway G2 must return a digitally signed receipt to G1 of this
evidence in order to cover G1 (exculpatory proof) in the case of
later denial by G2.
8. Transfer Commitment (Phase 3)
In Phase 3 the gateways G1 and G2 finalizes to the asset transfer by
performing a commitment protocol (e.g. 2PC or 3PC) as a process (sub-
protocol) embedded within the overall asset transfer protocol.
Upon receiving the evidence-receipt message in the previous phase, G1
begins the commitment (see Figure 5):
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o Commit-prepare (3.1): Gateway G1 indicates to G2 to prepare for
the commitment of the transfer. This message must include a hash
of the previous messages (message 2.5 and 2.6).
o Ack-prepare (3.2): Gateway G2 acknowledges the commit-prepare
message.
o Lock-final (3.3): Gateway G1 issues a lock-finalization
transaction or escrow finalization on ledger L1 that signals the
permanent extinguishment of the asset from DLN1. This transaction
must include a hash reference to the lock transaction on L1
previously in step (2.3). This indicates that the asset is no
longer associated with the public-key of its previous owner
(originator) and that the asset instance is no longer recognized
on the ledger L1.
o Commit-final (3.4): Gateway G1 indicates to G2 that G1 has
performed a local lock/escrow finalization on L1. This message
must be digitally signed by G1 and should include the block number
and transaction number (of the confirmed block) on ledger L1.
o Asset-create (3.5): Gateway G2 issues a transaction on ledger L2
to create (re-generate) the asset, associated with the public-key
of the beneficiary. This transaction must include a hash of the
previous message (3.4) and hash reference to the log-incoming
transaction on L2 previously in step (2.4). These hash references
connects the newly re-generated asset with the overall transfer
event originating from gateway G1.
o Ack-final (3.6): Gateway G2 indicates to G1 that G2 has performed
an asset-regeneration transaction on L2. This message must be
digitally signed by G2 and should include the block number and
transaction number (of the confirmed block) on ledger L2.
o Location-record (3.7): Gateway G1 has the option to record the
block number and transaction number (as reported by G2 in the
previous step) to ledger L1. This transaction should include a
hash reference to the confirmed lock-finalization transaction on
L1 from step 3.3. This information may aid in future search,
audit and accountability purposes from a legal perspective.
o Transfer complete (3.8): Gateway G1 must explicitly close the
asset transfer session with gateway G2. This allows both sides to
close down the secure channel established in Phase 1.
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Orig L1 G1 G2 L2 Benef
| | | (Phase 2) | | |
| | | | | |
..|.....|............|....................|............|.....|..
| | | Phase 3 | | |
| | | | | |
| | (3.1)|--Commit Prepare--->| | |
| | | | | |
| | |<-----ACK-Prep------|(3.2) | |
| | | | | |
| | | | | |
| |<--Final----|(3.3) | | |
| | | | | |
| | (3.4)|----Commit Final--->| | |
| | | | | |
| | | (3.5)|---Create-->| |
| | | | | |
| | |<-----ACK-Final-----|(3.6) | |
| | | | | |
| | | | | |
| |<--Record---|(3.7) | | |
| | | | | |
| | (3.8)|---Complete/End---->| | |
| | | | | |
..|.....|............|....................|............|.....|..
| | | | | |
Figure 5
9. Related Open Issues
There are a number of open issues that are related to the asset
transfer protocol between gateways. Some of the issues are due to
the fact that blockchain technology is relatively new, and that
technical constructs designed for interoperability have yet to be
addressed. Some of the issues are due to the nascency of the virtual
asset industry and lack of conventions, and therefore require
industry collaboration to determine the standard conventions.
9.1. Global identification of blockchain systems and public-keys
There is currently no standard nomenclature to identify a DLT network
in a globally unique manner. The analog to this is the AS-numbers
associated with IP routing autonomous systems.
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Furthermore, an address (public-key) may not be unique to one DLT
network. An entity (e.g. user) may in fact employ the same public-
key simultaneously at multiple distinct DLT networks. Thus, there is
no convention today with regards to the application of a key within a
given DLT network (comparable to the principal/ domain convention in
Internet host naming).
