# ADR-0004: Zero-Trust Authentication Strategy

## Status
Accepted

## Context
The DBIS Core Banking System requires secure authentication for all API requests. Traditional authentication methods are insufficient for sovereign-grade financial infrastructure that handles:
- Multi-sovereign operations
- High-value transactions
- Regulatory compliance requirements
- Cross-border operations

## Decision
Implement a zero-trust authentication strategy using:
1. **Sovereign Identity Tokens (SIT)**: JWT-based tokens with sovereign bank identity
2. **Request Signature Verification**: HSM-backed cryptographic signatures for each request
3. **Multi-layer Validation**: Token validation + signature verification + timestamp/nonce checks
4. **HSM Integration**: Hardware Security Module for key management and signing

## Consequences

### Positive
- Strong security with multiple validation layers
- HSM-backed cryptographic operations
- Replay attack prevention (timestamp/nonce)
- Sovereign identity verification
- Scalable across multiple sovereign banks

### Negative
- More complex implementation
- Requires HSM infrastructure
- Slightly higher latency per request
- More complex client implementation

### Risks
- HSM availability dependency
- Signature verification performance at scale
- Key rotation complexity

## Alternatives Considered

1. **Simple JWT Only**: Basic JWT authentication
   - Pros: Simple, fast
   - Cons: Insufficient security for financial operations

2. **API Keys**: Static API keys
   - Pros: Very simple
   - Cons: No cryptographic verification, weak security

3. **Zero-Trust with HSM**: Chosen approach
   - Pros: Strong security, regulatory compliance, sovereign-grade
   - Cons: More complex

## Implementation
- JWT tokens with sovereign bank identity
- Request signature headers (X-SOV-SIGNATURE, X-SOV-TIMESTAMP, X-SOV-NONCE)
- HSM service integration for signature verification
- Middleware: `zeroTrustAuthMiddleware` in `src/integration/api-gateway/middleware/auth.middleware.ts`

## References
- Zero Trust Architecture: https://www.nist.gov/publications/zero-trust-architecture
- HSM Best Practices: https://www.nist.gov/publications/guidelines-selection-and-use-approval-cryptographic-modules