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

Op-ed - 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.