DE102021006441A1 - TECHNICAL PROCEDURE FOR TRADING IN FINANCIAL PRODUCTS WITH THE SAME USER EXPERIENCES AS IN A LOTTERY WHICH CAN BE IMPLEMENTED THROUGH HARD- AND SOFTWARE - Google Patents

Abstract

A technical method for creating a lottery based on financial instruments is disclosed. The lottery is not a game of chance, but the realization of financial transactions processed sequentially or in parallel, which can be selected by customers. Different representations of the lottery tickets or tickets are shown. The entire process, including the technical steps, is also shown in full. Furthermore, a vending machine for accepting such tickets and bills will be presented.

Description

The field of invention is the technical implementation of processes in the financial industry.

Background of the invention and prior art

A lottery is a special type of game of chance in which a certain number of fields can be selected from a given field of numbers. Later, the same number of squares are randomly drawn from the same number field - everyone who drew the same numbers wins. Numbers, symbols, words or other objects serve as fields. In many countries, private lottery games are regulated by the state because they can also generate large state revenues. People play lottery games both for fun and for the hope of getting rich.

Another industry that helps worldwide to achieve monetary gains is the financial industry. The financial industry is one of the most important parts of the economy and consists of services from a wide variety of applications that have money management in common. In detail, these are credit unions, banks, credit card companies, insurance companies, accounting firms.

The entire branch of industry is mainly based on financial instruments - these are (monetary) contracts between (at least) two parties. Therefore, these can be recreated (as a recomposition of various existing contracts), traded and modified (restructured). This can be cash (e.g. currency), proof of ownership (stock/share), an interest in a company or a contractual right to receive or deliver tangible and intangible goods (e.g. currency, debt, bonds, loans, stocks, derivatives). In the International Accounting Standards (IAS 32 and 39), financial instruments are defined as "any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity". Financial instruments can be divided into securities, other cash (instruments whose value is directly determined by the market), exchange-traded derivatives and over-the-counter (OTC) derivatives. Derivatives are instruments whose price is determined from the values or characteristics of one or more underlying entities (e.g. assets, indices or interest rates). Derivatives can also be divided into asset classes such as debt (long-term/short-term), equity and foreign exchange. Examples of financial instruments are bonds, loans, bonds, futures, options on bonds, futures, interest rate swaps, interest rate caps, exotic derivatives, stock options, currency futures and many more.

In terms of trading volume, the foreign exchange market (forex, fx or currency market) is by far the largest market in the world. The main players in this market are large financial institutions operating at different levels. Most of the players are banks, which trade large amounts of the currencies over-the-counter - this is known as the interbank market. By using leverage products, you can speculate with very large assets (and thus the chance to earn a lot of money and the risk of losing a lot of money) with a relatively small investment. Instruments such as binary options, derivatives, knock-out certificates, turbos and many more are also available for high-risk speculation.

Another important function of the financial industry is financial transaction. This is defined as an agreement between the buyer and seller to exchange a good for a payment.

Task of the invention

The object of this invention was to develop technical methods with the help of which it is possible for end users to trade financial instruments easily in the same way as they can take part in a lottery. This invention solves this problem.

