JPMorgan Files Patent Application On 'Bitcoin Killer'

Velcroman1 writes "Banking giant JPMorgan Chase has filed a patent application for an electronic commerce system that sounds remarkably like Bitcoin — but never mentions the controversial, Internet-only currency. The patent application was filed in early August but made publicly available only at the end of November; it describes a 'method and system for processing Internet payments using the electronic funds transfer network.' The system would allow people to pay bills anonymously over the Internet through an electronic transfer of funds — just like Bitcoin. It would allow for micropayments without processing fees — just like bitcoin. And it could kill off wire transfers through companies like Western Union — just like Bitcoin. There are 18,126 words in the patent application. 'Bitcoin' is not one of them."

Comments

Maybe the Patent Office will notice

[eclectus]

Maybe the patent office will notice a bit of prior art? One can hope, right?

Re:Maybe the Patent Office will notice

[tgetzoya]

The US moved to a first to file system recently: https://en.wikipedia.org/wiki/First_to_file_and_first_to_invent#The_USA.27s_change_to_first-inventor-to-file_.28FITF.29 So this might get approved regardless.

Re:Maybe the Patent Office will notice

[the eric conspiracy]

No, first to file doesn't affect the issue of publicly disclosed prior art.

First to file only sets the priority of the application.

Re:Maybe the Patent Office will notice

[fuzzyfuzzyfungus]

Maybe the patent office will notice a bit of prior art? One can hope, right?

I suspect that JP Morgan's patent attorneys aren't idiots, so they've probably done some clever rules-lawyering; but 'bitcoin' is one of those things with such substantial public recognition that it won't be trivial to hide unless the examiner is really sleeping on the job.

With a lot of painfully-obvious tech patents, the prior art (while it definitely exists) is mostly working knowledge among techies, and (because it's considered obvious) often doesn't get a writeup anywhere, although source implementations and the like may be publicly available. That's the sort of thing that makes it easier to sneak by the examiner with a bit of creative rewording so that the old 'just google the important-sounding strings' doesn't work.

Bitcoin, though, didn't Newsweek, or some rag of similar caliber, to a (deeply uninformative, possibly actively misleading) puff piece on it a little while ago? It isn't exactly commonly well-understood; but you'd have to be living under a rock to have not heard at least some journalist's 3rd-hand interpretation of what it is.

Re:Maybe the Patent Office will notice

[nurb432]

JP has the money to avoid that little inconvenience. This will go thru, and the will sue bitcoin.

Re:Maybe the Patent Office will notice

[Connie_Lingus]

yeah maybe you won't.

Re:Maybe the Patent Office will notice

[tgetzoya]

Yes, but I'm thinking more of USPTO process in this case. The patent can still be granted unless someone files a petition citing prior art. After that it may be invalidated based on Bitcoin existing, but my point it that it's still possible that the bank can receive this patent.

Re:Maybe the Patent Office will notice

[TWiTfan]

It doesn't matter. If the people behind Bitcoin never bothered to file for a patent, JP Morgan is now going to get it first--meaning Bitcoin will then be in violation of said patent (as unfair as that is).

Something tells me that there is more behind JP Morgan filing this patent than just an innocent attempt to patent their own "idea." It could be a preface to a full-on legal assault on Bitcoin (spurred on by the banks, the U.S. government, or both).

Re:Maybe the Patent Office will notice

[SuricouRaven]

Possible, but there's another explanation: Many companies just throw as many patents at the office as they can, including ones with no merit to them at all. The worst that can happen is rejection, for which there is no penalty at all, and even the most obviously junk patent has some shot of getting through. It may not stand up in court, but it can still be used to pad a portfolio.

Re:Maybe the Patent Office will notice

[Sarten-X]

Didn't they recently change patent law so that prior art is basically meaningless now?

No, they didn't.

First to file only matters if there are two patent applications in progress at the same time. Neither could have copied the other's final approved patent, since it wouldn't have been published yet... but applications may be published, and it's of course possible to release significant details of an invention before the patent is granted, so copying could occur, especially with modern communications.

Patents still must acknowledge the contributions of prior art, and show a significant (in the examiner's opinion) improvement to the state of the art. It still doesn't matter if Bitcoin came first, though, because JP Morgan's patent is not actually related to Bitcoin at all.

Re:Maybe the Patent Office will notice

[icebike]

Maybe the patent office will notice a bit of prior art? One can hope, right?

But its not bitcoin, and you can actually spend the money anywhere you want, because in the end it is
delivering real money to real accounts from other real accounts.

