There is not a day where the words “crypto,” “blockchain,” or “digital ledger” are used in the news or daily conversations. While some are caught up in the unstable climbs and drops of the various digital currencies, a patent war has been brewing. Some of the major financial institutions, including Goldman Sachs and Bank of America, have patented the fundamental technology that allows blockchain to reach new frontiers. In 2019 for instance, the AnnA Villa in Paris made history by becoming the first ever European property to be sold entirely via blockchain transaction for 6.5 million Euros.
As cryptocurrencies move to the forefront of the everyday financial system, major exchanges such as Coinbase, Cash App, Binance, and Bisq, that allow individuals to exchange various currencies, have seen an uptick in mergers and acquisitions. Notable, Coinbase debut on the Nasdaq in April 2021 with a 86 billion USD market value.
This comes shortly after a flurry of M&A activity in 2020. In a report published by PwC, the total market value of crypto-related deals during the first half of 2020 ($600 million) exceeded all of 2019. This is significant even when accounting for Binance’s estimated 400 million USD acquisition of CoinMarketCap in April of 2020.
Later in November 2020, PayPal made the jump into crypto offerings, putting the whole financial industry on notice. This activity has some predicting that digital financial companies, such as Square, Mastercard, Visa and also tech giants like Facebook, will set a pace for broader financial services companies in the upcoming quarters with their own investments and moves into crypto offerings.
Meanwhile, the second half of 2020 saw deals involving decentralized finance largely built on Ethereum. These factors have led to a number of new applications that mostly centered on the trading and liquidity sourcing of more thinly traded crypto currencies. The interesting part of late 2020 and early 2021 was not only the myriad of new applications, but the rise of blockchain-based Non-Fungible Tokens (NFT) which saw celebrities and even famous investors create their own tokens.
The highest-value NFT sale to date is a piece by crypto-artist Beeple put on auction at Christie's. It was the first NFT to be sold at the historic auction house and pointed to a newfound institutional legitimacy for the burgeoning market. The art piece, titled "Everydays: The First 5000 Days," was a compilation of 5,000 pieces by Beeple. The token sold for 69 million USD.
Not only did the concept of NFTs launch, but it spurred a new social media network launch just a few months ago called BitClout. This platform allows people to buy or sell non-fungible tokens to an automated market maker; the tokens are called "creator coins" and are bound to cryptographically secured accounts with unique names.
While the focus has been in the financial sector, the reach of Blockhain’s disruption is not an isolated event. It has the potential to affect every industry including 5G. For example, vehicles will be utilizing the Vehicle-to-Everything system (V2X). The V2X system will need hundreds of key-paired certificates weekly, which a blockchain would be able to provide.
With all the recent activity, Unified Patents decided to look at the landscape to determine, in the US, who were the top patent holders and how companies could use various metrics to examine both their patent portfolio but also their choice of a patent prosecution firm to bolster their position in the blockchain market.
Using the keywords identified below in the appendix, the search resulted in 1,965 patent families, which included 5,985 patents or patent applications. Of that 1,969 were from the US. China followed in second with 1,417. WO applications encompassed 737, EPO had 444, while Korea had 226. The geographical breakdown can be seen below.
Regarding US patents, Unified found the top five patent holders to be Qomplx, Advanced New Technologies, IBM, Walmart, and Accenture. The top 20 holders can be seen below.
Using Unified Portfolio Value Index (PVIX), for the top-20 patent holders an interesting trend emerged. The range of scores are between 43 and 65, meaning that there is no clear leader yet in terms of value. Looking at the standard deviation, 3 companies manage to fall outside of the first deviation, Accenture, Ping Identity Corp, and Mastercard. This would indicate that Accenture, Ping Identity Corp, and Mastercard portfolios in this space have a greater value.
Accenture had the highest PVIX score. One of its highest scoring patent families includes US Patent No. 10063529, which was in Art Unit 2438 - Cryptography and Security. Fish & Richardson handle the prosecution of the given patent. As demonstrated by Unified’s Law Firm Prosection Tool (LPIX), Fish & Richardson is one the top performing law firms in this art unit in terms of allowance rate, pendency, and breadth of allowed claims (which was measured using Unified’s Broadness Index “BRIX”) . This would mean that in general, Fish & Richardson on average gets more patents granted, at higher speed, and is typically broader than the average application. Other notable performers include Hamilton Desanctis & Cha; Oblon, McClelland, Maier & Neustadt; Haynes & Boone; and Moore and Van Allen.
Unified’s Portal not only shows the top-5 performing law firms for a given art unit, but also includes the top-100 based on LPIX.
Additionally, Unified’s Portal includes an interactive graph that allows users to customize their selection based on factors such as Pendency or BRIX.
Not only can performance be determined on an individual art basis, but by selecting all the Art Units that cover Cryptography and Security, companies can select counsel using these metrics. By looking at the individual art unit, companies can see how challenging a respective unit is. Art Unit 2491 would be one of the hardest as it has an allowance rate of 67.1%, while Art Unit 2497 is considered one of the easier art units with an allowance rate of 84.7%.
Companies can also see, as a whole, how individual law firms fare in this grouping of Art Units. Again, Fish & Richardson is one of the top performing law firms on a consistent basis.
With the increased focus on blockchain and the technology surrounding it, Unified wanted to provide a way that companies can use real-time data to increase not only the quality of their portfolio but also their own efficiencies when it comes to selecting a law firm for patent prosecution. LPIX is able to cut through that noise using relevant criteria--- companies can now select the right law firm when it comes to patent prosecution. This in turn can bolster a company’s position in the quickly growing blockchain industry.
Appendix
Keywords Used: blockchain transaction database, block chain transaction database, blockchains, block chain database, permissionless blockchain, blockchain database, types of blockchain, blockchain game, sidechain ledger, applications of blockchain, blockchain technology, hybrid blockchains, draft hybrid blockchain, nakamoto consensus, permissioned blockchain, industrial blockchain, "51" percent attack, blockchain rollback attack, product tracing, genesis blockchain, data structure blockchain, stock token, digital currency, ledger, non fungible token, distributed ledger, central bank digital currency, ripple payment protocol, decentralized finance, cryptocurrency, decentralized autonomous organization, digital asset holdings, uniswap, smart contract, hashgraph, cryptocurrency exchange, and cryptocurrency wallet.