First things first: A short introduction to blockchain
Blockchain is a technology full of opportunities, which creates an open distributed ledger validated and verified across a peer-to-peer network consisting of computers, or nodes. Blockchain creates a transparent, open and reliable record of transactions by way of a ledger. The transaction, or “block”, is transmitted to the network of nodes, and is verified by each of the participant nodes. Once it is verified, it is combined with other transactions, forming a new block of data and added to the ledger. These changes are permanent and cannot be altered, ensuring the ledger’s integrity and allowing control to be distributed. The reliable nature of this network makes it open to many possible use-cases in various practice areas.
Blockchain and IP
The world of intellectual property is often troubled by problems concerning theft and copying without permission. There is a whole generation of people who grew up watching ads about the malice of IP theft, hence the problems that haunt this area of practice is no stranger to anybody. However, controlling the copying and distribution of intellectual property, as well as crafting a solidly secure system for the creation to preserve its integrity is a tough feat to cover. Enter blockchain, the secure network system that the intellectual property space sorely needs.
Blockchain can provide the answer to the long-standing problems that trouble the IP industry. The network is transparent, unchangeable, regulable and virtually “un-hackable”. The structure of the ledger and the way IP records are kept promotes clarity, accountability, integrity and reliability. In an area of law that requires record-keeping and systematic integrity as much as IP, it is evident that blockchain is a technology that can help resolve many existing issues.
The application of blockchain to regulate IP protection are, therefore, almost limitless. Some evident examples of its integration being the ensuring of clear registration and reliable recording of IP rights, protection of IP rights by providing a cost-effective way of controlling and tracing the movement of these rights, keeping evidence of rights and creating and enforcing IP contracts. Beyond protecting IP rights, blockchain can also be useful for the consumer and those who interact with the protected work by allowing authentication of works that potentially infringe on the rights attached to that work.
Possible Applications of Blockchain in IP
Possible Use-Case #1: Patents
One clear example of blockchain application to protect IP rights is the creation of a singular patent registry. Patents are registered by country and generally cannot be enforced internationally. This means that the creator of a patented work would enjoy protection in the country or countries where they have registered the patent, but not in other jurisdictions, in which the patented work could be copied. With the use of blockchain, however, there can be the creation of a single patent registry, instead of the system numerous patent offices spread out across the world that is currently in place.
Blockchain could be the solution to providing universal patent protection, allowing creators to enjoy the protection of their works without having to file for a patent in every jurisdiction in the world. Although current law on IP provides ample room for those seeking to file patents, one would still have to file for a patent at each patent office of each jurisdiction in order for their work to be recognised as patented and be protected under the relevant laws of each jurisdiction. A single patent registry would account for all of these jurisdictions and potentially eradicate tracing issues and the complexities of establishing patent protection and searching for evidence of patent infringement.
Possible Use-Case #2: Micropayments
A much-discussed application of blockchain and cryptocurrencies to IP is a micropayment system based on smart contracts for copyrighted works. One difficulty of IP, particularly copyright, is the difficulty of tracing ownership and acquiring a right to use that work. Smart contracts, which are essentially computer codes that can create and enforce a contract without manual help, could potentially resolve the transactional aspect of this difficulty by generating contracts with predetermined terms, allowing transactions to occur without sustaining the costs that would arise from traditional means.
With regard to micropayments, smart contracts could be implemented into micropayments by creating pre-written code that would allow users of copyrighted works to pay for the use of the work. This would also act as a much more transparent and efficient method of payment that would eradicate the issue of authors not receiving monetary recognition for their efforts and eradicate the problem of piracy, while decreasing the administrative costs of setting up a payment portal.
And there has already been use of such technology in media. For example, Imogen Heap, the Grammy-winning artist, recently founded Mycelia, a platform utilising blockchain to acknowledge artists and facilitate efficient payments to authors in the musical industry. Through smart contracts, users could purchase licences to interact with copyrighted works, and the administrative costs normally incurred in the cases of other existing string services would be massively decreased, with the authors of the works gaining more control over their own work.
Possible Use-Case #3: Copyright Registration
Blockchain could potentially revolutionise the copyright system in the UK, which is an exciting step in efforts to solidify and progress the IP system in place. The current system does not offer registration of copyright, which arises when an original qualifying work is created, and does not require any formality to subsist.
This creates an inherent issue of providing evidence for ownership. This issue applies to the authors of the original qualifying work, who is unlikely to be able to know who is using their work and potentially infringing on their copyright, and those using the copyrighted works who cannot, without difficulty, find out who to approach to use the works without infringing on the copyright. This leads to authors being unable to detect and prevent infringements by infringers who often do not know that their acts are infringing.
Applying blockchain technology to IP registration could create a cost-effective system of tracking copyright ownership that could drastically reduce the complications of existing systems and benefit the authors. Blockchain technology ensures authors an IP registry that serves as completely reliable evidence of their ownership - because blockchain transactions are permanent and cannot be changed, authors can trust that the information related to the work they registered to the system will not be altered. This also allows users to view the entire record of copyright ownership in a work and anything that has been done to change the nature of that ownership. Furthermore, this reduces the problem of orphan works, copyrighted works which rights holders cannot be traced or contacted. Efforts to integrate blockchain into copyright registration have been taken up by Sony, who is on the path to creating a blockchain-based Digital Rights Management (DRM) system.
Binded, previously known as Blockai, is a blockchain-based platform that creates a “unique fingerprint” for each image registered on the platform that is entered permanently to the blockchain and generates a copyright certificate as evidence of ownership which protects against copyright infringement. Services offering copyright protection of digital files through blockchain have only increased over the last few years, and the success of these platforms serves as a clear sign that blockchain can completely revolutionise the existing system.
Actual Implementation - A Possibility?
It is evident that many existing problems in establishing the protection of IP rights can potentially be alleviated, if not completely resolved with the help of blockchain technology. However, the question of whether it is likely that the implementation of blockchain into the world of IP can successfully be achieved is one that cannot be answered without the usual issues regarding the reliability of technologies associated with cryptocurrency arising. Regardless, it is clear that there has been a growing trend of blockchain-based solutions to IP infringement and other major issues related to IP, and with the success of these services, it becomes apparent that blockchain should be considered, if not adopted, as the solution to essentially all of IP-related issues.
Not much can be said with certainty regarding the future of blockchain and IP, but it is an undeniable fact that blockchain technology possesses great potential to light the future of IP.