Negotiating a bitcoin sale or purchase is still like a scavenger hunt. Even if a willing buyer finds a willing seller the product is usually not exactly what they were looking for, close by, or convenient. There are maybe 5 restaurants in the world that will take bitcoin. And who wants to eat in a crowd of nerds.

Re:Maybe the Patent Office will notice

[omnichad]

First to file still considers prior art.

Re:Maybe the Patent Office will notice

[Cryacin]

But think of the levels of trust! SURELY, you would trust a treasured name in industry, over a rag tag bunch of pirates who choose to remain anonymous, right? Anyone would trust these guys with their money.

Re:Maybe the Patent Office will notice

[roc97007]

Everyone should have a dream.

Re:Maybe the Patent Office will notice

[Albanach]

Maybe the patent office will notice a bit of prior art? One can hope, right?

Or we could hope that you can't patent ideas, only implementations, and the summary is big on telling us why the ideas are similar, but scant on whether they share an implementation.

If someone invents a steam engine, it shouldn't mean someone else can't create a different steam engine that does the same thing in a different way. Similarly, just because bitcoin allows micro payments and electronic funds transfers doesn't mean no-one else can invent something that also achieves this.

I'm all for the patent office identifying prior art, but the summary is wanting when it comes to actually showing any.

Re:Maybe the Patent Office will notice

[amicusNYCL]

JP has the money to avoid that little inconvenience. This will go thru, and the will sue bitcoin.

How does one sue a currency?

Re:Maybe the Patent Office will notice

[roc97007]

> And who wants to eat in a crowd of nerds.

Not even other nerds.

Re:Maybe the Patent Office will notice

[icebike]

Yes, but I'm thinking more of USPTO process in this case. The patent can still be granted unless someone files a petition citing prior art. After that it may be invalidated based on Bitcoin existing, but my point it that it's still possible that the bank can receive this patent.

Except that it is almost exactly unlike bitcoin. Because it deals in real bank account and real money. Money you can spend anywhere.

The novel part is the fees-free micropayments, which will allow you to use things on the web without being flooded with ads for things
you don't want. Payments as low as factional pennies. Its a frangible currency.

However, SCOTUS is currently reviewing this whole field of "do something via computer" and get a patent, and the whole business practices thing is as likely to be tossed out or more tightly limited in the aftermath.
Coin is coin. And doing it by computer is not that new. Micro-payments are not that new. They were simply too expensive to deal with in the past.

Re: Maybe the Patent Office will notice

[MightyMartian]

Yeah, because no one cough...Rambus...cough would ever think of trolling standards group discussions to patent ideas that come out of them.

Re:Maybe the Patent Office will notice

[Derec01]

That's not how it works. First to file means that, given that two claimants of a patent, the first to file will get it. It does away with a messy process that incentivized holding on to trade secrets and delaying filing a patent as long as possible. First to invent can get incredibly messy and expensive to prove. Before some reform years ago, there was a practice known as submarine patents where applications would be submitted and withdrawn indefinitely, effectively allowing extended patent protection without disclosure.

If prior art is out there, the patent is invalid anyway in both cases. Quoth Wikipedia:

"Prior art (also known as state of the art, which also has other meanings, or background art[1]), in most systems of patent law,[2] constitutes all information that has been made available to the public in any form before a given date that might be relevant to a patent's claims of originality. If an invention has been described in the prior art, a patent on that invention is not valid."

Sure, maybe they'll get the patent. If it's the same as Bitcoin, it would be invalidated. First to invent vs. first to file doesn't really come into play here because no one else is trying to patent it.

Re:Maybe the Patent Office will notice

[Desler]

It doesn't matter. If the people behind Bitcoin never bothered to file for a patent, JP Morgan is now going to get it first--meaning Bitcoin will then be in violation of said patent (as unfair as that is).

That's not what first-to-file means, you Twit. First-to-file has to do with who gets a patent granted in the case of multiple application covering the same idea. And in fact, the scope of what could be used as prior art was broadened in the act that changed the system to first-to-file.

Re:Maybe the Patent Office will notice

[Eunuchswear]

The whole article is shit.

Patents don't protect what you want to do, they protect how you do it.

The article claims that JP Morgan have invented a system that does some of the same things that Bitcoin does, it gives no evidence that it does those things in the same way.

