TCoin: A Regulatory Cryptocurrency

Abstract

Numerous reports and studies indicate that the lack of effective regulation in cryptocurrencies has not only led to substantial financial losses but also eroded the traditional ”central bank-commercial bank” framework, thereby destabilizing financial systems. To address these issues, a growing body of research has focused on developing regulatory mechanisms for cryptocurrencies. However, existing regulatory proposals face a persistent trilemma: they fail to simultaneously achieve three critical properties—(i) one‑time registration with self‑updating addresses, (ii) completeness (including a lost‑coin retrieval mechanism), and (iii) fine‑grained access control that respects the ”central bank‑commercial bank” framework. This study bridges this gap by proposing TCoin, the first regulatory cryptocurrency that fulfills all three requirements. We first introduce TSFG, a traceable scheme built on SkyEye, which employs cryptographic techniques to achieve one‑time registration with self‑updating addresses and fine‑grained access control for tracing. By integrating TSFG into the RSCoin framework, we construct TCoin—a regulatory cryptocurrency that achieves one‑time registration with self‑updating addresses, ensures completeness through a novel coin recovery mechanism, and enforces fine‑grained access control. Compared to prior work (CB, DAP, PDC, RSCoin, e‑CNY, and RECoin), TCoin is the first to resolve the regulatory trilemma, offering a comprehensive solution that reconciles the disruptive potential of cryptocurrencies with the stability requirements of the traditional monetary system.