An Interoperability Architecture for Blockchain/DLT Gateways

Document Type Active Internet-Draft (individual)
Authors Thomas Hardjono  , Martin Hargreaves  , Ned Smith 
Last updated 2021-04-20
Stream (None)
Intended RFC status (None)
Formats plain text pdf htmlized bibtex
Stream Stream state (No stream defined)
Consensus Boilerplate Unknown
RFC Editor Note (None)
IESG IESG state I-D Exists
Telechat date
Responsible AD (None)
Send notices to (None)
Internet Engineering Task Force                              T. Hardjono
Internet-Draft                                                       MIT
Intended status: Informational                             M. Hargreaves
Expires: October 23, 2021                                  Quant Network
                                                                N. Smith
                                                          April 21, 2021

      An Interoperability Architecture for Blockchain/DLT Gateways


   With the increasing interest in the potential use of blockchain
   systems for virtual assets, there is a need for these assets to have
   mobility across blockchain systems.  An interoperability architecture
   for blockchain systems is needed in order to permit the secure flow
   of virtual assets between blockchain systems, satisfying the
   properties of transfer atomicity, consistency and durability.  The
   architecture must recognize that there are different blockchain
   systems, and that the interior constructs in these blockchains maybe
   incompatible with one another.  Gateway nodes perform the transfer of
   virtual assets between blockchain systems while masking the
   complexity of the interior constructs of the blockchain that they

Status of This Memo

   This Internet-Draft is submitted in full conformance with the
   provisions of BCP 78 and BCP 79.

   Internet-Drafts are working documents of the Internet Engineering
   Task Force (IETF).  Note that other groups may also distribute
   working documents as Internet-Drafts.  The list of current Internet-
   Drafts is at

   Internet-Drafts are draft documents valid for a maximum of six months
   and may be updated, replaced, or obsoleted by other documents at any
   time.  It is inappropriate to use Internet-Drafts as reference
   material or to cite them other than as "work in progress."

   This Internet-Draft will expire on October 23, 2021.

Hardjono, et al.        Expires October 23, 2021                [Page 1]
Internet-Draft           Blockchain/DLT Gateways              April 2021

Copyright Notice

   Copyright (c) 2021 IETF Trust and the persons identified as the
   document authors.  All rights reserved.

   This document is subject to BCP 78 and the IETF Trust's Legal
   Provisions Relating to IETF Documents
   ( in effect on the date of
   publication of this document.  Please review these documents
   carefully, as they describe your rights and restrictions with respect
   to this document.  Code Components extracted from this document must
   include Simplified BSD License text as described in Section 4.e of
   the Trust Legal Provisions and are provided without warranty as
   described in the Simplified BSD License.

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.  Architecture  . . . . . . . . . . . . . . . . . . . . . . . .   7
     4.1.  Goal of Architecture  . . . . . . . . . . . . . . . . . .   7
     4.2.  Overview of Asset Transfer  . . . . . . . . . . . . . . .   8
     4.3.  Desirable Properties of Asset Transfer  . . . . . . . . .   9
     4.4.  Event log-data, crash recovery and backup gateways  . . .   9
     4.5.  Overview of the Phases in Asset Transfer  . . . . . . . .  10
   5.  Pre-transfer Verification of Asset and Identities (Phase 1) .  11
   6.  Evidence of asset locking or escrow (Phase 2) . . . . . . . .  13
   7.  Transfer Commitment (Phase 3) . . . . . . . . . . . . . . . .  15
   8.  Related Open Issues . . . . . . . . . . . . . . . . . . . . .  17
     8.1.  Global identification of blockchain systems and public-
           keys  . . . . . . . . . . . . . . . . . . . . . . . . . .  17
     8.2.  Discovery of gateways nodes within a blockchain system  .  18
     8.3.  Remote gateway discovery  . . . . . . . . . . . . . . . .  18
     8.4.  Commitment protocols and forms of commitment evidence . .  19
   9.  Security Considerations . . . . . . . . . . . . . . . . . . .  19
   10. Policy Considerations . . . . . . . . . . . . . . . . . . . .  19
   11. References  . . . . . . . . . . . . . . . . . . . . . . . . .  20
     11.1.  Normative References . . . . . . . . . . . . . . . . . .  20
     11.2.  Informative References . . . . . . . . . . . . . . . . .  21
   Authors' Addresses  . . . . . . . . . . . . . . . . . . . . . . .  22

Hardjono, et al.        Expires October 23, 2021                [Page 2]
Internet-Draft           Blockchain/DLT Gateways              April 2021

1.  Introduction

   Currently there is little technical interoperability between
   blockchain systems.  This results in the difficulty in transferring
   or migrating virtual assets associated with a public-key (address)
   from one blockchain or DLT system 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 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
   systems, and limits their scalability.