Re:Maybe the Patent Office will notice

[Sir_Sri]

By suing any company that accepts it in transactions as being in breach of their patent. The same way Newegg just got patent trolled by a company claiming a patent on (part of) public key cryptography. Oh you were using an implementation of our patent? You're going to get sued.

Re:Maybe the Patent Office will notice

[ackthpt]

Maybe the patent office will notice a bit of prior art? One can hope, right?

How are you going to show them a Bitcoin?

Re:Maybe the Patent Office will notice

[luciano.moretti]

It's the equivalent of paying someone by cutting your gold coin in half.

Re:Maybe the Patent Office will notice

[the eric conspiracy]

Applying for a patent is a negotiation process in which you throw out a bunch of claims looking to get the best deal you can. You start with Claim 1 being a claim on the sidereal universe and all it contains and work your way down to more specific stuff. Depending on the skill of those writing the patent you will get more or less of the invention you actually wanted.

As you can see in the application they have already dropped the first 154 claims in the original application.

Looking at the application it seems to me what is most interesting is the last claim.

That is:

A computer-implemented method of providing an anonymous payment from a mobile device to a payee device to enable an electronic payment between a payer and a payee without provision of an account number or name from the payer

So its a mobile anonymous untraceable payment, something that BTC doesn't address but something a lot of smartphone users would probably like.

Micropayments are discussed in the specification but aren't mentioned in the claims so are just some bullshit to make the examiner think this is cool new stuff or something.

Not really what the story is talking about, but that's not surprising since Slashdot is pretty weak on anything to do with patents.

Re:Maybe the Patent Office will notice

[meerling]

ianal, on the other hand, I've seen discussions on the change to the file first system, and they (actual patent lawyers) state explicitly that filing first in no way circumvents or invalidates prior art. So no, if their patent is basically bitcoin without mentioning bitcoin as prior art, they are up the creek without a paddle as soon as either someone fights it, or someone at the patent office pulls their head out of their ass.
So look at it this way, just because nobody has patented fire or throwing rocks, you can't either, it's already known and you did NOT invent it.

Re:Maybe the Patent Office will notice

[icebike]

Pieces of eight.

The thing is, reading some random web page is worth some fraction of a cent. And if a news story, or a blog post cost a quarter of a cent, (or less) and the authors would probably earn more money than by foisting ads on their readers.

The ads cost money (bandwidth, to both sender and receiver) to serve, integrate, and manage. A micro-payment with zero friction (no fees) could be just as cost effective.

If they can maintain the anonymity angle (and make it NSA proof) everybody gains. Its a great concept, long over due, and significantly different than Bitcoin. That doesn't mean I think it is patentable.

Re:Maybe the Patent Office will notice

[beelsebob]

But its not bitcoin, and you can actually spend the money anywhere you want, because in the end it is delivering real money to real accounts from other real accounts.

But this will then become invalidated based on the fact that europe has had the concept of free bank transfers for decades.

Re:Maybe the Patent Office will notice

[Theaetetus]

It doesn't matter. If the people behind Bitcoin never bothered to file for a patent, JP Morgan is now going to get it first--meaning Bitcoin will then be in violation of said patent (as unfair as that is).

That's not how first-to-file works. If the people behind Bitcoin kept Bitcoin secret, never published anything, never used it publicly, etc., and then (i) JP Morgan filed a patent application on it, and (ii) subsequently the people behind Bitcoin filed a patent application on it, then JP Morgan would win and get the patent - because, given two applications by two different inventors on the same invention, the first-to-file wins (hence the name). This is as opposed to the first-to-invent system, where in the above scenario, Bitcoin would win if they could show lab notebooks and internal documents showing that they actually invented it prior to JP Morgan and were working on reducing it to practice the whole time. Those proceedings were called interferences, and they occurred, on average, about 20 times a year. Out of half a million applications. That's literally all the change to "first to file" means, and those .004% applications are all that were affected. It has nothing to do with what's prior art or whether Bitcoin, which predates JP Morgan's application, can infringe any patent granted from it - and no, it can't. Not unless they change their implementation to incorporate something new that's in the JP Morgan application. If they freeze the implementation here, they can't possibly ever infringe.

Re:Maybe the Patent Office will notice

[Anonymous Coward]

you do know that "maybe yes; maybe no" is redundant, right? They maybe implies it could go either way

Maybe it does, and maybe it doesn't.

Re:Maybe the Patent Office will notice

[darkmeridian]

That's not what first-to-file means. Even if Bitcoin is never patented, the Patent Office can still (and should) reject the JP Morgan application based on the Bitcoin prior art. First-to-file means that if JP Morgan files first, the Bitcoin people cannot obtain priority over JP Morgan, as JP Morgan filed first despite inventing second.

