13. BLOCKCHAIN LEDGER
The ledger is built on a permissioned blockchain. Permission to mutate the ledger is facilitated by public key cryptography, utilizing the Ed25519 implementation of Edwards-curve Digital Signature Algorithm. See http://ed25519.cr.yp.to/ for details.
EdDSA consists of a key pair: a public and a secret key. The public key can be shared and is used to track permissions on the ledger. The secret key is used to sign transactions which correspond to the public key. Without knowledge of the secret key, no such signing is possible.
A signed transaction can be verified using just the public key, the transaction itself and the signature (i.e. without knowledge of the secret key).
Thus, to ensure that only authorized changes are done to the ledger, the public key(s) listed in the required permission for the change is checked against the signature(s) of the transaction.
The ledger permission structure is hierarchical with FXCH controlling the permissions of the hierarchy root, effectively giving FXCH sole authority to add new custodians and members.
(i) Account creation:
FXCH will provide the member with tools to generate a “member creation request” locally. This tool generates the public key and the corresponding secret key, which will only be known to the member. The creation request is signed with the secret key and submitted to FXCH for review.
The member is contacted by FXCH to voice verify the details of the request, most urgently the public key contained therein. This provides certainty that the creation request was created by the member and that the corresponding secret key is in the member’s possession.
Once approved, FXCH countersigns the request with its own secret keys and submits it to the ledger, at which point the member entity is effectively created.
(ii) Safe-keeping of the secret key
The member will be responsible for the safe-keeping of the secret key. FXCH will not be liable for any unauthorised access to the distributed-ledger signed by the secret key. A member may opt to strengthen the security of their ledger access by adding further public keys permissions which they have ownership of.
(iii) Cash only
All cash transactions will be reflected on the ledger but it may not reflect the member’s position at any given time. In order to access information regarding its total consolidated value at a specific time and date, the member should login to its account on FXCH portal.
-Standard of proof
- Errors (notification of contest, audit review, eventual amendment)