Headline: What is the Crypto Open Patent Alliance (COPA)?
Body: Have you ever heard of FINRA? They oversee training and compliance of many financial professionals, so this is a very powerful government agency. Oh, wait, it’s not a government agency. It’s actually a not-for-profit (NFP), still, it’s VERY powerful. COPA is similar in that it is organized as an NFP, but it is in fact quite powerful in shaping the narrative around cryptocurrency.
What is COPA?
To be most efficient here, don’t think about COPA as an NFP. Rather, think of it as membership to a very exclusive club. I am told that there are clubs that have climate-controlled garages full of exotic cars. The member would walk in (or more likely, send their “person”) points to a car that they want to reserve for the next week, and then roll out with a classic limousine. COPA is similar, only, instead of a collection of exotic cars, they have a collection of members’ patents. If you belong to COPA, you have the obligation to turn over a copy of your patent file, but in return, you get the right to inspect any and all patents you wish within the membership of COPA. Further, if your IP is attacked from outside the membership, you get access to massive resources to help guide you to a legal win.
In the area of cryptocurrency, one main concern is inflation. Given the artificial currency attributes given to cryptocurrency, inflation has to be thought about from beginning to end. Many systems have protocols to “destroy” a portion of the currency from time to time, to ensure that inflation doesn’t become a problem. These protocols would most likely be protected by patents, and these would be searchable for the members of the COPA organization.
Why is COPA needed?
While patents may at times be useful for defensive purposes, offensive and misguided use of patents threatens the growth and adoption of emerging technologies, such as cryptocurrencies. Cryptocurrency adoption is still relatively at a nascent stage and we do not want patents locking up foundational technology and stifling growth and adoption. Additionally, meritless or abusive litigation and threats require a joint communal response. Per their own website, with COPA in the mix, barriers to entry in the cryptocurrency space are very low.
This is not Sesame Street.
This might sound like the beginnings of a utopian society where girls in long flowing robes dance with flowers in their hair. No. This forces us to speak of “patent trolls.” These are firms (the lowest of the low) who patent such things that are a necessary part of something else, so that they get a piece of the vig, each time we do something. For instance, envision that we are building a version of WORD and our vision is to eviscerate their business model, only, oh, no, the “blocking” function so important to our code, is actually held by a different company. Now we have to pay them off before we can launch. They are what is known as a “patent troll” and avoiding these pesky miscreants is a major portion of COPA. On inspection, though, I have to say that I could understand a very real possibility of COPA becoming a terrorizing patent troll as well.
Who can join and what is the cost?
The article is somewhat cagey here, and no firm number is mentioned. But, they do offer an e-mail address if one is serious about joining. COPA says on their site that they “will only collect dues as necessary for the functioning of the organization.” This statement might be doing a lot of heavy lifting, but, given that you have cash for the membership fee, anybody can join, either as an individual or as an enterprise. The enterprise that recently moved into COPA was Meta, and yes, the FB code was a huge addition to the COPA library. After 3 years, the enterprise is qualified to voluntarily withdraw.
OK, so who’s involved now?
Square was a large part of setting up the organization. Coinbase and Kraken have been involved for quite a wile. Meta appears to be very excited about joining. This is a’ rather powerful assemblage of groups.
Let’s take this on a case-by-case basis…
OK, so COPA is deeply involved in this case. In essence, an Australian inventor, a Mr. Craig Wright, tried to copyright Bitcoin’s foundational whitepaper in 2021 by claiming that he is Satoshi Nakamoto.
“COPA is still in the preliminary stages of its mission of bolstering technological development in the blockchain industry. The organization appears to be working on building a solid reputation and establishing its presence among big names in crypto and beyond which will enable it to facilitate tangible contributions to blockchain in the future.”
The Verdict
Cryptocurrency is a new business venue, so things are taking some time to shake out. The UAW is vital to the story of car production in the U.S., but Ford rolled the first model in 1907, and the UAW didn’t form until 1935. So, the bottom line is that I think we’re going to have to wait and see. But, given that hospitals are NFP (usually) and quite a lot of money runs through them, COPA could become quite powerful. It will be interesting to see.
REFERENCES
https://www.opencrypto.org/faq/
Editor’s Note: Please note that the information contained herein is meant only for general education: This should not be construed as Tax Advice. Personal attributes could make a material difference in the advice given, so, before taking action, please consult your tax advisor or CPA.