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Gongcheng Kexue Yu Jishu/Advanced Engineering Science
Journal ID : AES-1690_26-3097-3104

Title : BRIDGING TRADFI AND DEFI: EVENT-DRIVEN INTEROPERABILITY PROTOCOLS FOR REAL-TIME FIAT-TO-CRYPTO SETTLEMENTS
Abhinav Reddy Jutur

Abstract : The division between traditional finance (TradFi) and decentralized finance (DeFi) continues to hinder seamless capital mobility across ecosystems. Real?Time Payment Systems (RTPS) achieve near?instant fiat settlements, yet bridging these assets into blockchain environments remains dependent on fragmented, high?latency, and centralized gateways. This gap limits the natural strengths of both worlds, especially speed and efficiency. Based on the publish/subscribe model, the EDSP protocol operates as a decentralized oracle system that allows for synchronization of state updates between two separate ledgers. This protocol will allow smart contracts to initiate fiat payments and bank payment systems to trigger corresponding blockchain settlement actions. The model stresses cryptographic protections against oracle tampering through multi-party authentication and zero-trust routing methodologies. A simulation of latency shows that an event-driven architecture is capable of resolving the deterministic nature of TradFi operations and the probabilistic aspect of blockchain networks. Incorporating compliance events into the settlement process enables institutions to meet their demands for regulatory and transparency obligations. This article sets a roadmap for future liquidity bridging models based on a secure, scalable, and compliant approach to bridging ecosystems. This article proves the value that event-driven models bring to the table in terms of interconnectivity and liquidity, which will allow institutional-level interactions to take place within fiat and decentralized networks.

Keywords : Decentralized Finance (DeFi), Real-Time Payment Systems (RTPS), Event-Driven Architecture (EDA), Blockchain Interoperability, Cross-Chain Oracles, Fiat-to-Crypto Bridges