Summary of the Invention

Drawing 1 shows a simplified representation of the interaction between a customer and the broker. A broker (102) is aimed at small (private) customers instead of large customers. A single person is regarded as a private customer (100). The private customer (100) can buy financial products such as stocks, options, derivatives and other tradable products through a broker (102). The broker (102) has better access to the financial industry and can place the orders (buy/sell) of its customers (100) on an exchange (104) or with any other securities dealer (106). Through this, the broker has access to automated trading systems (ATS - 108) or large, institutional brokers (110). The representation is divided into two overlapping areas (112) and (114). Area 114 highlights the interaction between the customer and the broker, while area 112 shows the interaction between the broker and the financial markets or industry. In the customer/broker interaction area (114) all activities between the customer (100) and the broker (102) are carried out. The Broker/Fi The financial industry interaction domain (112) represents the routing of customers' transactions from the broker (102) through larger financial institutions. The domain of the customer/broker relationship (114) is central to this invention. The terms ticket, note and ticket are equivalent in this disclosure. Likewise the term financial instrument and financial transaction. The invention is mainly based on the business method described below, which was technically implemented: a customer can select financial products from a specially prepared graphical interface. This can be a simple list in which numbers are selected. The financial instruments can also be selected by choosing from symbols, images or words. The selected financial products are processed sequentially (or in parallel) by a broker. The client's money is used to purchase the first financial instrument. After a defined time (most likely one day) the financial product is automatically sold and the next financial product is bought. This is repeated until the list of financial products to be purchased has been completed or the customer's financial commitment has been used up (i.e. if the previous financial products had generated a negative return). If high-risk financial products have been chosen, the customer must be protected so that he can only lose the total amount invested (due to regulations). If the customer has selected the right financial instruments at the right time and is willing to take a high risk, he can win a lot like a lottery, but the chance of winning a lottery is significantly lower. The business model is then based on a commission when purchasing a combination of financial instruments. However, wages, financial service providers, brokers, marketing and last but not least wages must also be paid from this commission.

character list

• Drawing 1 shows a simplified representation of the interaction between the end customer, the broker and the financial institution.
• Drawing 2 shows the user experience of an end customer in relation to this business model.
• Drawings 3A-E show five different types of customer interfaces for the selection of financial products (the purchase of tickets).
• Drawings 4A-D show different ways a ticket can be processed. Drawing 5 shows the business model in a sequential process.
• Drawing 6A shows the overall process.
• Drawing 6B shows the customer interface in 6A was used from the point of view of an end customer.
• Drawing 7 shows the complete technical implementation of an application system that can provide the necessary functions for the customers. Drawing 8A-C shows the implementation of the business model using physical ticket machines.
• Drawing 9 shows a technical representation with a customer interface of the ticket machine.

Reference List

100

end customer

102

brokers

104

stock exchange

106

Market Makers

110

Institutional broker

108

Automated trading system

114

The customer/broker interaction area

112

The Broker/Financial Market; Industry - area

200

Marked instruments / number

202

Unmarked instruments / number

204

ticket

208

Financial product represented by symbol 12

210

Financial product represented by symbol 15

212

View of the selected financial products

214

Two-dimensional matrix

300

Ticket, which uses ticker symbols in addition to its number

302

Ticket which ticker symbol uses

304

Ticket represented by mahjong symbols

308

Ticket me non-exchangeable financial products (selection is predefined)

400

A sequential list of different financial products/transactions

402

A sequential list of different financial products/transactions with time intervals between executions

406

The result of processing a sequential list of financial products

420

Flow chart of a financial transaction

422

Customized view of financial instruments

424

Financial instruments flowchart

426

Duration

428

Shorter term

500

timeline

502

Customer request of a ticket

504

ticket

506

Completed ticket

508

Processing the first transaction of the ticket

510

Result of the first transaction

512

Processing the second transaction of the ticket

514

Result of the second transaction

516

Process the third transaction of the ticket

518

Result of the third transaction

520

Processing the fourth transaction of the ticket

522

Result of the fourth transaction

524

Processing the fifth transaction of the ticket

526

Result of the fifth transaction

528

Processing the sixth transaction of the ticket

530

Result of the sixth transaction

540

Processing the seventh transaction of the ticket

542

Result of the seventh transaction

544

Grand total of the ticket

600

customer

602

web servers

604

Internet connection

606

Mobile device with internet connection

608

Software interface or other electronic interface

610

Graphical interface displayed on a mobile device

700

financial intermediary

704

Technical process within the server application

706

API (programming interface)

708

web service

710

Web GUI (graphical interface displayed in a browser)

712

website

718

payment service provider

720

Step AA Customer requests a ticket

722

Step BB ticket is generated

724

Customer fills out a ticket and starts the transactions

726

Step XX represents the outcome of the ticket

728

Step YY customer requests payment of his credit

730

Step ZZ Payment of the credit to the customer

732

Crypto wallet or Crypto payment service provider

734

Crypto web service

750

Transaction process / flow / machine

800

personal computers

802

Ticket vending machine

806

tablet PC

810

buyer

812

ticket

814

Salesperson

900

Coin/note slot

902

Input keys for customer interaction

904

Credit card reader

906

Mobile payment service

908

Coin/note slot

910

Coin/note issue

912

Display/Advertisement

920

Printer

930

ticket scanner

Detailed description of the invention based on three embodiments

Example 1 - Drawing 1 to 5

Drawings 1 to 5 show the underlying process.

