Blockchain Patent War Coming


#1

Bank of America has more blockchain patents than any other company on Earth, including IBM, Google, Facebook, and other Silicon Valley tech companies (Bloomberg). JPMorgan and Wells Fargo also have a relatively large number of blockchain patents. And banking corporations in general have already collected a large percentage of total issued blockchain patents. Why?

I think there are three primary reasons: (1) They understand the value of blockchain in reducing their operating expenses; (2) their existing systems and software code bases are atrocious and obsolete (I’ve worked in FinTech for a while so I know this is true.); and (3) they are weaponizing their patent portfolios in preparation to attack Cardano and other blockchain platforms in the future.

Many people assume that open source projects are immune to patent litigation, but they are not. Patent lawsuits are rarely filed against open source projects simply because most open source projects have no significant money to pay damages; so, it’s not economically justifiable for most patent-holders to sue.

Additionally, many patent-holders are consumer-focused corporations that do not want the negative publicity associated with being the “big bad patent troll.” However, banks are different. They’re accustomed to being reviled as evil monsters and they don’t usually care because they know they can buy politicians to undermine their competitors and preserve their power. This has made the too-big-to-fail banks essentially immune to negative publicity and the court of public opinion.

Additionally, in the case of the Cardano Foundation and several other open source blockchain projects that have successfully funded their operations with ICOs and self-sustaining blockchain-based treasuries, they actually have very significant resources, which makes them much more attractive patent litigation targets. This makes patent litigation a more serious risk for Cardano than other projects managed by the Apache Foundation, Mozilla Foundation, etc.

Patent litigation is potentially a very disruptive problem for any blockchain project. The banking lobby is notoriously vicious and corrupt with enormous financial and political influence over the U.S. regulatory, legislative, and financial systems.

This is another issue that many smart people will ask me about as I discuss Cardano with them. So, I wonder if anybody in our community has any thoughts on these issues?


Cardano vs. EOS
How to Prevent Cardano Domination?
#2

couple quick uneducated thoughts:
CF based in Switzerland, so good luck.
IOHK in HK, so ibid.
IF they can get standing in some international court…
Cardano stack created from ground up so they’ll have a high bar for infringement, written in Haskell probably offers some additional protection.
Open source probably offers some protection, even if not impervious to litigation as you state.

will be interested in other’s thoughts who know more about this :slight_smile:


#3

This seems crucial. Cardano should take measures to limit its exposure.
Can we get someone from the foundation to comment on patenting?
@cf_maki.mukai

We should also remember though that regulatory scenes are different, and although the US is one of Paramount importance, it will also probably be one of the most hostile environments for cryptos (‘litigious’ is not in English, it’s in American :wink: ).

Giving out the genesis ADA to Japanese (mostly) was not random. We will need to leverage supportive regulatory scenes, and always remain distributed, not to say formless… (Have you noticed IOHK recruits (almost?) exclusively remote positions :slight_smile: )


#4

I have also wondered, what stops anybody from copy/paste ALL of Cardano Blockchain to create another service?


#5

Nothing stops them from copy/pasting it, but merely having the source code is just one link in a long chain of interdependent activities, which very few organizations can perform effectively. Source code is the logical embodiment and culmination of a long and arduous process of technical education, creative development, and life experience.

In fact, the real value in any software project is not the source code; it’s the knowledge and experience that a team develops throughout the journey of writing the code and overcoming an endless stream of real-world obstacles along the way. This journey gives them the ability to apply their knowledge, skills, and talents to build valuable real-world tools, systems, and applications. These processes take years (sometimes decades).

Thus, it doesn’t really matter who has the source code if they can’t implement, maintain, and upgrade the tools and systems effectively.


#6

I thought that was the purpose of open source. Charles pointed out his intent to copy the best of their predecessors in his recent Boxmining interview. I see little controversy in that.


#7

Not Controversial in the principals of open source, however, but from a business model it removes being “unique “ as point of difference. That would dilute market position would it not?


#8

But can’t they just update anything Cardano fixes and get it for nothing? It appears a lot of investment of both time and money that can be poached by parasites. Then it comes down to marketing and perception and customer service.


