Community IP: the case for an ICO Patent fund

In 2014 I applied for a patent on the particular type of hardware wallet i was developing at the time. I thought it was a good idea, once before someone else had patented something I had publicly disclosed and thought it a necessary to protect myself going forward. Long story short- I abandoned the patent process after vehement protest from some members in the then Bitcoin community. (Interestingly, I paid my lawyer in Bitcoin- perhaps one of the first transactions of it’s kind: BitcoinTalk). At the time I had been convinced the precedent was a bad one to follow, but I’ve never stopped thinking about how the ‘real’ world intersects with blockchain- and how blockchain is increasingly become the ‘real’ world.

It is inevitable that elements of blockchain will be patented, it’s already happening. Hadera, the makers of Hashgraph plans to prevent forking by suing any potential forkers and or anyone using their consensus algorithm. The ‘satoshi' charlatan Craig Wright has vocally been pursuing patents in the space and currently is reported to have filed 73 patents for bitcoin and blockchain related technology. It seems like every week there is a new announcement of another large corporation receiving a patent or filing for some aspect of blockchain technology they seek to own.

See: https://www.alixpartners.com/media/3782/ap_the_race_to_patent_the_blockchain_sep_2016.pdf

https://cointelegraph.com/news/china-filed-the-most-blockchain-patents-in-2017

Despite the punk crypto-anarchic sensibilities of the blockchain community at large, patents and IP enforcement present a very real threat to the health and open development of the community going forward. We as a community can not ignore the power patent laws will have on our transition to mainstream use cases and the ability of malicious entities with large patent portfolios to stifle innovation.

To this point, I suggest exploring the idea of a community owned intellectual property portfolio dedicated to the preservation of open technology and reasonable, healthy, licensing designed to foster and protect innovation.

Details aside (not a small point to overlook however) the gist of the idea would be to tokenize fractional ownership in a real legal organization. It would need to be within a jurisdiction where such ownership would be respected, but I suspect this is getting closer to reality every day. Ideally the organization would run something like an ICO, raise a large sum of money from as many different groups as possible, and dedicate the funds to buying up relevant IP, and sponsoring the protection/creation of new and novel IP. The organization could even work with prospective IP filers at small startups to do the paperwork for then, provide legal assistance and support them fully in exchange for assigning some portion of ownership/control to the organization. This isn’t a simple or small task, but it’s not an impossible one.

Ideally this IP organization’s charter would obligate it to license the technology at fees considered reasonable by the community. Perhaps organizations with less than ten million in revenue would have free access while for every ten million in revenue above that the fee’s increase.The profits from licensing could be reinvested into the companies goal, and paid out as dividends to token holders, with some degree of governance.

I understand that for the blockchain community, the idea of patents and IP can be anathema to the core values of crypto, and i don’t disagree. That said, unless i am missing some vibrant discussion (and if i am, please cue me in!) It seems that as a whole the community has no organized response to the danger posed by charlatans such as Craig Wright, goliaths like MasterCard and Visa, and the potential patent portfolio of trolls (Let us not forget about SCO vs UNIX. As controversial as the idea might seem, the realities of the situation means it at the very least warrants a discussion.

Community IP: the case for an ICO Patent fund was originally published in Hacker Noon on Medium, where people are continuing the conversation by highlighting and responding to this story.