Granted Patent B2

US 11,704,733 · App. 15/396,030 · Granted Jul 18, 2023

Inventors: Alec Wilkins (Salt Lake City, UT); Robert Christensen (Sandy, UT); John Wesley Welborn (Arlington, VA); John Tabacco (Jersey City, NJ); Glen Nickle (Logan, UT)

Assignee: tZERO IP, LLC

G06Q40/04H04L9/0637H04L9/14H04L9/30H04L9/3236H04L9/3247G06Q2220/00H04L9/50H04L2209/56

Abstract

Claims (90)

1. A computer implemented cryptographic asset trading system comprising:

a processor; and

a memory communicatively coupled to the processor, the memory storing computer readable instructions that when executed by the processor causes the processor to:

receive a creation request (i) including a digital signature of a first cryptographic key associated with a first account and (ii) including a composition of at least one share of a fund, the composition of the at least one share of the fund including a respective quantity of each of a plurality of different assets in the at least one share of the fund;

in response to receiving the creation request:

place the respective quantity of each of the plurality of different assets represented by the at least one share of the fund into an escrow account associated with the computer implemented cryptographic asset trading system as collateral for a digital fund token serving as a digital representation of the fund;

create and transfer the digital fund token to the first account (i) by cryptographically signing with a second cryptographic key associated with the computer implemented cryptographic asset trading system and (ii) based on the respective quantity of each of the plurality of different assets, the digital fund token including the composition of the at least one share of the fund, the composition of the at least one share of the fund including the respective quantity of each of the plurality of different assets in the at least one share of the fund represented by the digital fund token; and

record the creation and transfer of the digital fund token to the first account on a distributed ledger thereby requiring cryptographic signing with the first cryptographic key associated with the first account to: (i) redeem the digital fund token from the first account or (ii) transfer the digital fund token from the first account to a second account;

receive a redemption request including the digital signature of the first cryptographic key associated with the first account; and

in response to receiving the redemption request:

release the plurality of different assets represented by the at least one share of the fund from the escrow account;

destroy the digital fund token; and

record the destruction of the digital fund token on the distributed ledger.

2. The asset trading system of claim 1 , wherein the instructions, when executed by the processor further causes the processor to:

in response to receiving the creation request and prior to creating the digital fund token:

receive confirmation from the distributed ledger that the plurality of different assets represented by the at least one share of the fund are associated with the first account.

3. The asset trading system of claim 1 , wherein the instructions, when executed by the processor further causes the processor to:

in response to receiving the creation request and prior to creating the digital fund token:

create a plurality of digital tokens representing the plurality of different assets; and

record the creation of the plurality of digital tokens on the distributed ledger; and

in response to receiving the creation request and as part of creating the digital fund token:

place the plurality of digital tokens representing the plurality of different assets into an escrow state; and

record the escrow state of the plurality of digital tokens representing the plurality of different assets on the distributed ledger.

4. The asset trading system of claim 1 , wherein the instructions, when executed by the processor further causes the processor to:

in response to receiving the redemption request and prior to destroying the digital fund token:

remove a plurality of digital tokens representing the plurality of different assets from an escrow state; and

record the removal of the plurality of digital tokens representing the plurality of different assets from the escrow state on the distributed ledger.

5. The asset trading system of claim 1 , wherein the instructions, when executed by the processor further causes the processor to:

receive a transfer request including the digital signature of the first cryptographic key associated with the first account; and

in response to receiving the transfer request:

transfer the digital fund token from the first account to the second account; and

record the transfer of the digital fund token from the first account to the second account on the distributed ledger.

6. The asset trading system of claim 1 , wherein place the respective quantity of each of the plurality of different assets represented by the at least one share of the fund into the escrow account as collateral for the digital fund token includes placing a quantity of at least one of an exchange traded fund, a mutual fund, an index fund, a bond fund, a commodity fund, a currency fund, and a real estate fund into the escrow account as collateral for the digital fund token.

7. A method comprising:

receiving, using at least one processor, a creation request (i) including a digital signature of a first cryptographic key associated with a first account and (ii) includes a composition of at least one share of a fund, the composition of the at least one share of the fund including a respective quantity of each of a plurality of different assets in the at least one share of the fund;

in response to receiving the creation request:

placing, using the at least one processor, the respective quantity of each of the plurality of different assets represented by the at least one share of the fund into an escrow account associated with a computer implemented cryptographic asset trading system as collateral for a digital fund token serving as a digital representation of the fund;

creating and transferring, using the at least one processor, the digital fund token to the first account (i) by cryptographically signing with a second cryptographic key associated with the computer implemented cryptographic asset trading system and (ii) based on the respective quantity of each of the plurality of different assets, the digital fund token including the composition of the at least one share of the fund, the composition of the at least one share of the fund including the respective quantity of each of the plurality of different assets in the at least one share of the fund represented by the digital fund token; and

recording, using the at least one processor, the creation and transfer of the digital fund token to the first account on a distributed ledger thereby requiring cryptographic signing with the first cryptographic key associated with the first account to: (i) redeem the digital fund token from the first account or (ii) transfer the digital fund token from the first account to a second account;

receiving, using the at least one processor, a redemption request including the digital signature of the first cryptographic key associated with the first account; and

in response to receiving the redemption request:

releasing, using the at least one processor, the plurality of different assets represented by the at least one share of the fund from the escrow account;

destroying, using the at least one processor, the digital fund token; and

recording, using the at least one processor, the destruction of the digital fund token on the distributed ledger.

