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Author Topic: How the banks will own Bitcoin®  (Read 2493 times)
Lupus_Yonderboy
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July 10, 2011, 08:19:13 PM
 #1

So let's say Citigroup, or Paypal, or any large financial group decides it wants to offer its customers a handy way to send money to other people. Let's also say they settle on using the freely available Bitcoin protocol. So they buy a lot of hardware and start their own proprietary blockchain, one that doesn't give them diminishing rewards and has no cap on how many coins they can mine. Then they start marketing these new "Bitcoins". Big rollout, mobile apps, nice gui programs for home puters, accepted at all of their b&m locations, commercials on Prime Time tv, etc etc. For many this is the 1st time they ever hear of Bitcoins.

But wait, there's all these fringers and ne'er-do-wells already trading in "Bitcoins", but they are not the right flavor of Bitcoins, so there is confusion on the part of the public. To clear this up, the bank files for a trademark. Their "Bitcoins" are obviously different and a much better product, and therefore needs to be distinguished from other "Bitcoins" that are out in the world. Do remember the primary definition of a trademark (according to the USPTO) is:

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A trademark is a word, phrase, symbol or design, or a combination thereof, that identifies and distinguishes the source of the goods of one party from those of others.

Of course people may try to appeal on 'prior use' grounds, but I honestly doubt they will get much traction vs. an international bank. Especially since nobody currently holds a trademark on "Bitcoin", and the coins by the bank will be a proprietary type that is different than any other ones in circulation. "Prior use" is not an end-all be-all argument, and the bank merely has to convince one government employed patent lawyer that they are correct. I have no doubt they can be most...persuasive. Especially with something as important as Bitcoin.

So they win. They own Bitcoin® and immediately start litigating anyone else who uses the term in commerce. They will have legally hijacked the project for a relatively paltry sum. Even if they make no money on their Bitcoin® project, they still win in the long run.

And you will let them.


How? By your inaction, by your unwillingness to trust anyone, your inability to adapt to the situation at hand. If someone friendly to Bitcoin does not step up and start doing the necessary legal actions to secure the project, then somebody unfriendly to the project will start doing all the necessary legal actions to end it. Once a project becomes viable, these things are simply a matter of course. I believe The Apache Foundation exists mainly for this reason.

Others have tried to step up and do this for Bitcoin, but were casually rejected out of hand because they weren't Satoshi. If Satoshi developed Bitcoin under a pseudonym and then disappeared, I highly doubt that he will break cover to register for a trademark. It is up to the community to find a solution. Of course one of the critical questions is can a community of individualists find a workable solution?

I don't know what the optimal solution is going to be, that is for the community to decide. Ideally some kind of 'Bitcoin Foundation' made up of people who have proven their loyalty to the project with the sole purpose of legally protecting it would be great, and I would gladly toss a few bitcoins toward something like that to help cover legal fees, etc. I know that many chafe at the idea of any organizational structure being applied to Bitcoin, but if we don't make sure that all the i's are dotted and the t's are crossed, then someone will use this exploit to damage or end the project.

Oh, and let me be clear, I personally in no way want to be on any sort of Foundation or council or whatever, nor do I want to try and collect btc to fund anything. I am writing all this simply because I believe that this is an issue that needs to be addressed. Trademark applications for "Bitcoin" are already popping up in countries across the globe. Failing to act soon will mean death by thousand cuts while swimming in the shark infested waters of international finance.
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July 10, 2011, 08:29:49 PM
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"Oh, and let me be clear, I personally in no way want to be on any sort of Foundation or council or whatever, nor do I want to try and collect btc to fund anything. I am writing all this simply because I believe that this is an issue that needs to be addressed. Trademark applications for "Bitcoin" are already popping up in countries across the globe. Failing to act soon will mean death by thousand cuts while swimming in the shark infested waters of international finance."


and therein lies the problem....
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July 10, 2011, 08:35:13 PM
 #3

Having a supposedly distributed project register the trademark is playing with fire. Though, apparently Mt. Gox has applied for the trademark in Europe.