   This This document describes an architecture for gateways for
   blockchains and DLT systems that permit a direct transfer of assets
   without a mediating third party.  A given blockchain or DLT system
   may have one or more gateway nodes to perform a unidirectional direct
   transfer of virtual assets to blockchain or DLT system possessing one
   or more compatible gateway nodes.  Similar to the notion of border
   gateways in interdomain routing (e.g. running the BGPv4 protocol), a
   blockchain gateway belonging to an origin blockchain or DLT system is
   said to peer with another gateway is a destination blockchain or DLT
   system.  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 discuss the various aspects of a transfer
   between two gateways, including security aspects and transfer
   atomicity aspects.

2.  Terminology

   There following are some terminology used in the current document:

   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
      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

Hardjono, et al.        Expires October 23, 2021                [Page 3]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   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

   o  Resource Domain: Resource Domain: The collection of resources and
      entities participating within a blockchain or DLT system.  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 system.  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 system, and are not part of the operations of
      the system.  Examples include data located at third parties such
      as asset registries, ledgers of other blockchain/DLT systems, 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  Gateway nodes: The nodes of the blockchain or DLT system that are
      functionally capable of acting as a gateway in an asset transfer.
      A gateway node implements the gateway-to-gateway asset transfer
      protocol.  Being a node on the blockchain/DLT system, a gateway
      has read/write access to the interior resources (e.g. ledger) of
      the blockchain.  It participates in the consensus mechanism
      deployed for the system.  Depending on the blockchain/DLT system
      implementation, some or all of the nodes may be gateway-capable.

   o  Blockchain address: This is the public-key of an entity as known
      within a blockchain system, employed to transact on the blockchain
      network and recorded on the ledger of the blockchain.  Also
      referred to as the transaction public key.

   o  Entity public-key pair: This the private-public key pairs of an
      entity used for interactions outside the blockchain or DLT system
      (e.g.  TL1.3).  The term is used to distinguish this public-key
      from the blockchain address.

Hardjono, et al.        Expires October 23, 2021                [Page 4]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   o  Asset transfer protocol: The gateway-to-gateway technical protocol
      used by two gateway nodes to perform a unidirectional transfer of
      a virtual 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 blockchain or
      otherwise) and independent from its instance-ownership

   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].

   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
      node within a blockchain system.

   o  Passive transaction: A transaction aimed at recording some state
      metadata information on the ledger that does not affect assets
      recorded on the ledger.  A passive transaction can be self-
      addressed (or has null as destination address) and can be used to
      signal implicitly to other nodes regarding an state-change of the
      metadata pertaining to an entity or an asset on the ledger.

   o  Asset locking or escrow: The conditional mechanism used within a
      blockchain or DLT system to make an asset temporarily unavailable
      for use by its owner.  The condition of the asset release can be

Hardjono, et al.        Expires October 23, 2021                [Page 5]
Internet-Draft           Blockchain/DLT Gateways              April 2021

      based on a duration of time (e.g. hash time locks) or other

   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 interoperability architecture, and correspond to the design
   principles of the Internet architecture.

3.1.  Design Principles

   o  Opaque blockchain resources: The interior resources of each
      blockchain system 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
      node 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) blockchain
   systems 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
   autonomous systems.

   The value-externalization principle permits asset transfer protocols
   to be designed for efficiency, speed 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 blockchain systems 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.

Hardjono, et al.        Expires October 23, 2021                [Page 6]
Internet-Draft           Blockchain/DLT Gateways              April 2021

3.2.  Operational Assumptions

   The following conditions are assumed to have occurred, leading to the
   invocation of the asset transfer protocol between two gateway nodes:

   o  Application layer transfer request: The transfer request from an
      originator in the origin blockchain 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 blockchain: The origin
      and destination blockchain systems is assumed to have been

   o  Selection of gateway nodes: The two gateway nodes at the origin
      and destination blockchain systems respectively is assumed to have
      been identified and selected.

   o  Identification of gateway-node owners (VASP): The VASP operating
      the gateway nodes are assumed to have been identified and their
      legal status verified [FATF].