Re:Maybe the Patent Office will notice

[ACE209]

Sometimes you have to take a risk.

Re:Maybe the Patent Office will notice

[Kevoco]

This.

Re:Maybe the Patent Office will notice

[Anonymous Coward]

If they do they'll have to go back to 1999.

As per the application:
"This application is a continuation of U.S. Ser. No. 09/497,307 filed Feb. 3, 2000 and is based on and claims priority to U.S. Provisional Patent Applications Nos. 60/132,305, filed May 3, 1999; 60/150,725, filed Aug. 25, 1999; 60/161,300, filed Oct. 26, 1999; 60/163,828, filed Nov. 5, 1999; and 60/173,044, filed Dec. 23, 1999, the entire disclosures of which are hereby incorporated by reference."

Since this application is a continuation of the Feb. 2000 application, the priority date for prior art is Feb 2, 2000. The provisional application dates can be used as priority dates for what they disclose. So at minimum you're looking for prior art disclosed before Feb 2, 2000 and at worst the examiner will have to look back to May 3, 1999.

And of course the specification doesn't mention Bitcoin. The entire specification was written probably written in late 1999 and January of 2000 when Bitcoin didn't exist. Continuations can't add any subject matter to the application (those are CIPs). The claims can differ, but they must be supported by the spec.

Re:Maybe the Patent Office will notice

[runeghost]

The patent office basically can't reject patent applications. Blame the megacorporate-captured American government, not the folks manning the desk at the patent office. http://www.slate.com/articles/technology/future_tense/2013/12/the_simple_fix_that_could_heal_the_patent_system.html

Re:Maybe the Patent Office will notice

[greensoap]

Actually the patent claims a relationship to patents going back to 1999. So the prior art needs to predate its priority to 1999.

Re:Maybe the Patent Office will notice

[greensoap]

Bitcoin is not going to be deemed prior art regardless. This thing is claiming priority through a series of applications back to 1999.

Re:Maybe the Patent Office will notice

[master5o1]

There was nothing to imply that GGGP was to remain hardened during the scenario.

Re:Maybe the Patent Office will notice

[master5o1]

If she performs anything like her acting.

Re:Maybe the Patent Office will notice

[Anonymous Coward]

You seem to mostly have a clue. But what everybody is missing here is that first-to-file has absolutely nothing to do with this patent. I repeat, nothing.

This application claims priority to an earlier-filed (pre-first-to-file) application. As such, none of those rules apply. The only thing matters is the priority date, and in this case it is at least as early as the year 2000, and could be as early as 1999. In any event, that is pre bitcoin.

But even if first-to-file was applicable here (and its not), it still makes absolutely no sense whatsoever. JP Morgan was the first to file. GAME OVER!!

Re:Maybe the Patent Office will notice

[mysidia]

Even if Bitcoin is never patented, the Patent Office can still (and should) reject the JP Morgan application based on the Bitcoin prior art.

Ah, but the patent filing date is in 1999. Apparently, the patent hasn't been issued yet, probably because claims the long running application make were overly broad,and the application hadn't fully gone through the system yet, but they are amending the patent claims on an existing application to cover Bitcoin.

The patent will probably be issued with a 1999 filing date, which means that for any prior art to invalidate the patent, it will need to have been before that date, not the date of the last amendment to the application.

Eureka! Interesting hack.... they turn out with a patent covering Bitcoin; or whatever new technology gets invented after their application 10 years later, that they can adjust the claims before patent issuance, to more effectively cover.

Strategic non-completion of the patent issuance process

Re:Maybe the Patent Office will notice

[mysidia]

Bitcoin is not going to be deemed prior art regardless. This thing is claiming priority through a series of applications back to 1999.

We need a law, that any patent application not approved within 3 years of the original application date, can no longer be amended; add, or drop claims, and if not issued within 4 years, will be deemed abandoned.

Re:Maybe the Patent Office will notice

[mysidia]

Really? They're going to sue a protocol?

For BTC to ever become mainstream; there will have to be point of sale equipment, and E-commerce players using it.

They can just sue point of sale equipment manufacturers, retailers, etc, dealing in Bitcoin.

Re:Maybe the Patent Office will notice

[Luckyo]

Ah yes, that OTHER "I have a dream" speech.

