Offline Wallets
Offline wallets are the payer component in resilient payment systems, allowing users and merchants to initiate and sign out resilient payments securely. In peer-to-peer scenarios, offline wallets acts also as the receiving components, enabling consecutive offline payments. Crunchfish Digital Cash Offline Wallet is a secure and scalable component that executes within a Virtual Secure Element providing a software-based isolated runtime execution environment.
Survivability in the Face of Failure:
Offline payments ensure economic resiliency by enabling transactions to occur even in environments with no or unreliable internet or service connectivity. From rural merchants in remote areas to urban customers impacted by network or service disruptions, the ability to perform offline transactions is rapidly becoming an essential feature of modern financial ecosystems.
Despite their growing importance, current offline payment systems face several challenges:
Double spending is an inevitable security risk of offline payments.
Particularly evident in solutions requiring hardware-based secure elements for wallets and terminals, as no efficient ecosystem exists for large-scale application deployment and upgrades.
The widespread reliance on Fund, Pay, Defund, and Reconcile (FPDR) models introduces adjunct layers that require separate reconciliation frameworks, complicating adoption.
Recognizing these limitations, Crunchfish has engineered a modular offline payment system combining interoperability, security, and scalability into a streamlined architecture that may be integrated with any type of underlying payment scheme.
Interoperable Offline Wallets
Offline wallets are the payer component, allowing users to initiate and sign offline transactions securely. In peer-to-peer payment scenarios, offline wallets acts also as receiving components, enabling consecutive offline payments. Crunchfish Digital Cash Offline Wallet is a secure and scalable component that executes within a Virtual Secure Element providing an isolated runtime execution environment.
Crunchfish Digital Cash Offline Wallets supports various other proximity interaction methods (NFC, Bluetooth, Ultrasound), catering to different use cases and ensuring broad compatibility. The QR-based interaction method is highlighted below for its effectiveness in accommodating low-end devices and as a reliable backup system.
Wallet-to-Wallet:
The payer displays a QR code representing their offline wallet transaction, which the payee scans to complete the payment.
Wallet-to-Terminal:
A merchant or payee presents a QR code with a payment request, which is scanned by the payer. The payer generates the offline transaction and displays a QR code representing their offline wallet transaction, which the payee scans to complete the payment.
Offline Payment Demos
Proximity Offline Payments
Using QR
Using QR and Bluetooth
Using QR and ultrasound
Using NFC and Bluetooth
Consecutive offline payment
Using QR and Face ID
Remote Offline Payments
Using telecom
Offline Wallets in Secure Elements
Whether using a software-based virtual secure element, a trusted execution environment (TEE) or an embedded secure chip, offline wallets must at least guarantee isolated runtimes and encrypted storage for sensitive data at rest.
However, operational challenges are present for large-scale deployment of hardware-based solutions, including monitoring, upgrades, and compliance.
Offline Wallet Communication
The architecture enables offline wallets, offline terminals, and the backend servers to communicate in a standardized way across multiple proximity and remote APIs, including:
- Proximity Mechanisms: NFC, QR, Bluetooth or ultra-sound for offline interactions.
- Remote APIs: Wallet and backend communication when partial connectivity is available.
The PKI framework ensures data end to end security across all communication channels, enforcing the same standards
Offline Payments in an Online World
The Reserve, Pay, and Settle approach augments any payment network by leveraging online settlement of Digital IOUs rather than relying on adjunct reconciliation of offline payments. The modularity of this unique approach combines the issuing and acquiring separation found in EMVCo card payments with the programmable flexibility of Ethereum smart contracts, delivering a comprehensive framework for secure, interoperable and resilient payments.
The Reserve, Pay, and Settle approach optimizes offline payments by leveraging existing rails rather than relying on separate reconciliation layers:
Pre-authorizing funds ensures trust without immediate backend connectivity.
Enable secure offline transactions validated by terminals.
Offline transactions are reconciled through online settlement structures, preventing fraud and enhancing efficiency.
E-Wallets must become much more resilient:
Seamless payment applications working online as well as offline
The generalization of offline wallets with the operational capabilities of standard Real-Time Payment eWallets presents a transformative approach to initiating payments. By leveraging the e-Wallets convenience, and accessibility, offline wallets can provide essential functionalities for users, mirroring the reliability of online payment methods.
Crunchfish technology enable client applications to be trusted offline as well as implementing or improving authentication security for online payments using Crunchfish’s patented offline payment solution with online settlement and patent-pending Trusted Application Protocol (TAP). In a world where connectivity is not always guaranteed, offline wallets stand to bridge the gap, enabling users to engage in digital transactions smoothly, irrespective of their location or connectivity status. This evolution not only broadens the reach of digital payments, but also fortifies financial inclusion on a global scale.
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