However, in order to perform an asset transfer from one DLT network
to another, there needs to be mechanism that resolves the beneficiary
identifier (as known to the originator) to the correct public-key and
DLT network as intended by the originator.
9.2. Discovery of gateways in DLT Networks
A given DLT network must possess the capability to select or
designate gateway that will perform an asset transfer.
A number of DLT networks already employ consensus mechanisms that
elect a gateway to perform the transaction processing (e.g. proof of
stake in Ethereum). The same consensus mechanisms may be used to
elect the gateway (e.g. out of a pool of available gateways in the
DLT network).
9.3. Remote gateway discovery
Related to the ability to discover other DLT networks globally is the
ability to discover the remote gateways for these other DLT networks.
A discovery mechanism for external entities (e.g. for gateway G1) to
look for gateways (e.g. remote gateway G2) is required in order for
gateways to quickly and efficiently peer without human intervention.
The discovery mechanism may employ the available information at
gateway G1, such as the originator/beneficiary public keys, the VASPs
(owners of the gateways) and other parameters.
Other approaches may also be employed, such as incorporating the
gateway identities within a VASP's configuration file (e.g. at a
well-known location), and within a global directory of regulated
VASPs. Approaches similar to the DNS infrastructure may provide an
alternative architecture for solving this problem.
9.4. Commitment protocols and forms of commitment evidence
Within Phase 2, the gateways must implement one (or more)
transactional commitment protocols that permit the coordination
between two gateways, and the final commitment of the asset transfer.
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The choice of the commitment protocol (type/version) and the
corresponding commitment evidence must be negotiated between the
gateways during Phase 1.
For example, in Phase 2 and Phase 3 discussed above the gateways G1
and G2 may implement the classic 2 Phase Commit (2PC) protocol
[Gray81] as a means to ensure efficient and non-disputable
commitments to the asset transfer.
Historically, transactional commitment protocols employ locking
mechanisms to prevent update conflicts on the data item in question.
When used within the context of virtual asset transfers across DLT
networks, the fact that an asset has been locked by G1 (as the 2PC
coordinator) must be communicated to G2 (as the 2PC participant) in
an indisputable manner.
The exact form of this evidence of asset-locking must be standardized
(for the given transactional commitment protocol) to eliminate any
ambiguity.
10. Security Considerations
As a DLT network hold an increasing number of virtual assets, it may
become attractive to attackers seeking to compromise the
cryptographic keys of the entities, services and its end-users.
Gateways are of particular interest to attackers because they enable
the transferal of virtual assets to external DLT networks, which may
or may not be regulated. As such, hardening technologies and tamper-
resistant crypto-processors (e.g. TPM, SGX) should be used for
implementations of gateways [HS19].
11. Policy Considerations
Virtual asset transfers must be policy-driven in the sense that it
must observe and enforce the policies defined for the DLT network.
Resources that make-up a DLT network are owned and operated by
entities (e.g. legal persons or organizations), and these entities
typically operate within regulatory jurisdictions [FATF]. It is the
responsibility of these entities to translate regulatory policies
into functions on DLT networks that comply to the relevant regulatory
policies.
At the application layer, asset transfers must take into
consideration the legal status of assets and incorporate relevant
asset-related policies into their business logic. These policies
must permeate down to the gateways that implement the functions of
asset transaction processing.
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The smart contract abstraction, based on replicated shared code/state
on the ledger [Herl19], must additionally incorporate the notion of
policy into the abstraction.
12. References
12.1. Normative References
[BCH21] Belchior, R., Correia, M., and T. Hardjono, "DLT Gateway
Crash Recovery Mechanism, IETF, draft-belchior-gateway-
recovery-01.", March 2021,
<https://datatracker.ietf.org/doc/draft-belchior-gateway-
recovery/>.
[DLVIEW] Ramakrishna, V., Pandit, V., Nishad, S., Narayanam, K.,
and D. Vinayagamurthy , "Views and View Addresses for
Blockchain/DLT Interoperability, IETF Draft", November
2021.
[FATF] FATF, "International Standards on Combating Money
Laundering and the Financing of Terrorism and
Proliferation - FATF Revision of Recommendation 15
(Updated June 2021)", October 2018, <http://www.fatf-
gafi.org/publications/fatfrecommendations/documents/fatf-
recommendations.html>.
