Bitcoin Mining Firms Face Patent Lawsuit Over Cryptography Use

According to Cointelegraph, Malikie Innovations has initiated legal action against major Bitcoin mining companies Marathon Digital and Core Scientific. The lawsuit alleges that these firms are utilizing Elliptic Curve Cryptography (ECC) methods, which Malikie claims are protected under patents it acquired from BlackBerry in 2023. Malikie Innovations purchased 32,000 'non-core' patents from the former communications giant, and the current legal proceedings focus on the use of ECC in Bitcoin mining operations. The lawsuit highlights the potential implications for Bitcoin users and the broader cryptocurrency industry. Aaron Brogan, founder and managing attorney at Brogan Law, suggests that individual Bitcoin users are unlikely to be targeted due to their limited financial resources. However, mining companies, with their substantial assets, present more viable targets for such legal actions. Brogan notes that if Malikie Innovations succeeds, it could recover up to six years of lost royalties, potentially leading to significant financial repercussions for the defendants, including the possibility of bankruptcy. Brogan further explains that a successful outcome for Malikie could set a precedent for pursuing other mining companies in the United States, potentially threatening the security of the Bitcoin network. Despite this, Brogan believes Malikie is more likely to seek financial compensation rather than disrupt the entire industry. Niko Demchuk, head of legal at AMLBot, adds that Malikie's claims may not be strong if the patents are expired or cover techniques predating Bitcoin's ECC implementation. Demchuk emphasizes that the outcome will depend on the specific patents and the court's interpretation of their scope. This lawsuit is not an isolated incident in the realm of intellectual property disputes involving Bitcoin. The bitcoin.org website previously faced legal challenges when Craig Wright attempted to assert ownership over the Bitcoin white paper. Wright, who claims to be Bitcoin's creator, Satoshi Nakamoto, has been actively filing blockchain-related patents, with 114 filed in the two years leading up to 2019. These ongoing legal battles underscore the complex intersection of intellectual property and cryptocurrency technology.