Western Union Gets A Patent On An Exchange For 'Alternative Currencies'

from the because-moneychanging-is-a-new-concept? dept

Remember how the USPTO isn’t supposed to be granting patents on “abstract ideas” like escrow services or payment settlements? Right, so it appears that on April 1st (yes, April Fool’s Day) of this year, the US Patent Office granted Western Union a patent on an exchange for “alternative currencies.” The patent (8,688,563) is technically for “Alternative value exchange systems and methods.” And while it was filed in October 2009 — nearly a year after the original Bitcoin paper — it was before people were really talking about Bitcoin. So the filing doesn’t mention Bitcoin, but does mention many of the more popular digital currencies that came before it (mostly from online games) as well as local currencies which have become increasingly popular as well:

There are many different types of alternative currencies (herein also “alternative forms of value” or simply “alternative value”), each currency representing what the community holds valuable (e.g. time, labor/skill, goods/services, etc.). Alternative currencies currently in use include: “LindenDollars”—Second Life; Amazon.com’s “Quest Gold”; World of Warcraft’s (WoW) virtual “Gold”; Ithaca Hours (Ithaca, N.Y.); Carbon credits; regional currencies in Germany; “Dotz” (Brazil); Tradebank “Credits” (Construction-centric barter network); “Lassobucks” (Time/Skillset currency); Maha Vitaran—Indian power utility barters with other utilities for power; “Bartercard”—Loaded with goods & services (not cash), used in exchange for other goods & services. Many others are planned or currently in development.

But here’s the problem: exchanging currencies is not a particularly new idea. In fact, it’s a very, very old idea. If you read the actual claims of the patent, they’re basically describing the same abstract idea of any currency exchange platform — having people offer to exchange currency, determining the values of the different currencies, and determining at what “price” to do the exchange.

It’s unclear exactly what Western Union will do with the patent — the company itself has mocked Bitcoin — but it does remind us that there’s likely to be a growing number of patent battles in the Bitcoin space before too long. eBay has also received some attention for seeking a patent on a Bitcoin currency exchanger — but that’s still an application that has yet to be approved. Still, there are a lot of others rushing in to patent aspects of Bitcoin, and I imagine it’s only a matter of time until some entity, having nothing to do with Bitcoin, seeks to claim key aspects of Bitcoin as its “intellectual property.”

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Companies: western union

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Comments on “Western Union Gets A Patent On An Exchange For 'Alternative Currencies'”

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23 Comments
Mason Wheeler (profile) says:

Re: Ah, yes

Anyone else find it odd that, around here, taking an existing, well-understood concept, adding “on the Internet,” and attempting to patent it is denounced as non-innovative and harmful, but taking an existing, well-understood business model (such as running taxicabs or hotels) and adding “on the Internet” is praised as innovative and disruptive and must be a good thing?

Anonymous Coward says:

Re: Re: Ah, yes

I do not recall any cheer leading here on TD for any patents claimed upon the “taking an existing, well-understood business model (such as running taxicabs or hotels) and adding on the Internet”.

Perhaps you could refresh my memory since you think it is something denoting a hypocritical posture with respect to the aforementioned “aking an existing, well-understood concept, adding on the Internet, and attempting to patent it”.

Mike Masnick (profile) says:

Re: Re: Ah, yes

Anyone else find it odd that, around here, taking an existing, well-understood concept, adding “on the Internet,” and attempting to patent it is denounced as non-innovative and harmful, but taking an existing, well-understood business model (such as running taxicabs or hotels) and adding “on the Internet” is praised as innovative and disruptive and must be a good thing?

You’re confusing a few different issues, starting with the difference between innovation and invention. Invention is coming up with something new. Innovation is putting something into practice in a way that people find useful.

We support innovation wherever possible. Our problem is with patents that hold back innovation by assuming that the idea is the valuable part, and thus a monopoly can be given based on the idea.

Companies that are actually doing things that are making the world a better overall place are innovating. Companies (or individuals) who are getting a patent on a concept and doing nothing with other than blocking others… are not.

Anonymous Coward says:

Re: Re: Ah, yes

Taking something old and offering it on the Internet maybe a good idea. Getting a patent on it is not a good thing (at least not for anyone other than the patent holder. Patents should serve the public good).

Politicians limiting competition in the hotel and taxi cab industry in exchange for personal gain is a bad thing. Competition in these markets would be a good thing. Are you against competition? Do you agree that politicians should stop limiting competition? Or are you saying that governments limiting competition is a good thing?

Anonymous Coward says:

Re: Patents=Innovation?

trading currency where currency value is determined by community vs
trading money where money is determined by issuing authority

never mind that community is an issuing authority

It’s the difference between trading apples for oranges and trading apples for oranges. Only the patent office understands the context and difference.

Anonymous Coward says:

Re: Re:

Patents are a form of law. Each patent has the effect of law and is, for all practical purposes, a governmental law. If those approving patents are anonymous what we effectively have here are a bunch of unelected, anonymous, people writing and/or approving our laws. So I agree, in the interests of democracy, the personal identity of who approved each patent should be made publicly available. We have a right to know who writes each law.

Ninja (profile) says:

At least bitcoin is open which will make it much more difficult to bring it down. And I’m betting there are some that are profiting from that market that will weight in if there’s a lawsuit with the required financial resources.

That said, the patent is fairly weak. The issue here is that it will have to be contested in the courts. And this can be very expensive.

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