4.  Architecture

4.1.  Goal of Architecture

   The goal of the interoperability architecture is to permit two (2)
   gateway nodes belonging to distinct blockchain systems 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
   blockchains (double-spend problem).

   The virtual asset as understood by the two gateway nodes is a digital
   representation of value, expressed in an standard digital format in a
   way meaningful to the gateway nodes 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 blockchain systems.

   The architecture recognizes that there are different blockchain
   systems currently in operation and evolving, and that in many cases
   the interior technical constructs in these blockchains maybe
   incompatible with one another.

Hardjono, et al.        Expires October 23, 2021                [Page 7]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   The architecture therefore assumes that certain types of nodes
   (gateway nodes) will be equipped with an asset transfer protocol and
   with other relevant resources that permits greater interoperability
   across these incompatible blockchain systems.

   The resources within a blockchain system (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 systems.  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
   blockchain system that it represents.  Overall this approach ensures
   that a given blockchain system 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).

   For simplicity the current architecture employs two (2) gateway nodes
   in the respective blockchains, but collective multi-node transfers
   (i.e. multiple nodes at each side) [HS2019] may be developed based on
   the building blocks and constructs identified in the current

4.2.  Overview of Asset Transfer

   An asset transfer between two blockchain systems is carried out by
   two (2) gateway nodes in a direct interaction (unmediated), where the
   gateway represents the two respective blockchain systems.

   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 system.  The task of the
   respective gateway is to implement the relevant mechanism to modify
   the ledger of their corresponding blockchain system in such a way
   that together the two blockchains maintain consistency from the asset
   perspective, while observing the design principles of the

   An asset transfer protocol that can satisfy the properties of
   atomicity and consistency in the case of two private blockchain

Hardjono, et al.        Expires October 23, 2021                [Page 8]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   systems, should also satisfy the same properties in the case when one
   or both are public blockchain systems.

4.3.  Desirable Properties of Asset Transfer

   The desirable features of asset transfers between two gateway nodes
   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 both
      blockchains in a consistent state (asset located in the ledger of
      one blockchain 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
      respective ledgers for asset transfers across the corresponding
      blockchain systems.

   o  Containment of side-effects: Any effects due to errors or
      security/integrity breaches in a blockchain system during an asset
      transfer must be contained within that blockchain.

   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.

4.4.  Event log-data, crash recovery and backup gateways

   Implementations of gateway nodes 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 gateway nodes within the same
   blockchain system

   Mechanisms used to select or elect a gateway node in a blockchain
   system for a given asset transfer could be extended to include the
   selection of a backup gateway node.  The primary gateway and the
   backup gateway may or may not belong to the same owner (VASP).

Hardjono, et al.        Expires October 23, 2021                [Page 9]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   Some blockchain systems may utilize the ledger itself as means to
   retain the log-data, allowing other nodes in the blockchain to have
   visibility and access to the gateway log-data.  Other blockchain
   systems may employ off-chain storage that is accessible to all
   gateway nodes in the blockchain domain.  In such cases, to provide
   event-sequencing integrity the gateway may store a hash of the log-
   data on the ledger of the blockchain (passive transaction) prior to
   writing the log-data to the off-chain storage.

   The mechanism used to provide gateway crash-recovery is dependent on
   the blockchain system 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 node recovery strategy (e.g. self-healing,
   primary-backup node, 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)
   must be established netween the two gateways nodes, 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 node acts also as a checkpoint
   mechanism to assist the recovered (or backup) gateway node 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 gateway nodes may choose
   to start afresh the transfer of the asset, and not to resume
   partially completed transfers (e.g. for easier legal audit purposes).

4.5.  Overview of the Phases in Asset Transfer

   The interaction between two gateways in an asset transfer is
   summarized in Figure 1, where the origin blockchain is B1 and the
   destination blockchain is B2.  The gateways are denoted as G1 and G2

Hardjono, et al.        Expires October 23, 2021               [Page 10]
Internet-Draft           Blockchain/DLT Gateways              April 2021

      |   Client    |
             |                   Phases
      +-------------+       |<-----(1)----->|       +-------------+
      | Blockchain  |  +----+               +----+  | Blockchain  |
      | System B1   |  |Gate|               |Gate|  | System B2   |
      |             |--|way |<-----(2)----->|way |--|             |
      | +---------+ |  | G1 |               | G2 |  | +---------+ |
      | |Ledger L1| |  +----+               +----+  | |Ledger L2| |
      | +---------+ |       |<-----(3)----->|       | +---------+ |
      +-------------+                               +-------------+

                                 Figure 1

   The three phases are summarized as follows.