I think the strongest defence we have against Trademarks is making the term "Bitcoin" generic. Trademarks are by definition meaningless. If they can actually be used to describe the product, they loose their trademark protection. Competitors must be free to describe the function of equivalent products.

Though you do bring up one potential problem: what if they call their alternate blockchain "Bitcoin" just to cause confusion? I doubt they will risk it, because simple Internet search is likely to turn up Satoshi Nakamoto's paper, prompting uncomfortable questions about why the banks chose the blockchain parameters they did.

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ahtremblay
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July 10, 2011, 08:37:49 PM
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Just like they did with linux?... Comon guys just because it can be copied, does not mean it will. Bitcoin has 2 years head start. If the protocol does not fail, bitcoin will remain top dog. Thinking that things are copied and "stolen" all the time, is just falling in the trap of IP propaganda.
Nescio
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July 10, 2011, 10:54:01 PM
 #5

Just like they did with linux?...

Exactly like Linux. From Wikipedia:

"In the United States, the name Linux is a trademark registered to Linus Torvalds. Initially, nobody registered it, but on 15 August 1994, William R. Della Croce, Jr. filed for the trademark Linux, and then demanded royalties from Linux distributors. In 1996, Torvalds and some affected organizations sued him to have the trademark assigned to Torvalds, and in 1997 the case was settled. The licensing of the trademark has since been handled by the Linux Mark Institute. Torvalds has stated that he trademarked the name only to prevent someone else from using it."

Bitcoin development is centralized too in a way (it's easy to find and cease and desist the devs), so are the exchanges and merchants. There is more chance of Bitcoin being trademarked and abused by a hostile/greedy entity than by whatever community entity is willing to do it. Maybe the FSF could take it under its wings or something (not sure if they do trademarks as well besides copyrights). It certainly will be more expensive to ligitate after the fact, and depending against whom, more or less successful.
Herodes
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July 10, 2011, 11:04:51 PM
 #6

and therein lies the problem....

So to set this straight, every time you have an idea, you act on it? Every time you have an opinion, you act on it? It becomes rather annoying to see statements like yours always pop up. How much discussion would it be if everything you said needed to be followed by action?

True, if you _really_ want to change something, you need to act. However, anyone is free to state their opinion without acting. I've put forward some ideas in the past that others may or may not act upon and of which I have no intention to act upon. People have real lifes, and real issues to deal with, and for various reasons, not all people have the resources to act on their opinions and/or ideas.

For some people it could be because they're lazy or do not want attention, for others it might mean they are caring for a wife that has cancer, or a handicapped child, or perhaps they have issues to struggle with themselves. Or perhaps they just have a very demanding job, but still tries to contribute a little to the community? It would not be much of a discussion forum if forumites was barred from doing posts they would not act upon.

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July 10, 2011, 11:41:15 PM
 #7

I will do it!

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Houdini
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July 10, 2011, 11:47:54 PM
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I agree with the OP this is a genuine and serious problem that the bitcoin community in large needs to consider and act upon, before it's too late (if it's not too late already !).
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July 11, 2011, 12:08:53 AM
 #9

If Bitcoin projects get legally threatened then there will be tons of media attention, huge Internet wars against the perps, the community will learn, devs will have to change the name and a NewNamedCoin foundation will have to be formed to safeguard the new project name.

Chill out, everything will be okay in the long run.
Meatpile
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July 11, 2011, 12:25:34 AM
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Well this can't be Atlas's alter ego... since he doesnt want to collect btc donations before any actual work is done...

Maybe its a legit fearmonger?

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July 11, 2011, 12:32:27 AM
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If Bitcoin projects get legally threatened then there will be tons of media attention, huge Internet wars against the perps, the community will learn, devs will have to change the name and a NewNamedCoin foundation will have to be formed to safeguard the new project name.

Chill out, everything will be okay in the long run.

^this.

Big centralised banks are big, ripe plump targets riddled with legacy s/ware, bureaucratic malaise and broken finance models ... they would mess with bitcoin at their peril as they are in no condition to embark upon an internet war whilst imploding financially.

They'll either die and fade away quietly or explode spectacularly in BSD account queries.

davux
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July 11, 2011, 12:36:18 AM
 #12

Two different issues are being discussed in this thread.

