Defending Bitcoin Innovation

Defending Bitcoin Innovation

Adam Back, Samson Mow

Bitcoin is increasingly under threat from a growing body of patents collected by companies inside and outside of the Bitcoin industry. If some of these entities start to use their patent portfolios offensively, development on Bitcoin-related applications could become very precarious.

Back in 2016, we established our defensive patent strategy in the form of our Patent Pledge. Patents were an issue even prior to Bitcoin, where the adoption of various cryptographic technologies was stifled because of patent lockups—we wanted to do our part to ensure the same didn’t happen with Bitcoin. As an example, the Schnorr signature patent expired only in February 2008 and was the reason Bitcoin and other protocols used the less efficient ECDSA.

Taking our defensive patent strategy one step further, today we’re joining forces with Square Crypto in the Cryptocurrency Open Patent Alliance (COPA), announced yesterday. We’ll be committing all of our existing patents to COPA and will be interested to participate with the nine-seat board.

What is COPA?

COPA is an initiative that establishes a library of cryptocurrency technology patents that can be used for defensive purposes by all its members.

Whether you’re an individual or a company, and whether you have a lot of patents or none at all, anyone can join COPA. The only conditions for joining are that each member commits to:

  • Patent Pledge: Members cannot use their cryptocurrency patents for anything but defensive reasons. The Patent Pledge is legally binding, ensuring that the patents safely become free to use for all, even non-members.
  • Shared patent library: Members commit all of their cryptocurrency patents to a patent pool available for other members to also use defensively. This should arm even the smallest members with a formidable arsenal of patents that acts as a lawsuit deterrent against aggressive actions from bad actors.

Blockstream Open Patents

Our patents from the existing Blockstream defensive patent scheme, some of which are already utilized in the Liquid Network, will be added to the COPA  shared patent pool:

  • Sidechains: Transferring ledger assets between blockchains via pegged sidechains.
  • Confidential Transactions: Cryptographically concealing amounts transacted on a ledger while preserving a network’s ability to verify the transaction.
  • Confidential Assets: Cryptographically concealing amounts and asset types for independently verifiable transactions.
  • Confidential Cross-Chain Swaps: Atomic cross-chain swaps using equivalent secret values.
  • HSM Peg Proofs: Address whitelisting using public/private keys and ring signatures.

Permissionless Future

Bitcoin was founded on the principles of open finance and permissionless innovation. With COPA in place, Bitcoin startups and engineers will be able to get on with their important work with the peace of mind that other members have their backs when it comes to patents.

There’s no time for Bitcoin’s progress to be held up by patent trolls. Welcome to open innovation.

Join Us!

The more people and businesses join COPA, the stronger the Bitcoin ecosystem will be. If you’d like to learn more about becoming a member, complete the form available at the official COPA website. We hope you’ll join us in keeping Bitcoin development open and free!

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