Protecting intellectual property through patent applications is becoming increasingly relevant as the Bitcoin ecosystem consolidates. As a result, tendencies to oligopolize the industry through patent applications are becoming apparent. So China is the largest owner of blockchain patents. Major corporations such as IBM, Alibaba and Walmart are particularly active in ongoing new applications. What does that mean for an industry that has built its growth on the innovative nature of open source systems?
A look at approved and applied for patents in the Blockchain area allows conclusions to be drawn about the current and future state of the conflict between intellectual property and the freedom of researchers and inventors.
Blockchain patents have more than doubled
An analysis by the Hard Fork Research Group based on data from the United Nations (WIPO) World Intellectual Property Organization (WIPO) found that 2018 was the year with the largest number of blockchain patent applications. If 971 patents were filed in 2017, there were 1,060 registrations in 2018. For 2019, WIPO has already registered 242 Blockchain patent applications.
China is Blockchain patent world champion
With 790 patents, China tops the list of countries with the most patents approved. Second is the USA with 762 patents. By contrast, South Korea is in third place by far (161). Germany also holds only two Blockchain patents.
IBM has applied for over 100 patents
Among the companies that applied for a particularly large number of new blockchain patents last year, IBM, Walmart and Alibaba are at the top. IBM has applied for over 100 patents in the past six months. MasterCard, Intel and Bank of America are also active. However, out of 1,000 applied for patents, only about ten percent receive a permit.
Open source becomes rarer
Above all, the analysis reveals two trends in the industry. On the one hand, companies worldwide see blockchain technology as an important source of innovation in the future. On the other hand, it also shows that the open-source nature of the industry, which among other things gave the industry an anarchist-egalitarian image, is decreasing as technology in the real economy becomes more popular.
While it was common at the beginning of the Bitcoin hype to keep the technology open and patents skeptical, this trend seems to have reversed since 2015. Universities, state institutions and large corporations claim the intellectual property of crypto technology for their own purposes.
China, IBM, Alibaba, Walmart: Big players, little democracy
Oligopolization, that is, the increase of a few larger suppliers, may have an impact on the industry’s innovative capacity in the case of blockchain and crypto technologies.
In the case of China, which is steadily increasing its stance on decentralized cryptocurrencies such as Bitcoin, as well as financing models, the accumulation of patents suggests closing research against the public.