8. The method of claim 7 , further comprising:

in response to receiving the creation request and prior to creating the digital fund token:

receiving, using the at least one processor, confirmation from the distributed ledger that the plurality of different assets represented by the at least one share of the fund are associated with the first account.

9. The method of claim 8 , further comprising:

in response to receiving the creation request and prior to creating the digital fund token:

creating, using the at least one processor, a plurality of digital tokens representing the plurality of different assets; and

recording, using the at least one processor, the creation of the plurality of digital tokens on the distributed ledger; and

in response to receiving the creation request and as part of creating the digital fund token:

placing, using the at least one processor, the plurality of digital tokens representing the plurality of different assets into an escrow state; and

recording, using the at least one processor, the escrow state of the plurality of digital tokens representing the plurality of different assets on the distributed ledger.

10. The method of claim 7 , further comprising:

in response to receiving the redemption request and prior to destroying the digital fund token:

removing, using the at least one processor, a plurality of digital tokens representing the plurality of different assets from an escrow state; and

recording, using the at least one processor, the removal of the plurality of digital tokens representing the plurality of different assets from the escrow state on the distributed ledger.

11. The method of claim 7 , further comprising:

receiving, using the at least one processor, a transfer request including the digital signature of the first cryptographic key associated with the first account; and

in response to receiving the transfer request:

transferring, using the at least one processor, the digital fund token from the first account to the second account; and

recording, using the at least one processor, the transfer of the digital fund token on the distributed ledger.

12. The method of claim 7 , wherein placing the respective quantity of each of the plurality of different assets represented by the at least one share of the fund into the escrow account as collateral for the digital fund token includes placing a quantity of at least one of an exchange traded fund, a mutual fund, an index fund, a bond fund, a commodity fund, a currency fund, and a real estate fund into the escrow account as collateral for the digital fund token.

13. A non-transitory computer-readable storage medium including a set of instructions that, when executed by a processor, cause the processor to:

receive a creation request (i) including a digital signature of a first cryptographic key associated with a first account and (ii) including a composition of at least one share of a fund, the composition of the at least one share of the fund including a respective quantity of each of a plurality of different assets in the at least one share of the fund;

in response to receiving the creation request:

place the respective quantity of each of the plurality of different assets represented by the at least one share of the fund into an escrow account associated with a computer implemented cryptographic asset trading system as collateral for a digital fund token serving as a digital representation of the fund;

create and transfer the digital fund token to the first account (i) by cryptographically signing with a second cryptographic key associated with the computer implemented cryptographic asset trading system and (ii) based on the respective quantity of each of the plurality of different assets, the digital fund token including the composition of the at least one share of the fund, the composition of the at least one share of the fund including the respective quantity of each of the plurality of different assets in the at least one share of the fund represented by the digital fund token; and

record the creation and transfer of the digital fund token to the first account on a distributed ledger thereby requiring cryptographic signing with the first cryptographic key associated with the first account to: (i) redeem the digital fund token from the first account or (ii) transfer the digital fund token from the first account to a second account;

receive a redemption request including the digital signature of the first cryptographic key associated with the first account; and

in response to receiving the redemption request:

release the plurality of different assets represented by the at least one share of the fund from the escrow account;

destroy the digital fund token; and

record the destruction of the digital fund token on the distributed ledger.

14. The non-transitory computer-readable storage medium of claim 13 , wherein the instructions, when executed by the processor, further cause the processor to:

in response to receiving the creation request and prior to creating the digital fund token:

receive confirmation from the distributed ledger that the plurality of different assets represented by the at least one share of the fund are associated with the first account.

15. The non-transitory computer-readable storage medium of claim 14 , wherein the instructions, when executed by the processor, further cause the processor to:

in response to receiving the creation request and prior to creating the digital fund token:

create a plurality of digital tokens representing the plurality of different assets; and

record the creation of the plurality of digital tokens on the distributed ledger; and

in response to receiving the creation request and as part of creating the digital fund token:

place the plurality of digital tokens representing the plurality of different assets into an escrow state; and

record the escrow state of the plurality of digital tokens representing the plurality of different assets on the distributed ledger.

16. The non-transitory computer-readable storage medium of claim 13 , wherein the instructions, when executed by the processor, further cause the processor to:

in response to receiving the redemption request and prior to destroying the digital fund token:

remove a plurality of digital tokens representing the plurality of different assets from an escrow state; and

record the removal of the plurality of digital tokens representing the plurality of different assets from the escrow state on the distributed ledger.

17. The non-transitory computer-readable storage medium of claim 13 , wherein place the respective quantity of each of the plurality of different assets represented by the at least one share of the fund into the escrow account as collateral for the digital fund token includes placing a quantity of at least one of an exchange traded fund, a mutual fund, an index fund, a bond fund, a commodity fund, a currency fund, and a real estate fund into the escrow account as collateral for the digital fund token.

Assignments (9)

Continuity (5)

Cited By (3)

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