1. Someone can start a new block chain and thus "steal" the idea of bitcoin on their own chain.
2. Someone can register the name Bitcoin and use it for another system than the original one (be it blockchain-based or not (this is my own addition)).

About issue #1, everyone probably has a different idea about whether having several blockchains/rules (and thus currencies) is desirable or not. I don't have a strong opinion on it yet, but if I'd have to say something I'd say that for the sake of testing it could be interesting to test different blockchains and rules, although I happen to find Satoshi's ones pretty clever. If Paypal or John Doe want to start their own bitcoin-like blockchain, it will be nothing more than another decentralized network after all, so why not. But for this very reason, I doubt Paypal ever tries to do it anyway.

Issue #1-bis: A company/group/whatever could internally use a p2p, bitcoin-like protocol for sharing their own financial information, and have such a network isolated from the global network. This would be stupid IMHO because the network gets its strength from the number of its nodes. And even if they did it anyway, who cares? We won't even know.

About issue #2, I don't believe a trademark on the name "Bitcoin" will ever be a problem. There's already notorious prior use, so it's already too late. But frankly, I couldn't care less about the name. If the community decides to use BCoin instead of Bitcoin, I'll follow happily.

Also: How the banks will own Bitcoin is a very annoying thread title. Please give us a rest on those fancy, self-assured "How catastrophe X will happen" titles already. Looks like a bad newspaper/website trying to make people read its stuff.

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Lupus_Yonderboy
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July 11, 2011, 01:08:03 AM
 #13

I will not put myself forward as any kind of leader or candidate to become one. Nobody here has any reason to trust me, and given some of the differences of opinion I have had with others, it is understandable. I wanted to be clear that this is not a money or power grab by me, instead it is me trying to bring the issue to the attention of the community. Hopefully somebody that is able (and willing) to act upon this does so. I actually want this project to succeed. Unfortunately I do not have the time or resources to help sort this particular problem out. Even if I did, though, I would still defer to other, more respected members of the community.

I am actually glad to hear that MT has addressed this in the EU at least. At least somebody friendly to the project is acting upon it. Granted MT is probably doing so more out of a pragmatic sense of making sure nobody litigates him later, but I would far rather he hold the trademark for bitcoin than some random douchebag lawyer.

 
If Bitcoin projects get legally threatened then there will be tons of media attention, huge Internet wars against the perps, the community will learn, devs will have to change the name and a NewNamedCoin foundation will have to be formed to safeguard the new project name.

Chill out, everything will be okay in the long run.

^this.

Big centralised banks are big, ripe plump targets riddled with legacy s/ware, bureaucratic malaise and broken finance models ... they would mess with bitcoin at their peril as they are in no condition to embark upon an internet war whilst imploding financially.

They'll either die and fade away quietly or explode spectacularly in BSD account queries.

Victims of your own idealogical superiority. Of course the banks are just so inept that they are about to collapse. They couldn't possibly stand up against a few 1337 hax0rs. You will always win because you are right. Fools. Huge internet wars against banks are kinda pointless. They will win the PR game and very little anyone can do will effect their networks. I believe the Anonymous attack on Visa over Wikileaks did what, exactly? Oh yeah, took down a website for a few hours and had zero effect on transactions.

By the way, the fact that outside groups are attempting to trademark "Bitcoin" helps show that the project is indeed viable. Although it is still particularly vulnerable in some respects (as I have attempted to highlight). Still, if we do nothing, somebody else will do it for us.

About issue #1, everyone probably has a different idea about whether having several blockchains/rules (and thus currencies) is desirable or not. I don't have a strong opinion on it yet, but if I'd have to say something I'd say that for the sake of testing it could be interesting to test different blockchains and rules, although I happen to find Satoshi's ones pretty clever. If Paypal or John Doe want to start their own bitcoin-like blockchain, it will be nothing more than another decentralized network after all, so why not. But for this very reason, I doubt Paypal ever tries to do it anyway.