   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, and that consent have been
      obtained from the beneficiary regarding accepting the transfer.

   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 blockchain B1 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.

5.  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 identities
   of the originator and beneficiary, the identity and legal status of
   the entities (VASPs) who own and operate the gateways, the blockchain

Hardjono, et al.        Expires October 23, 2021               [Page 11]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   or DLT system type and network parameters, and the device-identities
   of the gateways.

      Orig   L1          G1                   G2           L2  Benef
      |     |            |                    |            |     |
      |---request------->|                    |            |     |
      |     |            |                    |            |     |
      |     |            |       Phase 1      |            |     |
      |     |            |                    |            |     |
      |     |       (1.1)|<-----VASP id------>|            |     |
      |     |            |                    |            |     |
      |     |            |                    |            |     |
      |     |       (1.2)|<--Asset Profile--->|            |     |
      |     |            |                    |            |     |
      |     |            |                    |            |     |
      |     |       (1.3)|<--Orig/Benef id--->|            |     |
      |     |            |                    |            |     |
      |     |            |                    |            |     |

                                 Figure 2

   This phase starts with the assumption that in blockchain B1 the
   gateway to process the asset transfer to B2 has been selected (namely
   gateway G1).  It also assumes that the destination blockchain B2 has
   been identified where the beneficiary address is located, and that
   gateway G2 in blockchain B2 has been identified that will peer with
   G1 to perform the transfer.

   There are several steps that may occur in Phase 1 (see Figure 2):

   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.

Hardjono, et al.        Expires October 23, 2021               [Page 12]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   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.

   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
      the blockchain B2 to digitally represent the asset type within its
      ledger L2.  The policies governing blockchain B2 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].

6.  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 3, 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

Hardjono, et al.        Expires October 23, 2021               [Page 13]
Internet-Draft           Blockchain/DLT Gateways              April 2021

      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
      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.  The lock may
      take the form of passive transaction that signals to other nodes
      that the asset is temporarily inaccessible.  This signals to other
      nodes in the blockchain system to ignore other transactions
      pertaining to the asset 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 blockchains B1 and B2 in
      question (e.g. account-based, UTXO, or other).

   o  G2 log 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 standing
      behind the 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.

Hardjono, et al.        Expires October 23, 2021               [Page 14]
Internet-Draft           Blockchain/DLT Gateways              April 2021

      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 3

   The precise form of the evidence in step 2.5 is dependent on the
   blockchain system in B1, 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.

7.  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 4):

Hardjono, et al.        Expires October 23, 2021               [Page 15]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   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

   o  Lock-final (3.3): Gateway G1 issues a lock-finalization
      transaction (passive transaction) or escrow finalization on ledger
      L1 that signals the permanent extinguishment of the asset
      blockchain B1.  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, using a passive transaction.  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.

Hardjono, et al.        Expires October 23, 2021               [Page 16]
Internet-Draft           Blockchain/DLT Gateways              April 2021

      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 4

8.  Related Open Issues

   There are a number of open issues that are related to the asset
   transfer protocol between gateway nodes.  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.

8.1.  Global identification of blockchain systems and public-keys

   There is currently no standard nomenclature to identify blockchain
   systems in a globally unique manner.  The analog to this is the AS-
   numbers associated with IP routing autonomous systems.

Hardjono, et al.        Expires October 23, 2021               [Page 17]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   Furthermore, an address (public-key) may not be unique to one
   blockchain system.  An entity (e.g. user) may in fact employ the same
   public-key at multiple distinct blockchain systems simultaneously.
   Thus, there is no convention today with regards to the application of
   a key within a given blockchain system (comparable to the principal/
   domain convention in Internet host naming).

   However, in order to perform an asset transfer from one blockchain
   system to another, there needs to be mechanism that resolves the
   beneficiary identifier (as known to the originator) to the correct
   public-key and blockchain system as intended by the originator.

