There seems to be some confusion (maybe some because people don't read). The patent is not about digital currency systems in general or a blockchain based digital currency.
The patent is regarding AN EXCHANGE which deals in the conversion of digital currencies for "real" currencies. The patent is still nonsense and if there is any justice will be thrown out the first time WU tries to enforce it. In no case would Bitcoins, Bitcoin transactions, the blockchain, mining, miners, mining pools or proof of work fall within the scope of the patent.
If successfully enforced traditional bitcoin exchanges like BitStamp, BTC-e, etc would be the target. It isn't immediately clear if the scope would cover bitcoin "dealers" and non-traditional systems like coinbase, BitSimple, etc.
So those saying the genesis block is prior art are missing the point. That would be like saying amazon can't patent "1-click" checkout because the dollar existed two hundred years prior to that, or a commodity exchange can't patent a novel order matching system because Gold has been around for thousands of years.
I was addressing commenter Enewit on the broader issues implied by this story.
I agree - patents, in general, are nonesense, but think you underestimate the permanence & 'validity' of patents held by multinationals. Typically, these are only challenged or defeated by other well-capitalized multinational corps.
Further, I beg to differ on your assessment of the patent's content - it is clearly intended to stake claim on digital currency systems [at-large]. "Alternative Value Exchange Systems And Methods" includes sweeping generalizations and illustrates more than just exchange functions. It could be interpreted to characterize the underlying digital asset itself. The language describes
abstraction layers as opposed to a normative exchange/brokerage system. In fact, It goes so far to cover very specific cryptocoin functions such as Proof-of work/stake, 'miner' fees, and programmable escrow:
"'Consequently, although the invention has been described with respect to exemplary embodiments, it will be appreciated that the invention is intended to cover all modifications and equivalents within the scope of the following claims.....
'The method includes creating, at an alternative currency platform..
'An alternative currency platform, the platform comprising:
one or more processors configured to execute instructions stored on a memory device...
creating a plurality of user accounts
'In a further embodiment, an alternative currency platform is disclosed. The platform includes one or more processors configured to execute instructions stored on a memory device..
'The instructions further include publishing the one or more users to the first user, receiving a selection of a second user from the one or more users from the first user, and extending the alternative currency exchange offer from the first user to the second user. Furthermore, the instructions include in response to receiving acceptance of the offer from the second user, verifying the associated assets of the first user and the second user, and in response to verification of the assets of the first user and second user, providing settlement ...
'each of the issuers and the operator of the alternative currency platform may receive a fractional amount of the trade as compensation for providing the exchange service. In another example, the alternative currency platform may act as an escrow for one or both parties by holding value from one or both parties pending performance by the other...
'wherein the sets of instructions when further executed by the machine, cause the machine to, receive, authenticate, and store a scrip value in one of the plurality of user accounts, wherein the scrip includes an associated issuing body...
'In one specific example, the alternative currency platform communicates with the issuers of the alternative currencies involved in the trade and arranges appropriate amounts to be transferred between accounts. In accordance with this example, each of the issuers and the operator of the alternative currency platform may receive a fractional amount of the trade as compensation for providing the exchange service. In another example, the alternative currency platform may act as an escrow for one or both parties by holding value from one or both parties pending performance by the other. ....
'It should be noted that FIG. 3 is meant only to provide a generalized illustration of various components, any or all of which may be utilized as appropriate. FIG. 3, therefore, broadly illustrates how individual system elements may be implemented in a relatively separated or relatively more integrated manner...
More historical perspective on disruptive technologies, gummint looters, & WU patent battles:
http://scholar.lib.vt.edu/theses/available/etd-0698-91234/unrestricted/ch4.pdf"Sherman took a very different tact in his proposal. Sherman recognized that telegrams and letters
were different in both their nature and purpose. While it was true that both were forms of written
communications, the telegraph was fundamentally different than a letter because of its immediacy
of transmission and receipt. It was the speed of communication which changed the communication,
and, in essence, the uses found for the new type of written document. An expanding and dynamic
economy relied on speed of information, and turn around of response, in order to fuel the
commercial transactions of the nation - thus the telegraph played a major role in the commercial
development of the United States. Sherman also recognized that the novelty of the telegraph, and
its developing uses, required that the Federal government move slowly in this area before making
any final, and irrevocable, decisions. The best way to accomplish this development, and at the
same time to bring competition back into the market place, was for the Federal government to
underwrite the construction and operation of another private telegraph system."