Issue #1-bis: A company/group/whatever could internally use a p2p, bitcoin-like protocol for sharing their own financial information, and have such a network isolated from the global network. This would be stupid IMHO because the network gets its strength from the number of its nodes. And even if they did it anyway, who cares? We won't even know.

Perhaps I wasn't clear by what I meant in the original post. I meant along the lines of Paypal starting its own chain, doing its own mining, and then selling Bitcoins® to its customers that they can transfer to anyone. Since all transactions go through a central clearing house, the p2p aspect is meaningless. Their mining network is of course isolated from the net, and it is easy for them to sell and trasnsfer those coins a number of other ways than through a p2p network.

Quote
About issue #2, I don't believe a trademark on the name "Bitcoin" will ever be a problem. There's already notorious prior use, so it's already too late. But frankly, I couldn't care less about the name. If the community decides to use BCoin instead of Bitcoin, I'll follow happily.

Again, prior use is not an argument that automatically wins. But then I am not a patent and trademark lawyer and I have yet to meet anyone on these forums that is. Also, the name  recognition damage from having to change will hurt the project for a while.

Quote
Also: How the banks will own Bitcoin is a very annoying thread title. Please give us a rest on those fancy, self-assured "How catastrophe X will happen" titles already. Looks like a bad newspaper/website trying to make people read its stuff.

Actually the title is "How the banks will own Bitcoin®", meaning the trademarked term, not the project. And you not only read, you replied Wink
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July 11, 2011, 01:20:42 AM
 #14

You have an interesting question but why would a big bank need Bitcoin principals?  Why would they need a blockchain?

They could just create Citicoin in their databases around the world.  No need for bitcoin or a blockchain for them to create a virtual currency. 

Unless I am missing something? 

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July 11, 2011, 02:42:03 AM
 #15

I am actually glad to hear that MT has addressed this in the EU at least. At least somebody friendly to the project is acting upon it. Granted MT is probably doing so more out of a pragmatic sense of making sure nobody litigates him later, but I would far rather he hold the trademark for bitcoin than some random douchebag lawyer.
Actually, I'd prefer neither a nobody douchebag lawyer nor MtGox get their hands on a bitcoin trademark, or anyone else who has potential selfish finanical interests in the matter. It should be solved with an international nonprofit foundation.
As for the MtGox claim I don't know where they're asking for trademark rights but it's not Europe since there's no country by that name (or Yurp, or Europia), that's a continent actually, and governments issue patents and trademark rights, not geographical entities. Smiley
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July 11, 2011, 02:47:03 AM
 #16

I LOVE this site ! Whoever designed it is a genius !
I especially like this : "Designed by Michael S. Pascazi | Powered by Trademark Troll"
And it looks good too, almost like a profesionall site someone payed a lot of money for...
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July 11, 2011, 02:49:03 AM
 #17

This "Bank" is using Bitcoins.

http://en.wikipedia.org/wiki/Global_Standard_Bank

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Global Standard Bank, is an internet business that uses Bitcoin the new cryptocurrency as its base currency.
Elokane
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July 11, 2011, 10:08:11 AM
 #18

This "Bank" is using Bitcoins.

http://en.wikipedia.org/wiki/Global_Standard_Bank

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Global Standard Bank, is an internet business that uses Bitcoin the new cryptocurrency as its base currency.


Does anyone use this?

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Lupus_Yonderboy
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July 11, 2011, 10:59:16 AM
 #19

You have an interesting question but why would a big bank need Bitcoin principals?  Why would they need a blockchain?

They could just create Citicoin in their databases around the world.  No need for bitcoin or a blockchain for them to create a virtual currency.  

Unless I am missing something?  

An internal blockchain would prevent against casual employee theft, and double spending, etc. It is secure enough that it would be imposssible for someone to counterfeit. Besides the closer their product is to bitcoin, the more successful the attack...whether actually getting the trademark or just creating confusion about bitcoin.
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July 11, 2011, 11:12:00 AM
 #20

This "Bank" is using Bitcoins.

http://en.wikipedia.org/wiki/Global_Standard_Bank

Quote
Global Standard Bank, is an internet business that uses Bitcoin the new cryptocurrency as its base currency.


Does anyone use this?

According to this it is a scam. Do not use.

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