Crypto-assets are not only shaking the global financial and payment systems, but are expected to “reduce demand for central bank money.” While numerous stakeholders, including us, are evaluating crypto-assets for purposes of taxonomy, risk and policy (eg., determining the appropriate regulatory framework by way of public consultation), the race is “on” to secure intellectual property rights on the underlying brands and technologies. Indeed, the number of patents, trademarks and copyright applications being filed before various intellectual property offices in the crypto space is rapidly increasing.
Protecting your crypto brand by way of trademark
Over 92 results were located in the Canadian trademark register when using the term “crypto” in the goods and/or services search field;
Over 953 trademark applications in the U.S. trademark register, again using the term “crypto” in the statement of goods and/or services search field.
A brand, or trademark, is a word, name, symbol, design, or phrase used to identify and distinguish a product or service and to indicate the source of the product or service. That being said, it is suggested that those dealing in crypto (or blockchain) should secure trademark protection for their brand.
A sample description of goods and/or services
In this connection, trademark applications in this space will usually refer to various descriptions incorporating the word “cryptocurrency” (or digital currency, virtual currency, depending on the adopted nomenclature). These descriptions usually fall in any one of goods class 9, or services classes 36 and/or 42. By way of example, a statement of goods and/or services could read as follows:
Class 9 - Computer software, namely, cryptocurrency tokens for facilitating commercial financial transactions; Software for using blockchain technology to hold, control, trade, buy, sell, transfer, exchange and use digital assets, namely, cryptocurrency, digital currency and virtual currency; Distributed digital ledgers, namely, blockchain technology for use in recording commercial financial transactions between parties; Software for facilitating on-line and point-of-sale electronic commercial financial transactions; Software for the provision of electronic mobile cryptocurrency, digital currency and virtual currency exchange services; Computer and mobile phone application software for using blockchain technology for electronic trading of cryptocurrency, digital currency and virtual currency, financial data assessment and risk rating analysis, and managing secure financial data transactions.
Class 36 - Provision of on-line currency exchange services, on-line cryptocurrency, digital currency and virtual currency exchange services, and on-line real-time currency and cryptocurrency trading; Provision of on-line electronic commercial financial transactions services, namely, cryptocurrency, digital currency and virtual currency exchange services.
Class 42 - Provision of software for facilitating electronic commercial financial transactions using a point-of-sale device, and for facilitating on-line electronic commercial financial transactions, namely, cryptocurrency, digital currency and virtual currency exchange services.
The crypto-patent space
When using the keyword “crypto” or more particularly “cryptocurrency” in the abstract search field, over 975 search results (as of May 1st, 2020) were located in Espacenet;
This past week, U.S. Patent no. 10,636,030 to Capital One Services LLP came to issue on April 30, 2020 via a Track 1 request. This patent provides for a device that can “generate a cryptocurrency wallet that can be loaded with an amount of cryptocurrency”. More specifically, the device can “receive a payment for facilitating transfers on the mesh network including routing transactional or communication data. Public and/or private keys associated with the cryptocurrency wallets can be used to encrypt communications, thereby providing a secure mesh network”.
Alas, a sustainable mining process! (maybe…)
One of the more publicized applications that was recently laid open to public inspection is Microsoft’s International patent application entitled “Cryptocurrency System Using Body Activity Data”. This application is directed to a cryptocurrency system, which is able to “verify if the body activity data of the user satisfies one or more conditions set by the cryptocurrency system; and award cryptocurrency to the user whose body activity data is verified.” In plain old language, the more body activity, the more cryptocurrency.
The state of crypto (and blockchain) in Canada…
It is no secret that Canada is “one of the three biggest hubs for blockchain technology in the world”. Indeed, according to Cointelegraph “Canada has been recognized as a leading cryptocurrency nation based on its innovation, low energy costs, high internet speed and favourable regulatory regime”.
Indeed, Canadians are very receptive to emerging technologies, as they believe these technologies will allow the country to grow “both socially and economically”. As a result, many Canadians support government initiatives to fund these technological advancements. Canadians realize that in order to be successful in these areas, the federal government must take a proactive approach “by setting ambitious, big-horizon goals, then making strategic investments and targeting resources in specific areas”.
