docs: Add PAD-003 Identity Sidecar Pattern disclosure

- New prior art disclosure for Identity Sidecar architecture
- Includes architecture diagram from Nano Banana
- Documents JIT signing flow and MCP integration
- Establishes prior art for LLM key isolation patterns

Signed-off-by: Ramprasad Gaddam <[email protected]>

Author: Ramprasad Gaddam

docs/disclosures/PAD-003-identity-sidecar-diagram.png

@@ -0,0 +1,124 @@
+# PAD-003: The "Identity Sidecar" Pattern & JIT Intent Signing for AI Agents
+
+**Publication Date:** January 03, 2026  
+**Author:** Vouch Protocol Maintainers  
+**Subject:** Decoupled Cryptographic Signing for Stochastic AI Models  
+**Status:** Public Prior Art  
+**License:** Apache 2.0
+
+## 1. Abstract
+
+This disclosure places into the public domain a security architecture for Large Language Models (LLMs) known as the "Identity Sidecar." This pattern solves the critical security risk of entrusting non-deterministic, hallucinatory models with long-lived private keys. Instead, the cryptographic identity is isolated in a deterministic "Sidecar" process (e.g., an MCP Server) that performs Just-In-Time (JIT) signing only when explicitly requested and validated against a local policy.
+
+## 2. Problem Description
+
+In standard agentic architectures, developers often inject API keys or private keys directly into the LLM's system prompt or environment variables. This creates two failure modes:
+
+1. **Key Leakage:** The LLM may accidentally output the private key in its response (Prompt Injection).
+2. **Unauthorized Usage:** If the LLM enters a loop or is jailbroken, it can use the keys to perform unlimited actions without checks.
+
+## 3. The Solution: The Identity Sidecar Pattern
+
+We disclose a method where the "Agent" is composed of two distinct processes:
+
+1. **The Brain (Stochastic):** The LLM (e.g., Claude, GPT-4) which reasons and plans. It holds **ZERO** cryptographic secrets.
+2. **The Passport (Deterministic):** A local sidecar service (e.g., Vouch MCP Server) that holds the `Ed25519` private keys in secure memory.
+
+### Architecture Diagram
+
+![Vouch Identity Sidecar Pattern](./PAD-003-identity-sidecar-diagram.png)
+
+### 3.1 The "Just-In-Time" (JIT) Signing Flow
+
+The signing process is inverted. The Agent does not "login" at the start. Instead:
+
+1. **Reasoning:** The LLM decides it needs to perform an action (e.g., "Book Flight").
+2. **Request:** The LLM sends a structured request to the Sidecar: *"Please sign this specific intent payload: {'action': 'book', 'amount': 500}."*
+3. **Policy Check (The Guardrail):** The Sidecar evaluates the payload against deterministic logic (e.g., "Is amount < $1000?").
+4. **Signing:** Only if the policy passes, the Sidecar signs the payload and returns the signature to the LLM.
+5. **Execution:** The LLM attaches the signature to its API request.
+
+### 3.2 Security Properties
+
+| Property | Traditional Approach | Identity Sidecar |
+|----------|---------------------|------------------|
+| Key exposure to LLM | Direct access | Zero access |
+| Prompt injection risk | Critical | Mitigated |
+| Rate limiting | Application-level | Cryptographic |
+| Audit trail | Logs only | Signed intents |
+
+## 4. Application to Model Context Protocol (MCP)
+
+We specifically disclose the implementation of this pattern via the **Model Context Protocol (MCP)**.
+
+* The **Vouch MCP Server** acts as the Identity Sidecar.
+* The **MCP Client** (IDE/Chatbot) connects to this server.
+* The LLM uses the `vouch_sign` tool exposed by the MCP server to obtain cryptographic proofs on demand.
+
+### 4.1 Example MCP Tool Definition
+
+```json
+{
+  "name": "vouch_sign",
+  "description": "Sign an intent payload with the agent's cryptographic identity",
+  "inputSchema": {
+    "type": "object",
+    "properties": {
+      "intent": {
+        "type": "object",
+        "description": "The action and parameters to sign"
+      }
+    },
+    "required": ["intent"]
+  }
+}
+```
+
+### 4.2 Example Usage
+
+```python
+# The LLM requests a signature through the MCP tool
+result = await mcp_client.call_tool(
+    "vouch_sign",
+    {"intent": {"action": "book_flight", "amount": 450}}
+)
+
+# The sidecar returns a signed token (or error if policy fails)
+vouch_token = result.content[0].text
+
+# LLM uses the token in API call
+response = await api_client.book_flight(
+    headers={"Vouch-Token": vouch_token}
+)
+```
+
+## 5. Prior Art Statement
+
+This architecture combines "Hardware Security Module (HSM)" principles with "Agent Tool Use." By applying the HSM pattern specifically to the **context window limitations and non-deterministic nature of LLMs**, we establish this as a distinct architectural standard for the AI Agent era.
+
+### 5.1 Related Work
+
+| Concept | Source | Differentiation |
+|---------|--------|-----------------|
+| HSM/TPM | Industry standard | Applies pattern to LLM context |
+| Sidecar pattern | Kubernetes/Service Mesh | Applies to AI agent identity |
+| MCP Tools | Anthropic | Novel use for cryptographic signing |
+
+### 5.2 Claims Established as Prior Art
+
+This disclosure precludes patents on:
+
+1. "LLM Key Isolation" - Separating cryptographic keys from LLM context
+2. "Proxy-based Agent Identity" - Using a proxy service for agent authentication
+3. "JIT Signing for AI Agents" - On-demand cryptographic signing for agent actions
+4. "Policy-gated Agent Signing" - Applying deterministic policy checks before signing
+
+## 6. Reference Implementation
+
+- **Repository:** https://github.com/vouch-protocol/vouch
+- **MCP Integration:** `vouch/integrations/mcp/`
+- **Documentation:** https://github.com/vouch-protocol/vouch#mcp-integration
+
+---
+
+*This document is published as prior art to prevent patent assertion on the described concepts while allowing free use by the community under the Apache 2.0 license.*

docs/disclosures/PAD-003-identity-sidecar.md

@@ -12,6 +12,7 @@ These disclosures establish prior art for novel concepts, preventing others from
 |----|-------|------|--------|
 | [PAD-001](./PAD-001-cryptographic-agent-identity.md) | Cryptographic Agent Identity | 2025-12-28 | Published |
 | [PAD-002](./PAD-002-chain-of-custody.md) | Chain of Custody Delegation | 2026-01-03 | Published |
+| [PAD-003](./PAD-003-identity-sidecar.md) | Identity Sidecar Pattern | 2026-01-03 | Published |
 
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