Patenting Blockchain: Mitigating the Patent Infringement War

Abstract

The blockchain web platform, most famous for its use in support of Bitcoin, is a sophisticated and unique technology, which many believe is the next disruptive technology that will span across a vast range of industries. Scholars identified more than ten features of this technology that makes it, like no other: "open-ledger", encrypted, everlasting, accessible to all, enables peer to peer transactions, fast, global, trustworthy, decentralized, consensus mechanisms, and irreversible. By embracing all of these features, blockchain technology offers an alternative tool to traditional multi-player economic models for conducting transactions without the necessity of relying on third parties.

This article addresses the misperception of blockchain, perceiving it, similarly to the common understanding of the Internet, as an open platform, accessible to the public, with free entry and most important, in the public domain. Hardly anyone thought to consider protected intellectual property (IP) rights in regard to this technology, that was coined democratic. However, this concept, that there is only one public domain blockchain platform that serves all or that blockchain platforms are free from any IP rights is false. This article alleges, for the first time, that unlike the common perception, not only is blockchain technology patentable, but the U.S. Patent Office granted patents in blockchain platforms and keeps on examining inventions of new and different types of blockchain technologies.

This false assumptions may be based on misunderstanding the technology of different types of blockchain platforms or on the legend about the unknown figure, entity or artificial intelligence (AI) system, named Satoshi Nakamoto, who mysteriously created the technology and "donated" this platform technology, in 2009, without identifying him/her/itself, for the benefit of society.

Additionally, this paper innovatively takes a step further and investigates, the implications of patent law concerning blockchain technology, in order to unveil the emerging risks of patent infringements, which users are unaware of while "naively" using blockchain platforms. By understanding the peer-to-peer multi-player structure of these platforms, one can evaluate the threat the inevitable patent infringements may cause. This article further argues that this threat will become more crucial and weighty with the rising popularity of blockchain platforms. Finally, this research not only points out unexpected legal and economic risks, but also proposes a simple solution to mitigate this potential patent minefield.