According to its official website, COPA seeks to prevent “patent lockups” of cryptocurrency technologies, which may hinder smaller companies from leveraging technological developments, stifling growth and innovation of emerging cryptocurrency technologies.
The alliance requires all members to sign a legally binding pledge to make their cryptocurrency patents freely available and not use them against anyone, except for defensive purposes in order to ensure that the innovations can be used without fear of litigation. Members must also commit all of their cryptocurrency patents to a patent pool available for other members to use defensively.
A patent is a right granted to an inventor by the United States Patent and Trademark Office for a certain period of time. The patent allows the inventor to prevent others from making, selling, or using their invention during the lifetime of the patent.
While the purpose of patents is to incentivize inventors to disclose innovations without fear of plagiarism, patents have also been historically abused and leveraged offensively. One of the ways this has manifested is in the form of patent trolling which involves an entity hoarding patents in order to earn money through licensing or litigation.
Today, patent trolling has become such a prevalent problem that a recent study estimated approximately 90% of patent lawsuits in the tech sector were filed by Non-Practicing Entities, or trolls.
Through its patent library, COPA pursues the establishment of a “collective shield of patents” that allows members to “deter and defend against patent aggressors.” Prospective members do not need their own patents to join the alliance.
Speaking to the BTC Times, Blockstream CSO Samson Mow said, “in an ideal world, patent law would be reformed, but unfortunately it is very challenging to invalidate patents and the best defense against patent abuse is to patent and make technology available under defensive IP schemes - not doing so would put Bitcoin development at risk. Blockstream’s patents were filed for this defensive purpose and have always been open to all under our patent pledge. We hope that by joining forces with Square and having more companies adding additional resources, our DPL initiative can be expanded. Together we should be able build a strong alliance to keep Bitcoin innovations open to all.”
Blockstream is the first company to announce it is joining forces with Square and is interested to work with the COPA board. With an already established defensive patent strategy launched in 2016, the firm is now doubling down on its commitment by joining the alliance.
Blockstream brings with it several existing patents which will be added to the shared patent pool, namely the patents for Confidential Transactions, Sidechains, Confidential Assets, HSM Peg-Proofs, and Confidential Cross-chain Swaps.