JavaCryptocurrencySecurityFintech
Crypto CEX
A centralized cryptocurrency exchange backend with wallet management, order matching, and secure custody solutions.
Overview
A backend system for a centralized cryptocurrency exchange (CEX), handling user accounts, wallet management, order matching, and secure asset custody. Built with security and scalability as primary concerns.
Core Components
Wallet Management
- Hot Wallets: For immediate withdrawals
- Cold Storage: Secure offline storage
- Address Generation: HD wallet derivation
Trading Engine
- Order Matching: Price-time priority
- Order Types: Market, Limit, Stop-Loss
- Fee Calculation: Maker/Taker fee model
Security
- Multi-signature: Required for large transfers
- Rate Limiting: Protection against abuse
- Audit Logging: Complete transaction trail
Technical Implementation
Wallet Architecture
public class WalletService {
private final HotWallet hotWallet;
private final ColdStorage coldStorage;
public String generateDepositAddress(String userId, Currency currency) {
// Generate unique deposit address per user
return hotWallet.deriveAddress(userId, currency);
}
public void processWithdrawal(WithdrawalRequest request) {
if (request.amount() > HOT_WALLET_THRESHOLD) {
// Queue for cold storage processing
coldStorage.queueWithdrawal(request);
} else {
hotWallet.executeWithdrawal(request);
}
}
}
Security Measures
- Hardware Security Modules (HSM) for key storage
- Multi-party computation for signing
- Regular security audits
Challenges Addressed
- Reorg Handling: Dealing with blockchain reorganizations
- Double-spend Prevention: Transaction confirmation requirements
- Hot/Cold Balance: Optimal fund distribution
- Compliance: KYC/AML integration points
System Design Considerations
- Event sourcing for transaction history
- CQRS for read/write optimization
- Idempotent operations for reliability