BLOCKCHAIN
How to navigate intellectual property risk in blockchain projects It’s been well over a decade since blockchain technology first burst onto the scene. And although that initial use case was supporting the public ledger of pioneering digital currency Bitcoin, the intervening years have seen countless new innovations. BY CHRISTOPHER SMITH, SENIOR ASSOCIATE AT REDDIE & GROSE LLP, PATENT & TRADE MARK ATTORNEYS TODAY, blockchain has gone well beyond cryptocurrency to serve as a vehicle for creating trust and driving collaboration between disparate parties. It’s used in everything from anti-money laundering tracking to IoT monitoring, and international money transfers to supply chain monitoring. Yet as tech firms and financial service organisations stake more of their reputation and money on blockchain projects, it pays to acknowledge the intellectual property (IP) implications. Depending on the project, firms may need to understand the nuances of open-source licensing, and take steps to mitigate the legal risks associated with copyright infringement.
More patents, more risk? The sheer volume of new patent applications filed each year illustrates just how popular blockchain has become. A study from consultancy KISSPatent claims that more blockchain-related patents were published
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in the first half of 2020 than in all of 2019, and that 2019 saw three times more blockchain patents published than in 2018. Interestingly it is Fortune 500 companies that appear most active in this space, rather than blockchain-centric start-ups. Alibaba and IBM were the top two publishers as of September 2020, with the Chinese tech giant filing 10 times more patents in the US than Big Blue. However, filing for a patent doesn’t mean it will be granted. This can create uncertainty for companies looking to steer their own innovations clear of potential legal risk – whether for the patent applicant who does not know if their innovation will be protected or for the third party who does not know if a competitor’s patent will actually be granted. And the more patent applications there are, the more possible risk. A second element of unpredictability is that the sheer volume of blockchain patent applications being filed means not all have been published. That means if your company wants to bring a blockchain-based
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