Over the past 12 months cryptocurrencies have seen a significant increase in interest and media coverage. The most well-known cryptocurrencies include Bitcoin, Litecoin, Ethereum and Ripple.
Cryptocurrencies, in the broadest sense, are digital assets where transactions are secured by different forms of cryptography. Many cryptocurrencies saw their value skyrocket over the past 12 months as their popularity rose and an ever-increasing number of trading platforms offered easy access for more people to buy and sell. Many of the highest-valued cryptocurrencies saw their value peak around mid- December 2017 and have fallen significantly since, leading to claims that they are a fad and have no real value.
Regardless of whether cryptocurrencies are indeed a fad or not, the technology behind many of them has wider ranging applications than digital currencies alone. A key driver behind the interest in this technology is that it is not regulated by a single governing body, like a bank in the case of traditional currencies, and in the ideal scenario is completely decentralised. The distributed ledger system used in cryptocurrencies allows anyone to verify cryptocurrency transactions, while keeping the parties involved anonymous. Other applications for this technology are now being explored with increasing momentum, which is reflected in the number of patent application filings.
The underlying principles of many of these technologies, and the forms of cryptography used, are generally-speaking known.
However, it is the applications for these technologies and their implementation that are often, in principle, patentable. This has led to a significant increase in patent applications relating to blockchain technology over the last few years.
For example, China has seen the number of patent applications in this field treble over the past few years¹. Elsewhere even the larger banks are jumping on the bandwagon with the Bank of America reportedly² having filed a significant number of cryptocurrency patent applications over the past few years.
Patent application filing trends show that other applications of blockchain technology being explored include smart contracts (contracts using blockchain in the verification, enforcement and performance of condition-controlled processes relating to contractual obligations), telecommunications, and the tracking of goods. In essence, blockchain technology can be used for any application requiring the encryption of data and where it is desirable to have a distributed public ledger.
While cryptocurrencies may have seen their rise and fall, the alternative uses for this technology are only just getting started. What this field will look like in 10 years' time is anyone's guess.
Footnotes
¹Source - Financial Times article dated 25 March 2018
²Source – news.bitcoin.com article dated 16 February 2018
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