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Wednesday, January 17, 2018

Big Banks, Blockchain, and Patents

A recent study conducted by Envision IP reviewed patenting activity in the U.S. for the blockchain industry and determined that Bank of America was the single most active player in this space.  Specifically, the study identified 1,045 U.S. patents and patent applications (which are generally made public 18 months after filing) related to blockchain, and found that B of A topped the list with 43, followed by MasterCard International and IBM, each with 27.  Overall, financial services firms own 20% of the U.S. patents and published applications related to blockchain, second only to start-ups and other companies focused on blockchain technology who own close to 60%.  Coming in third, somewhat surprisingly, are traditional technology companies with only about 13% (IBM, which has been the largest U.S. patent owner for 25 years, is an outlier here).  Of course, the blockchain industry is still young and the patent landscape could certainly change.  But these early findings, especially about the financial industry's patenting activity, are notable. 

As my colleague, Heidi Mandanis Schooner, and I wrote about in Big Banks and Business Method Patents, the financial industry was reluctant in the past to protect its innovation with patents and relied on other means (e.g., trade secrets).  Indeed, in the years leading up to the America Invents Act—comprehensive patent reform legislation passed in 2011— the financial lobby persuaded Congress to include a special carve out that made it easier to invalidate financial patents because the big banks were being sued by so-called “patent trolls.”  At the same time, however, we began to see an uptick in banks seeking patents of their own, and we wondered what the future might look like if financial institutions became major players in the patent system, much like the pharmaceutical and technology industries are today.  Because the use of blockchain and other financial technologies (known as FinTech) have expanded rapidly over the past few years, Professor Schooner and I are now working on a follow-up article that explores the current relationship between the financial industry and the patent system and the potential implications for innovation.

Posted by Megan La Belle on January 17, 2018 at 01:58 PM | Permalink

Comments

I encourage everyone writing about bitcoins or blockchains to read the original paper: https://bitcoin.org/bitcoin.pdf

The math is confined to one section and is not important to conceptual understanding. It’s not very long.

They aren’t magic, and they aren’t even obviously useful outside of a fairly narrow domain (i.e. open peer to peer networks).

Posted by: Brad | Jan 17, 2018 8:02:54 PM

And here concerning regulation challenges :

https://www.reuters.com/article/bc-finreg-fintech-regulation/fintech-challenge-for-regulators-evolution-or-revolution-idUSKBN17N1SI

Thanks

Posted by: El roam | Jan 17, 2018 5:56:11 PM

Or here rather :

https://www.techbullion.com/banks-will-soon-acquiring-fintech-startups-instead-investing/

Thanks

Posted by: El roam | Jan 17, 2018 5:46:18 PM

Interesting post , one can assume the following :

Such fin tech companies , would and does , find it hard , to bear and carry on , with financial regulation ( demanding hell of equity ratios , preventing them , from becoming banks effectively ) . On the other hand , traditional banks , would be eager to take over the technology and step in to new digital eras . As such , merging or acquiring them , and simply registering so the patents on the name of the new ( or old ) corporation ( effectively the traditional bank probably ) .
Plausible scenario it seems …..

One may read here for example :

https://www.accenture.com/t00010101T000000Z__w__/gb-en/_acnmedia/PDF-15/Accenture-Strategy-Banking-Strategic-Cost-Reduction.pdf

Thanks

Posted by: El roam | Jan 17, 2018 5:13:50 PM

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