A protocol for bank-to-bank asset exchange in this PITA

Account numbers begin with three digits. These three digits are used to identify banks. We will be calling them routing numbers.

These numbers are assigned ahead of time and are well-known.

type RoutingNumber = number;

Idempotence keys must be set for each message exchanged between banks. This allows each bank to deduplicate messages. A bank must track idempotence keys indefinitely.

Each bank MUST, in the same (local) transaction that handles moving assets, record idempotence keys sent by other banks, and, if they are seen again, return the correct transaction response.

For instance, if bank A sends a transaction T to bank B, and T succeeds but bank B fails to return a response to bank A (for instance, due to a network outage), bank A will retry the request and bank B must deliver the same response.

However, the response must be amended in a way that indicates that this sort of absorption happened: it must set the absorbed field of the response to true.

This can be used by bank A (the sending bank) to detect if it happens to reuse an idempotence key.

Idempotence keys are generated by a bank. Each bank MUST set its routing number as routingNumber, but it is free to generate locallyGeneratedKey in any manner it sees fit.

The maximum length of locallyGeneratedKey is 64 bytes.

type IdempotenceKey = {
    routingNumber: RoutingNumber;
    locallyGeneratedKey: string;
};

There is a need to identify foreign objects. The need for this arises when we're exchanging assets that are not currencies (RSD, EUR, …)¹, and when doing OTC negotiation.

Foreign IDs are the only kind of ID exchanged between banks.

Much like idempotence keys, foreign IDs consist of a routing number, used to identify which bank holds the user, and a bank-specific opaque id string.

Banks (other than those whose routing numbers equal routingNumber) MUST NOT interpret the id string.

The maximum length of the id field is 64 bytes.

type ForeignBankId = {
    routingNumber: RoutingNumber;
    id: string;
};

Deferring to ISO8601.

// Example: 2025-04-16T15:32:44+02:00
type ISO8601DateTimeWithTimeZone = string

A monetary value is some amount of money in a given currency.

type MonetaryValue = {
    currency: CurrencyCode;
    amount: number;
}

Note that the amount in a MonetaryValue ought to be handled by BigDecimal or such (when using Java). It is noted as number here, despite TypeScript numbers being IEEE754 float64, as it should be represented as a JSON number production (see ECMA-404, 2nd edition, section 8). Do not interpret amount as a float64.

An account is something that can be credited or debited. For our purposes, exchanging options (held by persons), stocks (held by persons) and monetary values (held by a persons foreign currency or current account).

As a result, we must distinguish only two account types.

In addition, a OPTION pseudo-account type exists to facilitate the execution of an OTC option contract. See the options section for further information on how this account type is used.

type CurrencyAccountNumber = string
type TxAccount =
    | { type: 'PERSON', id: ForeignBankId }
    | { type: 'ACCOUNT', num: CurrencyAccountNumber }
    | { type: 'OPTION', id: ForeignBankId }

An asset is something that might be credited or debited, which are:

• monetary values,
• stocks, and
• options

type Asset =
    | { type: 'MONAS', asset: MonetaryAsset }
    | { type: 'STOCK',  asset: StockDescription }
    | { type: 'OPTION', asset: OptionDescription }

In a double-entry bookkeeping system, a transaction is a balanced list of credits and debits.

A credit reduces the amount of an asset for some account, and a debit increases the amount of an asset for some account.

A transaction is considered balanced if, regardless of account, all credited and debited amounts add up to zero.

For instance, consider the following transaction, in which I owe my buddy coffee:

• 444000100182503611: -260 RSD
• 111000141215476411: +260 RSD

… in it, 444000100182503611 is credited 260 RSD (since the amount is negative), and 111000141215476411 is debited 260 RSD.

For sake of simplicity, we'll be limiting transactions to be happening in at most two banks (i.e. there must be at most two distinct routing number in postings).

A Message<Type> is a capsule around a MessageBody<Type> that allows tagging it with an idempotence key.

In order to ensure reliable message delivery, each message must be repeatedly retransmitted until properly acknowledged. However, we must also ensure at most once delivery semantics.

To do this, we use idempotence keys. Idempotence keys are values generated by the sender that allow the receiver to track whether it has processed a message already. The sender MUST NOT reuse idempotence keys, and the receiver MUST track idempotence keys indefinitely.