#9

It takes a lot more than copying code to execute the vision of the original creator. I would suspect that part of the reason Hoskinson used Haskell was to ensure there was little competition in the way of Haskell-based crypto firms looking to out-market him on his magnum opus. He has pointed out that they’ve scoured the Earth for Haskell developers, including the creator of the language himself who is on staff with IOHK. So I say best of luck to the imitators in supporting and advancing this protocol beyond the level that IOHK can take it to. I wouldn’t lose sleep over that.


#10

I was thinking exactly that about Haskell choice as well. Not going to loose sleep. I am a veterinarian, new to this space and trying to get my head around the business model. I am an ADA holder because the project seems has a very innovative product and me coming from academia understand and appreciate why they are going down the peer review process.


#11

It requires a different perception of the flow of value in our world to appreciate why Cardano has nothing to worry about from the parasites. From a traditional perspective, “value” has a fixed embodiment in a clearly defined product or service-oriented system. But in the cryptoeconomic world, “value” is a much more fluid concept.

In fact, a well-designed blockchain platform (like Cardano) actually creates, extracts, optimizes, and distributes value from many more points within any socioeconomic system. It transforms almost any human activity into a value-creation process with corresponding value-distribution rewards for everybody involved. Very few people truly understand these concepts AND know how to encode them into scientifically rigorous, provably secure software systems and applications that facilitate the creation and distribution of value within human societies.

Even though it’s obviously rooted in rigorous science, Cardano represents a form of creativity that is more art than science. Giving any of the “parasites” the Cardano source code would be like giving an average human the “The Creation of Adam” (Michelangelo’s painting on the Sistine Chapel’s ceiling) and expecting an average human to be able to recreate it. It’s just not possible for many reasons associated with the nature of the creative process, the fundamental mechanisms of how skill is developed and expressed in human activities, and the unique human relations skills that Charles brings to the table, in addition to the other dynamics described previously.


Cardano and government approval
#12

Great response, thanks for your thoughtfulness.


#13

I think this is simple. You beat them at theyre own game. Cardano should patent its technology. Ofcourse they can then write lisences that allow anyone to use it freely. With the resources they have available I think having a legal team is not that much of a stretch.


#14

The reasons why individuals or organizations choose open source software are lower cost, security, no vendor 'lock in and better quality.

Most innovative companies no longer rely heavily on software sales, which means proprietary software has become less of a necessity. It is reported that almost all of enterprise-level companies use open source software offerings in some capacity.

Because of this shift, more critical systems are beginning to rely on open source offerings, allowing greater funding to help hunt for security bugs.

Proprietary source distributors have started to develop and contribute to the open source community due to the market share shift, doing so by the need to reinvent their models in order to remain competitive.

Many advocates argue that open source software is inherently safer because any person can view, edit, and change code. For example, a study of the Linux source code has 0.17 bugs per 1000 lines of code while proprietary software generally scores 20–30 bugs per 1000 lines.

I think Cardano should remain open source, although your idea has some merit to it.


Cardano and government approval
#15

I agree open source is the way to go. They can patent the core of what they are doing and then structure the lisence so changes are allowed and owned by the public domain. Also the patents should be owned by the foundation and ruled by the voting mechanism of the treasury.


#16

This approach would make a lot of sense!


#17

I was thinking very similar to you. With the code being…

  1. Original.
  2. In Haskell unlike any other.
  3. Posted in GitHub with dates and traceability.

There is no way to sue successfully sue the Cardano for a patent infringement. Yes, some may try, but won’t succeed.


#18

In addition for the though trail that parasites copy paste the source code.
I am a parasite, but every time someone puts value into my platform, it increases crypto value and by having any crypto you are connected to practically all other cryptocurrencies. This is also what Cardano wants.
This source code is an infinite positive loop for a better world.
Just like deep learning, it gets better the more we use it.


#19

as some wise person once said “they can steal your ideas, but they can’t steal your execution”

nothing stops copy/paste versions of Cardano anymore than any other open source crypto. thus 1000+ cryptos and counting!


#20

This touches on what I think is a key point. Cardano appears to aim to function primarily at the protocol layer, not the application layer.

I think a strong argument can be made that after their protocols are well established, they want as much copy/paste adoption and innovation on top of that protocol layer as possible. This will only serve to further entrench the best practices protocols that Cardano is creating, example given Zencash and Cardano Treasury system (consciously refraining from laying it all at the feet of Charles, he’s quite anti-cult-of-personality after all).