Drawing 1 was explained at the beginning.

Drawing 2 shows a customer's user experience in relation to this invention: A ticket (204) is exchanged (100) between broker (102) and customer. It looks something like a lottery ticket. The ticket (204) is divided into two parts - in the first part there is a two-dimensional matrix (214) representing numbers (202) which can be selected by marking them with a pen (200). The second part of the ticket is on the right and represents the selected instruments (212). There are three panels with different symbols representing financial instruments. The instrument with number 12 from the selection matrix (214) represents the financial instrument XC000... (208). Number 15 represents the next financial instrument SB1PBK (210), etc. The ticket contains three two-dimensional matrices (214) and also three viewports (212) for the selected financial products. For this reason, the same number of financial products (here their ticker symbols) can be found in the view of the selected financial products as the numbers selected in the matrices.

Drawing 3 (A, B, C, D, E) shows five different screen displays (GUIs) or user experiences for the selection of tickets. Drawing 3A shows the ticket from drawing 2 (204). Drawing 3B shows the number and ticker symbol combined in the same selection field (300). Drawing 3C shows tickets in which only the ticker symbols (302) are represented in a two-dimensional matrix. Drawing 3D uses Mahjong Symbols (304) for display. Drawing 3E shows a pre-filled (with a random selection) ticket. The numbers here also represent financial instruments. The selection can no longer be changed (308).

Drawing 4A explains the interaction between broker and customer. The customer (100) submits a ticket (list of financial products) (102) for processing. The broker then works the ticket by placing orders on the exchange (104) or through other market makers (106).

Drawing 4B shows a sequential list of financial transactions (400). The first line shows the number of the financial instrument (from the point of view of the processing sequence), the second line shows the associated financial product or the transaction type. The letters A, B, C, ..., G are placeholders for financial instruments.

Drawing 4C shows the sequential processing of a list of financial products (402). The table (406) shows the order. The upper graph (402) represents the financial products and the time interval between each execution. In this example, there is a time interval between the execution of financial transactions A and B of one day; between financial transaction D and E a time interval of 16 hours. The second line of the table shows the result of individual transactions and aggregates them - the final result (the unit could be either a currency or in a virtual currency and is hereinafter referred to as a monetary unit) is presented in column F (final result is 4090 monetary units). In the beginning everything starts with 10 monetary units (1). After transaction A (this means buying a specific financial instrument with a holding period of 1 day and then selling it), the balance is 5 monetary units. These 5 monetary units are then used for transaction B and increase the credit to 15 monetary units after the sale. After working all transactions, the total result is a balance of 4090 monetary units.

Drawing 4D shows a flowchart for the execution of financial transactions in time (420). Some of the transactions are executed in parallel here (financial transactions C, D, E and F). In order to give the user (300) control over the parallelization, the graphical user interface from Drawing 4D would have to be revised. The representation of the selection of the selected financial transactions (424) is represented by a flow chart (422) in which the numbers of the financial transactions and the time intervals are shown (426 and 428). The financial instruments can again be selected by selecting numbers/fields in a two-dimensional matrix (300) - each column is executed in parallel, sequential execution is presented from left to right - the client can graphically display his selection in the right-hand panel ( 422). By placing the numbers relative to each other, holding periods or distances between transactions could also be defined. The gap between two financial transactions represents the holding period or distance - eg two space units (426) for two days, one space unit (428) for 16 hours.

