Blockchain technology has become a major game-changer in intellectual property (IP) protection in the past few years. Its’ possibilities are actively tested and expanded by both the private sector and governments alike.
The worldwide spending on blockchain solutions extends $6.6 billion annually. The money is allocated chiefly to finding a way to exchange information safely. In this sphere, the technology has many implications, so let’s look at how it works and what it does.
Blockchain is a distributed ledger technology consisting of interlinked blocks that store data in the hash. Any digital information within a blockchain is distributed across the network, timestamped, and visible to those accessing it.
The critical aspect of the technology is that it is decentralized, which makes it impossible to tamper with files. Over the past years, the technology expanded in various domains such as logistics, real estate, healthcare, and even advanced areas such as bioprinting.
Blockchain makes patenting trademarks easier
The technology can have a noticeable influence on managing the IP. Thanks to its security, transparency, distributed nature, and accessibility, any entrepreneur, or a small business enterprise can use it.
One of the most obvious ways blockchain can help is by improving the existing patenting system. Usually, an applicant needs to go through a very complicated bureaucratic process when applying for a trademark. One needs to prove that their product is unique and actually works.
Leaving the “actually works” part to you, blockchain can help you prove that you were the first to come up with this idea, thanks to the timestamps. This will secure your rights as the creator and help shortcut many unnecessary steps when obtaining a trademark.
Blockchain, smart contracts, and IP
Sometimes, it takes patent agencies and other regulators a great deal of time to register ownership. This delay can jeopardize the competitive advantage in many industries. One must act fast to protect their inventions and thus stay in the game. But it will be easier to register new IP and transfer ownership with a decentralized registration system such as the blockchain.
A smart contract is a blockchain-based program automatically executed when certain conditions are met. This simple operation opens many possibilities in licensing and transferring IP. For example, a transaction may serve as a trigger to automatically sign an agreement. This shortens the process of buying patents, which usually involves multiple stages. And most of them require no human involvement and can be covered by smart contracts.
The idea is the same as with automatic transactions. Smart contracts transfer copyrights the moment when funds are obtained. The technology is beneficial in automatically initiating legally binding obligations, such as non-disclosure agreements (NDAs). Also, smart contracts may be helpful when enforcing registration for protected digital content.
Blockchain can also serve as a distributed-ledger-based IP registry. This will allow IP owners to keep hashed digital certificates proving their rights. The same registry can also simplify buying copyright and obtaining royalties for it.
Blockchain counters counterfeit
Another trademark-related feature involves tracking it so that a country’s registration office can document the date of use, frequency, and who exactly uses it. This will ease obtaining royalties for the original owner and help determine whether a particular manufacturer has the license. Though there are many ways to identify a product’s authenticity, such as source, quality, available features, price, sometimes it is not enough.
People cannot always distinguish a counterfeit product from the original one. In many fields, this may cause dire consequences. Blockchain technology makes it possible to tag each legitimate manufacturer and virtually all items produced. The unique identifier may look like a QR-code, allowing consumers to verify its origin by scanning it. And encouraging customers to do so will save your IP rights and protect them from using an unknown product.
Blockchain as proof in legal disputes
The technology can be used as a platform for verifying IP ownership. Obtaining a trademark and patenting is helpful, but your IP can’t be too safe. In many countries, copyright protection on works of art begins immediately when such work is first created. So in case a dispute arises, the original creator only needs to prove that they were the first to make it. The timestamps used on blockchain may help here.
IP ownership is hashed in blocks of the system. Because of its decentralized nature, blockchain can’t be accessed by other parties. Since there is no way to tamper with timestamps, it may serve as valuable proof of ownership. This is especially crucial for businesses operating with China, which has recently recognized blockchain evidence as legally binding.
Another problem that blockchain can help solve is determining who owns IP at a particular time. It’s hard to draw a line between getting inspired by somebody else’s work and stealing it. This problem is especially acute online. The moment the work is uploaded on the internet, it becomes nearly impossible to control who is using it and for what purpose.
Changing pieces in an artwork won’t help those seeking to infringe your copyright. Blockchain technology validates the integrity of music, design, or any other asset, thus preventing duplication of any information. This is also one of the most valuable features of the CADChain solution, BORIS.
Blockchain for IP trading
Blockchain can act as a medium for exchanging IP assets between two parties. Since blockchain is a distributed ledger technology, it makes transactions on it free from vulnerabilities of physical currency.
The idea is the same as with trademarks — a timestamp serves as a valid proof of transaction, with smart contracts covering ownership validation. This transparency and the technology’s decentralized nature may help create a genuinely free digital market.
The technology of the future
The examples given show how to use blockchain technology to control and gain all benefits from your IP. There are many more prospects for it: managing monetization of IP rights, improving collaboration between creators, achieving fair royalties distribution, etc. Legal systems in many countries adapt to the possibilities that the blockchain gives them. This revolutionizing technology has a great potential to improve every creator’s life.
