Design a bank account ledger

Q: Design a bank account ledger

This is a System Design interview question from Coinbase for Software Engineer roles. View the full question and solution on PracHub.

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Question

Design a Bank Account Ledger Service

Context

You are building the core ledger service for a fintech wallet/banking platform. The service must support customer account balances with full auditability and correctness under concurrency and failures.

Functional Requirements

Deposits, withdrawals, and intra-ledger transfers
Balance queries (posted vs available)
Transaction history with pagination and filters

Non-Functional and Architectural Requirements

ACID semantics for single-account updates
Atomicity for multi-account transfers
Double-entry bookkeeping for auditability and reconciliation
Idempotency and exactly-once effect for API requests and async processing
Concurrency control under high throughput
Integration and reconciliation with external payment rails (e.g., ACH, cards)
Fraud checks, spending limits, and dispute/chargeback handling
Scalability: sharding/partitioning, indexing strategy, read replicas, caching
Recovery strategies: backups, point-in-time recovery, invariants validation

Deliverables

Describe:

Public APIs (endpoints, request/response shape, idempotency usage)
Data model (entities, relationships, constraints) using a double-entry ledger
How to ensure ACID semantics and atomic multi-account transfers
Idempotency and exactly-once processing design
Concurrency control approach
Reconciliation with external rails, fraud checks, limits, and dispute flows
Sharding, indexing, read replicas, and recovery strategies for scale and consistency