Non-fungible tokens will be used for a previously unimaginable purpose. The company IBM (International Business Machines Corporation) will use NFTs (Non-Fungible Tokens) to register patents on the blockchain, converting them into digital assets and facilitating intellectual property negotiations.
Patent specialist IPwe has been collaborating with IBM on blockchain solutions for years. The two companies announced last Tuesday, April 20, that they will begin creating NFTs to represent patents.
Patent trading becomes easier thanks to NFTs
IBM already has a division dedicated to blockchain technology such as Bitcoin, which, among other things, allows its corporate clients to record and track entire segments of the supply chain. Now, in collaboration with IPwe, the company will provide the necessary infrastructure to represent intellectual property through non-fungible tokens, encrypting all data and facilitating patent trading.
“Tokenization of intellectual property will allow patents to be more easily sold, traded, marketed and monetized, thereby increasing the liquidity of this asset class,” the two companies said in a joint statement. Patents registered with NFT will be stored by IPwe and hosted in the IBM cloud, developed by its blockchain division.
The patent market could grow to be worth a trillion dollars.
According to IPwe founder Erich Spangenberg, only 5% of all patents on the market are evaluated for commercialization. Therefore, the businessman believes that there is an opportunity for this market to develop to be worth more than a trillion dollars. To achieve this, intellectual property must be easily identifiable, authenticated and marketable, something that NFT technology should enable.
According to Spangenberg, it is very difficult to transact patents today due to the lack of transparency as to who owns the patents and what is patented. For him, this problem could be solved through the use of NFT, which would store all the necessary data on the blockchain, allowing for simple and fast queries while maintaining the exclusivity of the token.
IPwe already operates in the global intellectual property market, allowing users to register, buy, sell and view patents from around the world. Now, with the help of IBM, this project is prepared to evolve and incorporate blockchain technology and non-fungible tokens into its system.
Both companies hope to grow the patent market by attracting clients large and small. IPwe aims to make intellectual property more accessible to corporations, governments, universities and even startups. To achieve this, the project is scheduled to begin operating in the second half of this year.
The current patent market is inefficiently optimized.
According to Jason Kelley, general manager of global strategic partnerships at IBM Services, the current patent market is incredibly “under-optimized,” even though it is a business sector that virtually encompasses almost the entire economy, he explained. Furthermore, the COVID-19 pandemic has accelerated the “digitalization of things” process, creating a more favorable environment for commercial and technological innovation.
That said, transferring patents to blockchain would be a “perfect match,” as it would allow for verification, validation, and increase trust between the parties involved in the transaction. «Patent tokenization creates new markets. “You can give greater value to various ideas and trade them with greater capacity, validity and confidence,” Kelley highlighted. "We are only beginning to scratch the surface of a trillion-dollar market."
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