Implementing an IP strategy to: (1) protect your know-how and brand, as well as (2) deal with competitor intellectual property, since there is a lot of prior art (and public disclosures) in the crypto-space;
The filing of patent, trademark and copyright applications is important for those dealing in the crypto space so as to ensure that their proprietary know-how and brands are protected; and
Ensure proper drafting of the description of goods and/or services in trademark applications so as to not encroach on banking and financial services per se.
 https://www.forbes.com/sites/ilkerkoksal/2019/08/23/the-rise-of-crypto-as-payment-currency/#13cf7e5926e9 and Nabilou, Hossein, The Dark Side of Licensing Cryptocurrency Exchanges as Payment Institutions (March 3, 2019). Law and Financial Markets Review (2019), 14(1), 39-47. Available at SSRN: https://ssrn.com/abstract=3346035 or http://dx.doi.org/10.2139/ssrn.3346035, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3346035.
 https://www.imf.org/external/pubs/ft/fandd/2018/06/central-bank-monetary-policy-and-cryptocurrencies/he.htm  See our various written submissions, available at: https://www.durand-lex.com/blockchain-crypto-fintech.  Lausen, Jens, Regulating Initial Coin Offerings? A Taxonomy of Crypto-Assets (March 31, 2019). Proceedings of the 27th European Conference on Information Systems (ECIS), Stockholm & Uppsala, Sweden, June 8-14, 2019. Available at SSRN: https://ssrn.com/abstract=3391764. Indeed, “taxonomy helps regulators to classify crypto-assets allowing them to decide which characteristics are subject to regulation and whether new rules are necessary to ensure market integrity and investor protection”  Singh, T. K., St. John, T., Decrypting Crypto: An Introduction to Cryptoassets and a Study of Select Valuation Approaches, Journal of Business Valuation, 2019 Edition, Sponsored Research Supplement, available at: https://cbvinstitute.com/wp-content/uploads/2019/12/DecryptingCrypto-Final-DIGITAL-VERSION.pdf.  Perkins, David W., Cryptocurrency: The Economics of Money and Selected Policy Issues, U.S. Congressional Research Service Report no. R45427, available at: https://crsreports.congress.gov/product/details?prodcode=R45427.  For example, the Bank for International Settlements (“BIS”), Financial Stability Board (“FSB”), the International Organization of Securities Commissions (“IOSCO”), central banks (eg., Bank of Canada, Bank of England), Financial Action Task Force (“FATF”), amongst many other organizations, have released numerous discussion papers, of which a partial list thereof is available at: https://bitsonblocks.net/2020/04/10/cbdc-dlt-crypto-stablecoin-resources-list/#more-9558 (Updated to April 13, 2020).  https://cointelegraph.com/news/report-number-of-blockchain-patent-filings-outstrips-other-technologies (Published June 13, 2019).  Espacenet is patent database, which contains data on more than 110 million patent documents from around the world, available at: https://worldwide.espacenet.com/patent/.  A Track One request is a prioritized examination that allows a patent application to be processed in a much quicker timeframe and is available for utility and plant patent applications. https://www.uspto.gov/patent/initiatives/usptos-prioritized-patent-examination-program  https://patentscope.wipo.int/search/en/detail.jsf?docId=WO2020060606. See also: https://cointelegraph.com/news/microsoft-files-patent-for-crypto-mining-system-using-body-activity-data (Published March 27, 2020)  https://www.theglobeandmail.com/business/article-canada-emerges-as-a-hub-for-blockchain-technology/ (Updated November 28, 2018).  See for example: https://www.hydroquebec.com/blockchain/.  https://cointelegraph.com/news/canadian-regulator-introduces-new-rules-for-crypto-mining (Published April 29, 2019).  https://betakit.com/bonjour-startup-montreal-desjardins-google-launch-quebec-focused-post-covid-competition/ (Published May 1st, 2020).  Canadian Blockchain Census 2019 Part I: Measuring Canada’s Blockchain Ecosystem (October 2019), available at: https://www.blockchainresearchinstitute.org/wp-content/uploads/2019/10/Chamber-BlockchainCensus-2019.pdf. This report was prepared for the Chamber of Digital Commerce Canada by the Blockchain Research Institute with research support from Accenture.  Hamoni, R; McLaughlin, R; and Rice, F (November 2019). Building Canadian Consensus: Our Maturing Blockchain Ecosystem. Information and Communications Technology Council (ICTC). Ottawa, Canada, available at: https://www.ictc-ctic.ca/wp-content/uploads/2020/03/canada-blockchain-ecosystem-2019-v2.pdf.  https://www.ic.gc.ca/eic/site/062.nsf/eng/h_00102.html  https://www.ic.gc.ca/eic/site/062.nsf/eng/h_00102.html  https://www.ic.gc.ca/eic/site/062.nsf/eng/h_00102.html