28 May 2020

JWP Patent & Trademark Attorneys

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Bitcoin is a cryptocurrency described for the first time in 2009article by Satoshi Nakamoto. Even now, it is not entirely clear whoSatoshi Nakamoto is. Possibly, it is a group of people cooperatingunder this alias. It is certain, however, that the entire conceptof Bitcoin as an innovative currency revolutionized the globalfinancial market. Bitcoin is one of the so-called FinTechtechnologies.

Bitcoin is one of the examples of utilizing blockchaintechnology. More precisely, blockchain is a decentralized anddistributed database created using cryptographic algorithms withpublic and open registers. In practical terms, it is assumed thatBlockchain makes it possible to obtain a data register that isfully transparent, reliable and safe despite the lack of a centralgoverning body that manages this data. As a result, it was possibleto create, e.g., the Bitcoin cryptocurrency used fortrading online without the supervision of transactions bybanks.

Many people wonder whether such solutions could be patented atall. Firstly, it is necessary to analyze the nature of FinTechsolutions which, as the name suggests, combine finances andtechnology.

Each country and patent office has its own set of acts and lawsregulating in detail patent law in a given territory. However, somegeneral concepts can be found in all legislations and theyconstitute the basic concept of a patent. One of them is therequirement of a technical nature of the solution. It can be wordedin a variety of ways, e.g., the invention is required to have"a technical effect", solve "a technicalproblem", the invention is "a creation based on atechnical idea, in which natural law is applied", etc. Theirmeaning is similar - we cannot monopolize purely abstract conceptsthrough patenting. Similarly, it is not allowed to monopolize insuch a way scientific discoveries, laws of nature or mathematicallaws and operations. Additionally, schemes, rules and methods ofmental processes, playing games or running a business, as well ascomputer programs are usually treated as intangible, and thereforeabstract, solutions that cannot be patented.

That is why in the case of FinTech, the financial aspect perse is very hard to patent. Financial transactions, especiallyonline, are a fairly abstract concept and it is hard to treat themas inventions of technical nature. The essence of the innovativecharacter of those solutions is utilizing modern technologies infinances, which is also problematic. Making a distinction betweentechnical and abstract characteristics, in the traditional sense asstipulated by patent law, is very complicated especially in moderntechnologies based on artificial intelligence, machine learning orblockchain.

Patent offices around the world are currently facing the need toadapt patent law, with its basic principles created in the late19th century, to the requirements of modern industry,described as Industry 4.0. In practice, each office has its owndistinctive approach to patenting computer-aided inventions, namelythose making use of software. It is a result of a change inperception and legal interpretation. For example, patent law in theUS has changed rapidly over the years, moving from a very liberalapproach to a very restrictive one. It is believed that the moststable and predictable approach, as well as quite liberal, is theone of the European Patent Office.

More and more patent offices maintain that although software assuch is obviously not patentable, its application in order to solvea particular technical problem can be patented. Therefore, it ismore likely to patent solutions enhancing the FinTech development,such as making operations more secure by using cryptography orother technical considerations on the function of the innercomputer. Examples of patents granted for inventions regardingcryptocurrencies can be found primarily (but not only) in the C06Qclass of the International Patent Classification concerning systemsand methods of processing data for financial purposes amongothers:

The answer to the titular question is, unsurprisingly given thecontext, that it all depends on circumstances. Preparingdescriptions of FinTech solutions and other new technologies is acomplex and sensitive task. The solution needs to be properlydescribed, supported by necessary figures and embodiments. It isvital to focus on its technical characteristic, as understood interms of patent law. That is why in such a complicated process, theguidance of an experienced patent attorney is indispensable.

Originally published 27 March 2020

The content of this article is intended to provide a generalguide to the subject matter. Specialist advice should be soughtabout your specific circumstances.

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Is It Possible To Patent Bitcoin? - Intellectual Property - Poland - Mondaq News Alerts