Drawing 5 shows the interaction between customer and broker as a sequence diagram. The dotted lines show the stakeholders involved (customer (100), broker (102), exchange (104), market maker (106) and ATS (108)). The interaction starts with the purchase (502) of a ticket by the customer (100) from the broker (102). The broker issues an empty ticket (504). The ticket lists the available financial transactions (see Drawings 2,3 and 4). The customer fills out the ticket by selecting or arranging the numbers, symbols or ticker symbols (506) and submits it to the broker (102). The broker (102) then starts processing the ticket with the first transaction (508). For this purpose, the broker (102) transmits the order to an exchange (104). After the transaction has ended (sale of the financial product), the result/payment (510) is transmitted back to the broker (102). This then starts the next transaction (512). This is repeated until all transactions from the ticket have been processed (542). Finally, the final score of the ticket is sent to the customer (544). One of the transactions (516) is performed (108) by an automated trading system (ATS) - this allows intelligent orders or transactions to be used as well. Two of the transactions (512 and 528) were executed through a market maker instead of an exchange.

Descriptions of drawings 1 to 5

The business model works as follows: an end customer (100) - in this example an individual - wants to try his luck with financial productions or financial transactions. He gets a ticket (204). Which consists of a two-dimensional matrix (214). Each cell of the matrix represents an available financial instrument. Instead of selecting them, they can also be arranged similar to a flowchart (420). Likewise, intelligent transactions can also be selected (these are then executed by an automated trading system - e.g. buying a stock option on Microsoft with maximum lifting on a certain date). In addition, it is also possible to act event-based between two tickets instead of a certain holding period (e.g. if a transaction increases extremely strongly, it should be held longer).

The ticket with all selected transactions is then executed sequentially (402) or in a defined sequence (420) by a broker (100). The process is usually divided into sequential sub-processes. The overall result is then transmitted to the customer (544). Furthermore, pre-filled tickets can also be used (920) - similar to random lottery numbers. The customer (100) then only has to buy one ticket and can trade financial products directly. For the tickets, at least the amount to be used is required for meta information. In addition, a risk controller, for example, is useful and easy to implement.

Example 2 - Drawing 6 to 7

• Zeichnung 6A zeigt einen Kunden (600) der ein mobiles Gerät (606), welches mit dem Internet (604) verbunden mit einem Server (602) verbunden ist, benutzt (604). Der Server auf welchem die Softwareimplementierung ausgeführt wurde ist durch Schnittstellen (608) mit Market Makern (106), Automated Trading Systems (ATS) (108) und Börsen (104) verbunden. Zeichnung 6B zeigt die Benutzeroberfläche (entweder Webseite oder App) die auf einem mobilen Endgerät dargestellt wird (606). Die Oberfläche zeigt eine zweidimensionale Matrix auf der linken Seite für die Auswahl von Finanzprodukten und auf der rechten Seite eine Übersicht über die bereits ausgewählten Finanzprodukte. Die technische Implementierung wird in den Zeichnungen 3 und Zeichnung 4D beschrieben und funktioniert wie vorrangig beschrieben. Die Benutzeroberfläche selbst kann über eine App, eine Webseite oder ähnliches bereitgestellt werden (606).

Drawings 6 and 7 technically describe the business model from drawings 2 to 5:

• Drawing 6A shows a customer (600) using (604) a mobile device (606) connected to the Internet (604) connected to a server (602). The server on which the software implementation was run is connected through interfaces (608) to market makers (106), Automated Trading Systems (ATS) (108) and exchanges (104). Drawing 6B shows the user interface (either website or app) displayed on a mobile device (606). The interface shows a two-dimensional matrix on the left for the selection of financial products and on the right an overview of the financial products already selected. The technical implementation is described in drawings 3 and 4D and works as described above. The user interface itself can be provided via an app, a website or similar (606).

• • API - application programming interface - Programmierschnittstelle
• • Web Service - eine Programmierschnittstelle welche über TCP/IP im Internet bereitgestellt wird
• • Web GUI - Eine grafische Benutzerschnittstelle (GUI) über die der Endkunde mittels Web-Browser zugreifen kann.
• • Web Seite: wird dem Benutzer auf einem Browser dargestellt.
• • Payment gateway: über einen Bezahldienstleister werden sowohl Einzahlungen als auch Auszahlungen durchführt. Dadurch können abstrahiert verschiedene Bezahlmöglichkeiten angeboten werden (Giro-Pay, Kredikarten, Paypal etc.). Über APIs werden diese dann direkt implementiert. Die Absicherung der Zahlungen übernimmt ebenfalls der Bezahldienstleister.
• • Crypto Wallet / Crypto Payment processor: ein digitales Objekt, welches digitale Währungen der Kunden verwalten kann. Meist auch mit Funktionalitäten diese direkt in FIAT-Währung einzutauschen.