For transport, we will be using HTTP. Each bank shall expose an endpoint /interbank on some base URL that will be receiving messages. This endpoint is secured: each bank shall issue an API key, described later, to each partner bank which is used to authenticate the sender of a request.

A bank should issue an API token for each other bank. These API tokens are opaque and are delivered via the X-Api-Key header with each message request.

When a bank S intends to send a message to bank R, it shall prepare an idempotence key by a method it sees fit. This key shall be placed into the message object along with the payload and messageType intended to be delivered.

This request is then sent as a POST to /interbank.

type Message<Type extends MessageTypes> = {
    idempotenceKey: IdempotenceKey,
    messageType: Type,
    message: MessageBody<Type>,
}

Upon receiving this request, R shall process message as it sees fit and respond with one of three status codes:

202 Accepted

Confirms that the message was accepted and logged locally, but that it is not done yet. S shall retransmit the message later in order to get a response. The response body is ignored.

200 OK

Confirms that the message was accepted and that processing was finished. The response body represents the appropriate response to T.

204 No Content

Confirms that the message was accepted and that processing was finished. The response body is empty. Can only sent if T expects no response.

All other status codes indicate failure to deliver, as do network errors. In those cases, S shall retransmit the message later.

Note that R must record the idempotence key and commit the local part of a transaction before sending a response. A failure to do so may mean that S considers the message delivered and R might never actually act on it, due to a fault or similar.

Messages are distinguished by a messageType field. Its value is dependent on the payload of the message.

type MessageBodyMapping = {
    NEW_TX: Transaction;
    COMMIT_TX: CommitTransaction;
    ROLLBACK_TX: RollbackTransaction;
}
type MessageTypes = keyof MessageBodyMapping
type MessageBody<Type extends MessageTypes>
    = MessageBodyMapping[Type];

To fetch all OTC-traded stocks in a given bank, send a GET /public-stock request. The response body lists each stock and seller.

type PublicStock = {
    stock: StockDescription;
    sellers: {
        seller: ForeignBankId;
        amount: number;
    }[];
}
type PublicStocksResponse = PublicStock[];

This request is sent from a Buyer's bank to a Seller's bank. It creates an OTC negotiation. To create an OTC negotiation, execute POST /negotiations with a OtcOffer payload. A new negotiation will be created, and its ID will be returned as a ForeignBankId response payload.

When a counter-offer is placed (whether by the Buyer or the Seller), a notification is made to the opposing bank containing the updated OtcOffer object.

Let the ID of the offer be id, then the request shall be placed as PUT /negotiations/{id.routingNumber}/{id.id}.

If the receiving bank deems that it is its turn to make a counter-offer, rather than the sellers bank, or if negotiations are closed, a 409 Conflict response code is produced.

Given an OTC offer object off, the the turn is buyers if off.lastModifiedBy ≠ off.buyerId.

In case that it becomes necessary to update a local copy of a Seller's OTC negotiation state, Buyer's bank can place a GET /negotiations/{id.routingNumber}/{id.id} request to fetch a fresh authoritative copy from the Seller's bank.

The response to this request is slightly altered compared to the OtcOffer request, as it is extended with an additional isOngoing boolean indicating whether the negotiations were closed (they were if !isOngoing).

type OtcNegotiation = OtcOffer & {
    isOngoing: boolean;
};

Any party may back out of negotiations by notifying the other party via a DELETE /negotiations/{id.routingNumber}/{id.id} request to the other bank. This sets isOngoing to false.

The person whose negotiation term it is can choose to accept the other parties offer. By doing so, they agree to form an option contract.

When this accept happens, the accepting bank shall send a GET /negotiations/{id.routingNumber}/{id.id}/accept to the other bank. The other bank shall then form a transaction of the following form (let the offer be O):

• Buyer — Credit O.premium
• Seller — Debit O.premium
• Buyer — Debit one optionContract(O)
• Seller — Credit one optionContract(O)

Then, this transaction is submitted to the transaction executor.

Upon successful submission of a transaction, and only then, a response is returned.

Note that the debit of the Seller above should reserve their stocks as part of the contract. See the option section above for a description of this behaviour.

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