[ISO] ISO, "Blockchain and distributed ledger technologies-
Vocabulary (ISO:22739:2020)", July 2020,
<https://www.iso.org>.
[NIST] Yaga, D., Mell, P., Roby, N., and K. Scarfone, "NIST
Blockchain Technology Overview (NISTR-8202)", October
2018, <https://doi.org/10.6028/NIST.IR.8202>.
[ODAP] Hargreaves, M. and T. Hardjono, "Open Digital Asset
Protocol, IETF, draft-hargreaves-odap-01.", November 2020,
<https://datatracker.ietf.org/doc/draft-hargreaves-odap/>.
[RFC2119] Bradner, S., "Key words for use in RFCs to Indicate
Requirement Levels", BCP 14, RFC 2119,
DOI 10.17487/RFC2119, March 1997,
<https://www.rfc-editor.org/info/rfc2119>.
12.2. Informative References
[ABCH20] Ankenbrand, T., Bieri, D., Cortivo, R., Hoehener, J., and
T. Hardjono, "Proposal for a Comprehensive Crypto Asset
Taxonomy", May 2020, <https://arxiv.org/abs/2007.11877>.
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[Abebe19] Abebe, E., Behl, D., Govindarajan, C., Hu, Y.,
Karunamoorthy, D., Novotny, P., Pandit, V., Ramakrishna,
V., and C. Vecchiola, "Enabling Enterprise Blockchain
Interoperability with Trusted Data Transfer (Middleware
2019, Industry Track)", December 2019,
<https://arxiv.org/abs/1911.01064>.
[Abebe21] Abebe, E., Hu, Y., Irvin, A., Karunamoorthy, D., Pandit,
V., Ramakrishna, V., and J. Yu, "Verifiable Observation of
Permissioned Ledgers (ICBC2021)", May 2021,
<https://arxiv.org/abs/2012.07339>.
[BVGC20] Belchior, R., Vasconcelos, A., Guerreiro, S., and M.
Correia, "A Survey on Blockchain Interoperability: Past,
Present, and Future Trends", May 2020,
<https://arxiv.org/abs/2005.14282v2>.
[Clar88] Clark, D., "The Design Philosophy of the DARPA Internet
Protocols, ACM Computer Communication Review, Proc SIGCOMM
88, vol. 18, no. 4, pp. 106-114", August 1988.
[Gray81] Gray, J., "The Transaction Concept: Virtues and
Limitations, in VLDB Proceedings of the 7th International
Conference, Cannes, France, September 1981, pp. 144-154",
September 1981.
[Herl19] Herlihy, M., "Blockchains From a Distributed Computing
Perspective, Communications of the ACM, vol. 62, no. 2,
pp. 78-85", February 2019,
<https://doi.org/10.1145/3209623>.
[HLP19] Hardjono, T., Lipton, A., and A. Pentland, "Towards and
Interoperability Architecture for Blockchain Autonomous
Systems, IEEE Transactions on Engineering Management",
June 2019, <https://doi:10.1109/TEM.2019.2920154>.
[HS2019] Hardjono, T. and N. Smith, "Decentralized Trusted
Computing Base for Blockchain Infrastructure Security,
Frontiers Journal, Special Issue on Blockchain Technology,
Vol. 2, No. 24", December 2019,
<https://doi.org/10.3389/fbloc.2019.00024>.
[IDevID] Richardson, M. and J. Yang, "A Taxonomy of operational
security of manufacturer installed keys and anchors. IETF
draft-richardson-t2trg-idevid-considerations-01", August
2020, <https://tools.ietf.org/html/draft-richardson-t2trg-
idevid-considerations-01>.
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[SRC84] Saltzer, J., Reed, D., and D. Clark, "End-to-End Arguments
in System Design, ACM Transactions on Computer Systems,
vol. 2, no. 4, pp. 277-288", November 1984.
Authors' Addresses
Thomas Hardjono
MIT
Email: hardjono@mit.edu
Martin Hargreaves
Quant Network
Email: martin.hargreaves@quant.network
Ned Smith
Intel
Email: ned.smith@intel.com
Venkatraman Ramakrishna
IBM
Email: vramakr2@in.ibm.com
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