Using blockchain technology to manage IP rights
This article was first published on Lexis®PSL Intellectual Property on 25 September 2018. Click for a free trial of Lexis®PSL.
What is blockchain?
Blockchain is essentially any form of “decentralised” database. Unlike traditional databases where there is a single “true” version which is stored centrally, in a blockchain system, “true” copies of the database are shared with every computer which is part of the blockchain network. Every time there is a change to the database, for example a new copyright work is added, that change has to be verified and accepted by the other computers which are part of the blockchain.
This means that the blockchain tends to be much more secure and less vulnerable to a cyber attack. In order for a new entry to be added to the database, a sufficiently large number of computers will have to agree that the new data is genuine. Once an entry has been added to the database and verified as genuine it cannot be deleted in the future. Data can be updated if all of the computers in the blockchain agree with the change but the record of the original data and the change will form part of the blockchain’s permanent record.
There are different ways for the computers on a blockchain network to agree that an entry can be added (i.e. reach consensus) and it is possible to have a hybrid private/public approach where some authorities, such as an IP office, are given more authority than others in the network. This may improve the accuracy of the data but means that the security of the IP office’s computers is very important and removes some of the security benefits of a truly decentralised system.
Thanks to digital encryption, it is not necessary for all of the information shared in the database to be available to everyone who is part of the particular blockchain. For example, in Bitcoin (still the most famous type of blockchain) the amounts which are transferred between accounts are known and shared between computers on the blockchain network but the identity of the person who owns the bitcoin account is not shared.
In the IP world, this means that it is possible to maintain a blockchain of data, such as rights ownership, the creative development process and royalty payments, without that information becoming public.
How might IP rights be managed using blockchain?
It is possible to use blockchain in IP management systems to ensure the integrity and security of rights data. This includes copyright and related rights such as moral rights as well as trade marks, designs and patents.
Where rights are registered, it could be a hybrid public/private blockchain like that described above which uses the data from the relevant IP office as the single source.