Method and system for commodity-based currency for payment of accounts and elimination of payment risk

• US 5,671,364 A
• Filed: 06/05/1995
• Issued: 09/23/1997
• Est. Priority Date: 02/10/1993
• Status: Expired due to Term

• Current Assignee: Goldmoney Network Ltd.
• Original Assignee: James J. Turk
• Inventors: Turk, James J.
• Primary Examiner(s): Chin, Willington
• Assistant Examiner(s): Carman, Melissa Kay
• Application Number:
  US08/465,430
• Time in Patent Office: 841 Days
• Field of Search: 395/149, 395/600, 395/239, 395/201, 395/235, 364/408, 364/403, 364/401 R, 364/464.01, 340/825.35
• US Class Current: 705/39
• CPC Class Codes: G06Q 20/02 involving a neutral party, e.g. certification authority, notary or trusted third party [TTP]
• CPC Class Codes: G06Q 20/06 Private payment circuits, e.g. involving electronic currency used among participants of a common payment scheme
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/28 Pre-payment schemes, e.g. "pay before"
• CPC Class Codes: G06Q 20/29 characterised by micropayments
• CPC Class Codes: G06Q 20/403 Solvency checks

Abstract

A system and method for permitting gold or other commodities to circulate as currency requires a network of system users that participate in financial transactions where payment is made in units of gold. The gold is kept in secure storage at a deposit site for the benefit of the users. The payments in gold are effected through a computer system having data storage and transaction processing programs that credit or debit the units of account of gold held for the account of each system user.

Claims

1. An electronic commodity based system for conducting financial transactions, comprising:

at least one deposit site having secure facilities for storage of a commodity;

an inventory of a valuable commodity stored in said secure facilities at a said deposit site, said inventory including a quantity of units of said valuable commodity held at said deposit site for an account of at least one identified person;

a computer system for processing data for accounting transactions denominated in said units of said commodity, having

(a) an account data storage device for recording data comprising an identification of persons and a quantity of units of said commodity credited to said account of each of said persons and an identification of said deposit site where said units of commodity are held,

(b) a transaction data storage device for receiving records of transactions denominated in units of said commodity from a said person identified as having a quantity of said units of said commodity credited to said account of said person, said records of transactions including at least an identification of a person who will receive a debit, a person who will receive a credit, an amount of a debit of a quantity of said units of said commodity held at a deposit site, an amount of a credit of a quantity of said units of said commodity held at a deposit site, and an identification of the deposit site where said quantity of said units of said commodity are held,

(c) a transaction posting device for posting said records of transactions to said account data storage device to update said data comprising an identification of persons and a quantity of units of said commodity credited to said account of said persons at an identified deposit site;

a remote terminal located at said deposit site for receiving and sending data to said computer system, said data identifying a person and a quantity of units of said commodity held at said deposit site for an account of said person;

said electronic commodity based system permitting persons to conduct financial transactions without reliance on national currencies in conducting said financial transactions whereby obligations, of a person receiving a said debit of said units of said commodity held at a deposit site, to another person receiving a said credit of said units of said commodity held at a said deposit site, are extinguished upon posting of said records of transactions, thereby eliminating payment risk.

2. A system in accordance with claim 1 wherein said commodity comprises a precious metal.

3. A system in accordance with claim 2 wherein said precious metal comprises gold.

4. A system in accordance with claim 2 wherein said precious metal comprises silver.

5. A system in accordance with claim 3 wherein said gold is specified to a selected purity.

6. A system in accordance with claim 2 further comprising means for remote access to submit records of transactions to instantly debit and credit a person'"'"'s accounts.

7. A system in accordance with claim 6 further comprising verification means for verifying the identity of said person obtaining access to said computer system and for confirming that said person is authorized to submit records of transactions to said transaction storage device.

8. A system in accordance with claim 2 wherein said units of said commodity are designated as a payment for a futures contract of a different commodity.

9. An electronic gold based system for conducting financial transactions, comprising:

at least one deposit site having a protected vault;

an inventory of gold stored in said protected vault at a said deposit site, said inventory including a quantity of units of gold held at said deposit site for an account of at least one identified person;

a computer system for processing data for accounting transactions denominated in units of gold, having

(a) an inventory data storage device for recording data identifying an amount of gold stored at a said deposit site,

(b) an account data storage device for recording data comprising an identification of a person and a quantity of said units of gold stored at said deposit site credited to an account of said person,

(c) a verification means for verifying the identity of a person obtaining access to said computer system and for confirming that such person is authorized to submit records of transactions,

(d) a transaction data storage means for receiving, from a person obtaining access to said computer system, records of transactions denominated in said units of gold, said records of transactions including at least an identification of a person who will receive a debit, a person who will receive a credit, an amount of said debit in said units of gold, an amount of said credit in said units of gold, and an identification of the deposit site where said units of gold are located,

(e) a transaction posting means for posting said records of transactions to said account data storage device to update said data comprising an identification of a person and of a number of units of said gold held at a said deposit site for the account of the person;

a remote terminal located at said deposit site for receiving and sending data to said computer system, said data identifying a person and a quantity of units of gold held at said deposit site for an account of said person;

said electronic commodity based system permitting persons to conduct financial transactions without reliance on national currencies in conducting said financial transactions whereby obligations, of a person receiving a said debit of said units of said commodity held at a deposit site, to another person receiving a said credit of said units of said commodity held at a said deposit site, are extinguished upon posting of said records of transactions, thereby eliminating payment risk.

10. A system in accordance with claim 9 further comprising means for remote access to said computer system to submit and store records of transactions.

11. A system in accordance with claim 10 wherein said gold is of a selected purity.

12. A system in accordance with claim 9 wherein said gold units of account are designated as a required payment in a futures contract for a commodity other than gold.

13. A method of accounting, using a valuable commodity as a deposit currency, implemented by a computer system, comprising the steps of:

creating a deposit account data file for each of a plurality of persons, each said deposit account data file identifying a person, and a number of units of commodity stored at a deposit site for the benefit of the person;

entering records of transactions denominated in units of said commodity, said records of transactions including at least an identification of a person who will receive a debit, a person who will receive a credit, the amount of such debit in units of said commodity, the amount of such credit in units of said commodity, and the identity of the deposit site,

posting said records of transactions to debit and credit the deposit account data files of said persons to update said data identifying a number of units of said commodity held for the account of each said person;

said method permitting persons to conduct financial transactions without reliance on national currencies in conducting said financial transactions whereby obligations, of a person receiving a said debit of said units of said commodity held at a deposit site, to another person receiving a said credit of said units of said commodity held at a said deposit site, are extinguished upon posting of said records of transactions, thereby eliminating payment risk.

14. A method in accordance with claim 13 wherein said commodity comprises a precious metal.

15. A method in accordance with claim 14 wherein said precious metal comprises gold.

16. A method in accordance with claim 14 wherein said precious metal comprises silver.