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BitBills’s Patent- Will Patents Hinder Bitcoin’s Evolution?


What would an approved patent for a physical Bitcoin mean for the Bitcoin community? Douglas Feigelson, the founder of BitBills, filed a patent with the United States Patent and Trademark Office (USPTO) on December 23, 2011. Just last Saturday, June 27, 2013, the USPTO processed Feigelson’s application and entitled the application for a patent as, “Creating and Using Digital Currency.” There is much concern within the Bitcoin community that such a patent, if approved, could potentially restrict further hardware Bitcoin wallet development.  “Let’s Talk Bitcoin,” highlighted the connection between the patent and BitBills’s cold storage concept.  Additionally, we can question what the further implications of a patent description including the world, “Bitcoin” might mean.  Currently, the Bitcoin community is unique and thriving due to an openness to ingenuity, development of new products and the betterment of existing products and Bitcoin accessories.

What are BitBills?

On May 9, 2011, the first BitBill was launched. BitBills preceded Casascius coins as the first physical form of Bitcoins. As plastic cards, BitBills store Bitcoin and provide individuals with an opportunity to not only store Bitcoins but also trade Bitcoins.  Along with each BitBill, a new Bitcoin address is created to provide a user a place to store Bitcoins and also a QR code to receive and transfer Bitcoins.  As security is key for BitBills and other physical manifestations of the Bitcoin currency, Bitbills are secured through anti-counterfeiting and tamper-evidence.  As each BitBill contains a security hologram and an embedded private key, it is next to impossible to counterfeit a BitBill.

Protection of Ingenuity is Key

Are BitBills an asset to the Bitcoin community? YES! Yet, BitBills are not significant enough to merit a compromise of one of the founding principles surrounding the Bitcoin community: INGENUITY. As Feigelson took the step to request a patent for his BitBills, several in the Bitcoin community are concerned about what this might mean for future opportunities to readily update and improve hardware wallets. With a USPTO stamp of approval on Feigelson’s patent application, members of the Bitcoin community will be restricted in some capacities of improving Feigelson’s design and also building off of BitBills to develop an even more secure and efficient wallet.

Bitcoin has thrived in part due to the limited government involvement to date in the Bitcoin currency and hardware involving Bitcoin. Feigelson’s request for a patent is one of the first steps to bring the United States’s Federal Government into the Bitcoin space. There will most likely come a time when the US Federal Government will take larger steps to get involved and regulate the Bitcoin currency, but the Bitcoin community would not want such involvement to take place prematurely.

Always be Mindful of Unintended Consequences

Certainly, Feigelson’s development of BitBills has worked for the betterment of the Bitcoin community. However, prior to proactively involving the US Federal Government in the Bitcoin space, he should understand the several unintended consequences of such a step. Protecting one’s work definitely makes sense, but one should be mindful that such actions may deter development and growth of a currently flourishing Bitcoin community. What will come of Feigelson’s patent request?  Since this affects everyone in the community, make your voice heard.   Do you agree with Douglas Feigelson’s attempt to secure a patent for BitBills?

Make your voice heard!  We do not know, but we can hope that the free market, limited government, ingenuity  and promoting spirit of the Bitcoin community will not be squelched.

online poll by Opinion Stage
BTC: 199BnLSh2RifJaqy22mnozL6nCQ5TpZVJn

By

Elizabeth serves on the Bitcoin Foundation Board of Directors and as Secretary of the Board. She also serves Account Manager for BitPay, Bitcoin’s lead payment processor where she focuses on bringing charities, political candidates and non profits into the Bitcoin ecosystem. Elizabeth previously served as Director of Operations and Outreach for Bitcoin Magazine and as the Scheduler and Policy Assistant for a US Member of Congress. She has a background in public policy, grassroots activism, and a keen desire to promote decentralization and individual liberties. Elizabeth holds a BA in Political Science from Wheaton College (IL).

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  • http://www.joseph-a-nagy-jr.us Joseph A. Nagy, Jr

    This is a horrible development. Patents have been used horribly in the last 30 years and there is no reason to think this will be any better.

  • Dawie

    Cheers BitBills: http://www.bit-card.de/

  • USPTO

    A patent on public domain knowledge is not allowed, bitnotes were invented prior to Mr Feigelson’s patent application.

    In fact lead bitcoin developer Gavin Andresen came up with the idea and how to implement that idea in 2010, which can be found here https://bitcointalk.org/index.php?topic=737.0

    It should also be noted that printcoins.com publicly disclosed how to do this on Novemeber 26th of 2011, one month before the patent was filed (https://twitter.com/printcoins). One could easily surmise that Mr Andresen’s idea was implemented by printcoins.com which taught Mr Feigelson how to make a bitnote and he tried to patent that knowledge.

    People interested in letting the examiner know these facts before a patent is issued should file a third party submission of prior art via the following link:

    http://webcache.googleusercontent.com/search?q=cache:-LUfhogwspcJ:meta.patents.stackexchange.com/questions/105/i-want-to-make-a-difference-how-can-i-submit-prior-art-to-the-patent-office+&cd=2&hl=en&ct=clnk&gl=us

    I takes about 5 min to complete. all you need is the following information, Application Number: 13/336,779 Confimation Code: 2427

    Do some extra reasearch and submit, don’t let greedy people steal our public domain bitcoin inovations!

    • SimonBelmond

      Will do so. Thanks for guiding us!

  • patents

    This is not patentable, Gavin Andresen came up with the idea in 2010 https://bitcointalk.org/index.php?topic=737.0

  • Paul B

    There is no chance that this could have any legal value. As stated above, the intellectual property is public domain. All a patent does is give the owner the legal opportunity to pursue remedy against the damaged party.

    Not only should the patent not be valid, even if it were granted, and he single handedly wants to take on the Bitcoin community, he’d better have a lot of BTC or Fiat to defend his position, as the community would surely come down on him like a ton of bricks (as well as the patent office for being negligent).

  • Neal Locsin

    Douglas Feigelson’s attempt to secure a patent for BitBills is doing a tremendous disservice to Bitcoin Community. He should defile his claim from USG, and sort it by Private Means.

  • Guest

    You can’t own a segment of a truly free market by force; the service needs to be effective in it’s implementation.

    Be the coolest website. Or the super-easiest service. Or the fastest. Or the most convenient.

    Just stand out and have the necessary functionality.

    In my opinion it is detrimental to support people, ideas or systems which have the effect (regardless of stated goals) of preventing evolution, iteration or derivative works of a concept.

  • Jeff C.

    I could understand patenting this if the currency used is one that he developed using the Bitcoin source (not Bitcoin itself).

  • bri

    This is the precise reverse of what has been happening of late: taking a (previously) patented idea or notion and adding the words “… on the internet” on the application. Here he is taking an algorithm and adding “… on a debit card.” Excuse me, “… on a SMART debit card.” And this completely ignores the prior art aspect. Lastly, to give a physical (non-computer) store for the bitcoins is obvious to this practitioner. I’m very sure that a mechanism for transactions while not connected to the internet has occurred to almost any fellow practitioner of the art. Storing value, whatever the medium begets other mediums of storing that value.