CHLOM License Exchange (LEX) — Compliance Automation Module Specification (Phase 3→4)

Owner: CrownThrive, LLC Date: 2025-08-08 Classification: Internal — Compliance Orchestration, ZKP Enforcement, and Regulatory Automation

1. Purpose

This document defines the design and implementation strategy for the LEX Compliance Automation Module, which automates the enforcement of jurisdiction-specific regulations, licensing requirements, and zero-knowledge proof (ZKP) validations across the CHLOM ecosystem. The module ensures that every license issuance, transfer, and renewal adheres to applicable laws without revealing sensitive private data.

2. Core Objectives

  • Automate multi-jurisdiction compliance enforcement.
  • Integrate real-time ZKP verification for sensitive attributes (e.g., sanctions checks, age validation).
  • Enable dynamic rule updates through DAO governance.
  • Provide APIs for third-party regulators to verify compliance state.
  • Ensure GDPR, CCPA, and FATF alignment for data handling.

3. Architecture Overview

  • Compliance Policy Engine: DSL-based rule processor triggered by on-chain events.
  • ZKP Verification Service: Off-chain verifier nodes validating cryptographic proofs.
  • Regulatory Mapping Layer: Jurisdiction-to-rule mappings stored in a secure policy registry.
  • Audit Log Service: Immutable, append-only audit trail stored in CHLOM’s distributed ledger.
  • Integration Points: Hooks into License Management, Marketplace, and DAO Governance APIs.

4. Data Flow

  1. License event triggers compliance check.
  2. Policy engine retrieves applicable jurisdictional rules.
  3. ZKP verifier validates private attributes.
  4. Decision engine determines pass/fail.
  5. Result stored in audit log and optionally reported to regulators.

5. API Endpoints

POST /v1/compliance/check
POST /v1/compliance/update-rules
GET  /v1/compliance/audit-log
POST /v1/compliance/verify-zkp

6. ZKP Integration

  • Circuits: SanctionsCheck, AgeOver, ResidencyProof.
  • Curves: BLS12-381, Pasta curves for lightweight proofs.
  • Performance: Target <200ms proof verification.
  • Security: CRS ceremony with MPC.

7. Governance Hooks

  • DAO proposals can update rulesets.
  • On-chain voting triggers off-chain policy bundle signing.
  • Canary deployments for new compliance rules.

8. Security Measures

  • mTLS for all service communications.
  • Signed rule bundles with semantic versioning.
  • Real-time anomaly detection for suspicious compliance failures.

9. Developer Notes

  • Implement in Rust for the verifier service; TypeScript for rule DSL interpreter.
  • Include integration tests simulating jurisdiction changes.
  • Maintain sandbox with mock regulatory APIs.

This module ensures LEX operates as a globally compliant licensing marketplace while protecting sensitive user data through advanced cryptographic methods and decentralized governance.

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