CHLOM License Exchange (LEX) — Marketplace Engine & Transaction Flow Specification (Phase 3→4)

Owner: CrownThrive, LLC Date: 2025-08-08 Classification: Internal — Decentralized Licensing Marketplace Engine & Transaction Orchestration Framework

1. Purpose

This document specifies the high-level architecture, core transaction logic, and orchestration flows for the LEX marketplace engine. It focuses on matching buyers and sellers of verifiable licenses, enforcing compliance via AI/ML scoring and ZKP proofs, and integrating with DAO governance for dispute resolution and policy changes.

2. Engine Architecture

• Core Modules:
• OrderBook: Persistent on-chain matching of bids and asks.
• EscrowVault: Manages asset and token custody during transactions.
• SettlementProcessor: Finalizes trades upon compliance verification.
• FraudGuard Gateway: Pre-trade AI/ML risk analysis and blocking.
• ZKPVerifierAdapter: Validates proof payloads before settlement.
• Service Layer: Off-chain API nodes handling indexing, search, and analytics.
• Interoperability: Built to support EVM-compatible chains and Substrate parachains.

3. Transaction Flow

1. Listing Creation: Seller submits license ID and terms → stored in
2. Buyer Match: Buyer accepts or bids on listing.
3. Escrow Funding: Buyer deposits funds into
4. Compliance Verification:
5. Settlement: If verification passes →
6. Dispute Handling: Routed to DAO arbitration if contested.

4. Data Structures

• Order Schema:

{
  "order_id": "ord-789",
  "license_token_id": "lic-456",
  "price": "500 USDC",
  "expiry": "2025-12-31T23:59:59Z",
  "seller": "0xabc...",
  "status": "open"
}

• Compliance Proof Payload:

{
  "zk_proof_cid": "cid://bafy...",
  "ai_score": 0.96,
  "risk_flags": []
}

5. AI/ML Integration Points

• Pre-Trade: FraudGuard performs Isolation Forest anomaly detection.
• Graph-Based: PageRank-Fraud propagation checks seller/buyer risk networks.
• Sanctions Matching: Matches identities against sanctions/PEP lists.

6. Security & Audit Requirements

• Reentrancy Guards: All financial transactions protected against reentrancy.
• Order Cancellation: Only initiator or governance can cancel open orders.
• Audit Trail: Full on-chain event log linked to off-chain IPFS transaction receipts.

7. Developer Notes

• Languages: Solidity for EVM deployment; optional Rust for Substrate.
• Indexing: Graph Protocol for subgraph indexing of orders and settlements.
• Example Stub:

function settleOrder(uint256 orderId, bytes memory proof) public {
    require(validateProof(proof), "Invalid ZK proof");
    require(aiScore >= minThreshold, "Risk score too high");
    _transferLicense(orderId);
    _releaseEscrow(orderId);
    emit OrderSettled(orderId);
}

This marketplace engine ensures that every license transaction is secure, compliant, and verifiable, with built-in fraud prevention, ZKP compliance checks, and governance-driven dispute resolution.