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Square Crypto has launched the Crypto Open Patent Alliance (COPA), a consortium in which member companies can use all other members’ patents for free. Square says they have created COPA because “opening access to patents covering foundational cryptocurrency technologies is necessary for the community to grow, freely innovate, and build new and better products.”

However, it is more likely that Square Crypto has realized that innovations that are crucial to building successful blockchain and digital currency platforms and services have already been patented and that they are hoping a few of the companies with these crucial patents—like nChain—will join their consortium so that others will have access to them.

What is COPA?

“COPA creates a shared patent library where members pool all of their crypto patents together to form a collective shield of patents, allowing members to use each others’ patents to deter and defend against patent aggressors,” said COPA in their official announcement. “This helps democratize patents for everyone, empowering even small companies with tools and leverage to defend themselves…We hope that COPA will transform the way patents are viewed and used in the crypto world, and that it will help patents contribute to further innovation and advancement of cryptocurrencies rather than operate as obstacles. We envision the organization evolving over time, and look forward to discussions and feedback from the community to realize this mission.”

But why would Square Crypto launch COPA now and not at the beginning of their business journey? It’s probably because Square Crypto realizes they can’t build a scalable, high-throughput product without tapping into an innovation that is patent protected. 

As we learned from our conversation with a European patent attorney, “A patent application is a commercial tool.”

Which makes the whole idea of COPA seem a little perverse. Companies intentionally patent their innovations because they know that they are crucial in creating a desirable product. Therefore, if a company discovers an innovation, they might patent it and require outside parties to license the patent if they wish to use their innovative technology.

At the moment, Square Crypto is the only company in COPA, and considering that companies patent their innovations for commercial reasons, it will be interesting to see if other companies join Square Crypto’s new non-profit organization.

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