8.2.  Discovery of gateways nodes within a blockchain system

   A given blockchain system must possess the capability to select or
   designate gateway nodes that will perform an asset transfer across
   blockchain systems.

   A number of blockchain systems already employ consensus mechanisms
   that elect a node to perform the transaction processing (e.g. proof
   of stake in Ethereum).  The same consensus mechanisms may be used to
   elect the gateway node.

   However, there are some blockchain systems that do not elect a single
   node and which employ a race-to-process strategy (e.g. proof of work
   in Bitcoin).  Since the winner of the proof of work can be any node
   in the blockchain system, this implies that all the nodes in these
   types of blockchains must be gateway-capable.

8.3.  Remote gateway discovery

   Related to the ability to discover other blockchain/DLT systems
   globally is the ability to discover the remote gateways for these
   other blockchain/DLT systems.  A discovery mechanism for external
   entities (e.g. for gateway G1) to look for gateway-capable nodes
   (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.

Hardjono, et al.        Expires October 23, 2021               [Page 18]
Internet-Draft           Blockchain/DLT Gateways              April 2021

8.4.  Commitment protocols and forms of commitment evidence

   Within Phase 2, the gateway nodes must implement one (or more)
   transactional commitment protocols that permit the coordination
   between two gateways, and the final commitment of the asset transfer.

   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
   blockchain systems, 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

9.  Security Considerations

   Although the current interoperability architecture for blockchain
   gateways assumes the externalization of the value of assets, as a
   blockchain system holds an increasing number of virtual assets it
   becomes attractive to attackers seeking to obtain cryptographic keys
   of its nodes and its end-users.

   Gateway nodes are of particular interest to attackers because they
   enable the transferal of virtual assets to external blockchain
   systems, 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].

10.  Policy Considerations

   Virtual asset transfers must be policy-driven in the sense that it
   must observe and enforce the policies defined for the blockchain
   domain.  Resources that make-up a blockchain systems 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

Hardjono, et al.        Expires October 23, 2021               [Page 19]
Internet-Draft           Blockchain/DLT Gateways              April 2021

   policies into functions on blockchain systems 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 nodes that implement the functions of asset
   transaction processing.

   The smart contract abstraction, based on replicated shared code/state
   on the ledger [Herl19], must additionally incorporate the notion of
   policy into the abstraction.

11.  References

11.1.  Normative References

   [BCH21]    Belchior, R., Correia, M., and T. Hardjono, "DLT Gateway
              Crash Recovery Mechanism, IETF, draft-belchior-gateway-
              recovery-01.", March 2021,

   [FATF]     FATF, "International Standards on Combating Money
              Laundering and the Financing of Terrorism and
              Proliferation - FATF Revision of Recommendation 15",
              October 2018, <http://www.fatf-

   [ISO]      ISO, "Blockchain and distributed ledger technologies-
              Vocabulary (ISO:22739:2020)", July 2020,

   [NIST]     Yaga, D., Mell, P., Roby, N., and K. Scarfone, "NIST
              Blockchain Technology Overview (NISTR-8202)", October
              2018, <>.

   [ODAP]     Hargreaves, M. and T. Hardjono, "Open Digital Asset
              Protocol, IETF, draft-hargreaves-odap-01.", November 2020,

   [RFC2119]  Bradner, S., "Key words for use in RFCs to Indicate
              Requirement Levels", BCP 14, RFC 2119,
              DOI 10.17487/RFC2119, March 1997,

Hardjono, et al.        Expires October 23, 2021               [Page 20]
Internet-Draft           Blockchain/DLT Gateways              April 2021

11.2.  Informative References

   [ABCH20]   Ankenbrand, T., Bieri, D., Cortivo, R., Hoehener, J., and
              T. Hardjono, "Proposal for a Comprehensive Crypto Asset
              Taxonomy", May 2020, <>.

   [BVGC20]   Belchior, R., Vasconcelos, A., Guerreiro, S., and M.
              Correia, "A Survey on Blockchain Interoperability: Past,
              Present, and Future Trends", May 2020,

   [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,

   [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,

   [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, <

   [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.

Hardjono, et al.        Expires October 23, 2021               [Page 21]
Internet-Draft           Blockchain/DLT Gateways              April 2021

Authors' Addresses

   Thomas Hardjono


   Martin Hargreaves
   Quant Network


   Ned Smith


Hardjono, et al.        Expires October 23, 2021               [Page 22]