The following definitions are the basis for Drawing 7:

• • API - application programming interface
• • Web Service - a programming interface which is made available on the Internet via TCP/IP
• • Web GUI - A graphical user interface (GUI) that can be accessed by the end customer using a web browser.
• • Web page: presented to the user in a browser.
• • Payment gateway: both deposits and withdrawals are processed via a payment service provider. As a result, various payment options can be offered in abstract form (Giro-Pay, credit cards, Paypal, etc.). These are then implemented directly via APIs. The payment service provider also secures the payments.
• • Crypto Wallet / Crypto Payment processor: a digital object that can manage customers' digital currencies. Usually also with functionalities to exchange them directly in FIAT currency.

Drawing 7 describes an Internet server (602) which is connected to market makers (106), ATS (108), stock exchanges (104) and other financial service providers (700) via interfaces (608). The server (106) puts functionalities through to the customers APIs (706), web services (708), a web GUIs (710) and websites (712). The server (602) also has access to cryptocurrency services (734), a crypto wallet or payment service providers (732) or a payment gateway (718) for paying in and paying out sums of money. Furthermore, the processes within the application are shown (602): . Initially, the customer requests a ticket with the available financial transactions (720) - step BB (722). After that, the customer fills out the ticket and sends it back to the server (724). The ticket is then processed by the server as described in drawings 4C, 4D and 5 by breaking it up into transactional threads (750). After the processes (750) have been completed, the end result is communicated to the customer (726). If the customer then requests a payout (728) of his credit balance, this is implemented using a payment gateway (718), a crypto currency service (734) or a crypto wallet (732).

Drawings 6 to 7 show the technical implementation of the business model described in drawings 1 to 5.

The customer (600) uses a mobile device (606) (or another device connected to the internet (604)) to establish an interaction with the server (602): This is done by starting an app, software or opening it the website (606) - or by using other APIs or interfaces. A ticket with a two-dimensional matrix for the selection of the available financial products is then displayed to the customer via the selected channel. The desired financial products and the purchase order can then be specified via the (graphical) interface. After the selection, the customer (600) sends the ticket (binary and encrypted) back to the server (602). After the server has received the ticket and checked its validity, it begins processing as described in drawing 5. Server (602) uses interfaces to market makers (106), ATS (108), exchanges (104) and financial service providers (700). After the ticket has been processed, the end result is sent to the customer. The server (602) then uses payment gateways to make the payment to the customer. The implementation of the software on the server (602) can be divided into several servers: division into display (GUI), interfaces to financial service providers and the actual ticket processing.

Example 3 - Drawing 6 to 7

• Zeichnung 8A zeigt einen Kunden, der mittels PC (800), mobilem Endgerät (606) oder einem Tablet-PC (806) zum Server (602) über das Internet verbunden ist.

Description of a physical machine from drawings 8 and 9 that implements the technical process of drawings 6 and 7 and thus the business process described in drawings 1 to 5:

• Drawing 8A shows a customer who is connected to the server (602) via the Internet by means of a PC (800), a mobile device (606) or a tablet PC (806).

Drawing 8B shows a customer (814) purchasing a ticket (812) through a ticket machine (802). The ticket machine is also connected to the Internet (602).

Drawing 8C shows a customer using a ticket machine (802) to purchase a ticket (812). The machine is connected to the Internet (602) via a data line (804).

Drawing 9 shows the surface of a ticket machine (610) for the purchase of tickets (812). Depending on the area of application of the ticket machine, the range of functions is adjusted. The machine (610) has a screen (912) that displays a two-dimensional matrix for selecting financial products. There are also switches/buttons (902) and credit card readers (904) for payment. Mobile payment devices (906), cash (908) and payout options (910) for the change and a printer (920) for ticket printing (812) are also provided for payment.

