A cryptocurrency is a digital currency which does not rely on banks for transaction verification. Cryptocurrencies are generally not issued by any central authority. They do not use a physical form and are usually implemented with decentralized control. Most cryptocurrencies usually work through a blockchain which serves as a database for public financial transactions.
Most experts believe that the financial valuation of blockchain technology will increase dramatically over the coming two decades. As a result, more inventions related to cryptocurrency have been patented recently than at any other point in the past.
However, because cryptocurrency patents have become extremely coveted, those who apply for them ought to do so correctly. If they do not, several serious issues can arise. Applicants must carefully consider certain points before they proceed.
Cryptocurrency Transactions and Patents
Those who choose to patent transactions which use cryptocurrency should be aware that in most jurisdictions, the subject matter is not patentable. For these cryptocurrency transactions to be patentable, they must include certain limitations. These limitations must usually integrate the abstract idea of a cryptocurrency transaction into a practical use.
Patented items which relate to cryptocurrency do not solely have to be used for cryptocurrency transactions. Some of these patented inventions facilitate payments and transactions made in various modes, one of which may be cryptocurrency. To be deemed patentable, these items ought to address any of various issues related to cryptocurrency transactions.
Among the issues addressed by cryptocurrency inventions which have received patents include speed of transaction, risk assessment, value fluctuation, and dispute resolution. Inventors who can prove that their creation solves a major problem related to cryptocurrency become much more likely to receive a patent.
Cryptocurrency, Computer Software, and Patentability
Cryptocurrencies are usually based on a blockchain program which involves complex computer software. Therefore, the patentability of inventions related to cryptocurrency often depends on the patentability of the software.
Most international intellectual property treaties such as the Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) and the Patent Cooperation Treaty (PCT) allow software to be patentable. For additional intellectual property protection, some holders of rights might also seek copyright protection for the software under the Copyright Act or any other copyright law.
The vast majority of jurisdictions do not classify software, including software used in cryptocurrency, as an unpatentable item. In addition, there are no international restrictions on the intrinsic patentability of software for cryptocurrency-related inventions. Such software will ordinarily have its patentability determined by criteria such as inventiveness or industrial applicability.
The Increase in Cryptocurrency Patents
Speculation in cryptocurrencies is now at the highest point at which it has ever been. Therefore, more people and entities than ever before have been filing cryptocurrency-related patents. Individuals, businesses of all sizes, organizations, and even educational institutions have all pursued patent protection for cryptocurrency inventions.
An extremely wide range of inventions in the cryptocurrency field have received protection through a patent. These inventions include security systems for transactions, techniques for transaction analysis, online storage systems, risk detection mechanisms, and cryptocurrency platforms, just to name a few. As cryptocurrency continues to become more prominent within the global financial landscape, the number of patented cryptocurrency inventions will increase accordingly.
The Effects of Cryptocurrency Patents
One key effect of the increase in cryptocurrency patent applications is the increased public exposure which cryptocurrency has received. General awareness of and interest in cryptocurrency has gradually been increasing. These patented inventions will continue to drive up this awareness and interest. Patents related to cryptocurrency also spotlight the technologies which make those inventions possible. Thus, the tech industry also benefits from the increase in cryptocurrency patents.
The increase in cryptocurrency patents may also require national patent offices to develop clear and consistent guidelines on cryptocurrency. As cryptocurrency is a relatively new field, most offices do not have such guidelines. Today, enforcement of cryptocurrency patents can sometimes be difficult. The patentability of any cryptocurrency-related invention is therefore not always obvious. The creation of proper guidelines will help inventors avert these problems.
However, there are also certain risks associated with the patenting of cryptocurrency inventions. The most notable of these arises when a large company uses a patent to deny a smaller one from partaking in and subsequently further developing cryptocurrency-related technology. The larger company might do so by filing a patent application before developing a functional invention.
This article is brought to you by Exy Intellectual Property Malaysia and Singapore.