How drawings 8 to 9 work

Due to the fact that many people want to physically buy their lottery tickets in a supermarket, gas station or tobacconist, the ticket machine (802) was developed. In principle, there are two ways in which a customer (810) can buy a ticket (812). The first possibility is that the customer buys a ticket in a shop from a seller (814) who generates the ticket with the ticket machine (802). The customer (810) could also fill out the ticket on paper (812) and give it to the seller (814), who then scans the ticket (930) and sends it to the server and collects the fees. The server then processes the ticket as in drawings 6 to 7. The customer can of course also buy a pre-filled (at random) ticket.

The second possibility is that the customer (810) generates the ticket (812) independently on the ticket machine (802). The ticket machine (802) has a screen (912) showing the two-dimensional matrix from drawing 3 and 4D to select the financial products. After the customer has either selected the desired products or bought and paid for a preselected ticket, the customer can use the printer (920) to print out (812) his ticket. After that, the ticket will be sent to the server sent. The ticket processing procedure is described in drawings 6 and 7.

Conclusion and Extensions

The invention shown enables customers to use complex financial products or transactions with a very simple interface that is as intuitive to use as the well-known filling out of a lottery ticket.

The basic idea on which this invention is based is the experience that risky or speculative financial instruments that can be traded with brokers on the financial market are too abstract for those customers who are currently playing the lottery.

For this reason, the business model was developed as described in order to trade complex financial products as easily as filling out a lottery ticket.

An essential part of the lottery are the lottery tickets, which are either filled out by the customer themselves or have already been automatically filled in with random numbers.

Most lotteries present the numbers to be selected in a two-dimensional matrix. The tickets of this invention are deliberately based on the usual lottery tickets. Instead of numbers, however, (indirectly) real financial instruments are selected by the customer - these are then placed on the real markets via a broker.

The tickets described could also be physical objects (like a lottery ticket) that are scanned, digitized and transmitted by machines.

In addition, the ticket can also contain a two-dimensional matrix with symbols, names of financial products, etc. instead of simple numbers. The ticket can also be pre-filled with random numbers.

The following financial instruments could be used with this business model: derivatives, forex transaction, smart financial instruments or input parameters for automated trading systems or robo-traders.

A server with a software implementation represents the technical aspect of this business model. The tasks of this server and thus the software is modular and could also be divided between several servers - a so-called server group. One of the servers has to interact with the customers via the Internet or another data connection so that they can select financial products. After that, the server processes the selected financial instruments by passing them to exchanges, market makers, financial intermediaries or automated trading systems (ATS). It is also possible to arrange the selected financial products in the ticket in the form of a flow chart to define the desired transaction flows and delays between them.

The servers communicate with the customer via a website, an API, a web service, client software or an app. All available internet payment methods can be offered to the customer. In addition, a physical ticket machine was presented, which can also communicate with the servers to create, print and scan tickets for customers. The ticket machine works the same as a lottery ticket machine, however the printed ticket will contain the selected financial instrument or transaction instead of purely lucky numbers.

Claims (4)

A technical process for processing financial transactions comprising the following steps: an end customer receives a list or a graphical representation of available financial instruments or transactions from a server, the customer selects financial instruments or confirms preselected financial instruments or arranges the financial instruments as desired, determines the amount of the he wants to spend and passes this list back to a server which then processes the list, characterized in that one or more servers then process the list sequentially by buying the defined financial instruments and using the profit or loss of the previous transaction to do the next transaction finance. A technical method after claim 1 characterized in that a set of available financial instruments is represented as a physical or electronic ticket containing at least one of the following features: a two-dimensional matrix of numbers, a two-dimensional matrix of ticker symbols, a two-dimensional matrix of symbols. A group of servers of at least one server characterized in that there is a direct or indirect connection to a market maker, an automated trading system, a stock exchange or a financial intermediary to buy or sell financial instruments, a web interface or an API or web interface for customer interaction that is similar to buying and filling out a lottery ticket and processes these received elements sequentially or in parallel. A physical machine for accepting tickets characterized in that there is the same customer interaction as a lottery ticket accepting machine, connected to a set of servers composed of at least one server capable of processing the tickets received sequentially or in parallel, using the result of the previous financial ones transaction is used in the subsequent transaction.

Images