Re:Maybe the Patent Office will notice

[AK Marc]

If the people behind Bitcoin never bothered to file for a patent, JP Morgan is now going to get it first--meaning Bitcoin will then be in violation of said patent (as unfair as that is).

That's simply untrue. Bitcoin would lose the ability to patent their own invention, but the system is set up where prior art invalidates a patent. So someone couldn't patent the wheel and then sue everyone who uses wheels. It simply doesn't work that way.

Re:Maybe the Patent Office will notice

[murdocj]

You mean there can only be one? Sort of like the first company to create a GUI has the patent on all GUIs?

Re:Maybe the Patent Office will notice

[ultranova]

The thing is, reading some random web page is worth some fraction of a cent.

Except that no, it isn't. And it becomes even less so when spammers start setting up computer-generated search engine optimized money extractor pages.

And if a news story, or a blog post cost a quarter of a cent,

Then I won't be going anywhere near your blog or newssite unless I have some specific reason to. And let's face it, the chances are that I dont; I can wait for the rumour mill to do its job, and I'm definitely not paying for propaganda which opinion pieces - such as blogs - are.

Re:Maybe the Patent Office will notice

[rtb61]

Dude lame and old, next they'll be hunting down Mae West from the grave, talk about victim of meme marketing.

Let's not forget paypal in the whole bitcoin and pre-paid credit card mix. That's right what to cheat, simply pay with pre-paid credit cards, as anonymous, corrupt, bribery based and tax cheating as you can get.

Re:Maybe the Patent Office will notice

[righteousness]

That.
Those.
These.
They.
Yonder.

Re:Maybe the Patent Office will notice

[AvitarX]

Assuming the price you suggest is right, you're still cutting off a significant portion of readers to many types of things with the requirement, so it'd have to be optional.

I certainly would be OK with it, though ideally about half that maybe, I don't know what I'm worth in ads. If sites allowed this, it would simultaneously drive up the cost of placing ads, further helping to support sites.

Re:Maybe the Patent Office will notice

[AvitarX]

As I skim the patent, and look at the figures, I don't see how this has anything to do with bitcoin, am I missing something?

The entire thing looks tied into existing systems, pretty much the opposite of bitcoin.

Yeah, I don't care to read it all or understand it, simply was glancing to see if it at all resembled bitcoin. I didn't get far enough to see where they thought they did something innovative. It read like a whole lot of hypotheticals.

Re:Maybe the Patent Office will notice

[sotweed]

I think perhaps someone already did notice some prior art. It looks like 155 claims - the first 155 - were
already deleted, though it's not clear if it was the Patent Office or the applicant that did that. I bet there's a
good story behind that.

Re:Maybe the Patent Office will notice

[DrPBacon]

I'd trust Natalie Portman with my money.

Re:Maybe the Patent Office will notice

[robbak]

Applying for a patent is a negotiation process in which you throw out a bunch of claims looking to get the best deal you can. You start with Claim 1 being a claim on the sidereal universe and all it contains and work your way down to more specific stuff. Depending on the skill of those writing the patent you will get more or less of the invention you actually wanted.

As you can see in the application they have already dropped the first 154 claims in the original application.

And that is the main problem. When an inventor files a patent, it should be totally specific. If that patent is rejected, they should have two options: Argue that the patent as it stands is valid, involving the courts if necessary, or toss it out, and create a new, correct patent with a new effective date.

And if the way a patent is written could be read to cover some prior art, either before or after it is approved, then the patent is wrong and should be tossed, entirely, unless that prior art was explicitly listed in the 'prior art' section.

So this patent application should be the recipient of a junior-clerk's REJECTED stamp, because it doesn't explicitly list the Satoshi paper in it's applicable prior art section.

Re:Maybe the Patent Office will notice

[Capt.Albatross]

Maybe the patent office will notice a bit of prior art? One can hope, right?

Ask Patents might help with that.

Re:Maybe the Patent Office will notice

[FilmedInNoir]

I wouldn't trust her with a bowl of cheese grits though.

Re:Maybe the Patent Office will notice

[Xyrus]

Yeah! And maybe I'll get a blowjob from Natalie Portman, while eating a nice bowl of hot buttered cheese grits.

In this scenario of yours, which one of you is eating grits?

More importantly, which one of you is petrified?

Re:Maybe the Patent Office will notice

[CastrTroy]

Yeah, but start billing somebody every time they look at your page and you can guarantee that people won't be coming to your site very often, or the number of page views will go down quite a bit. The way I usually browse news sites (like Slashdot for instance), is that I scroll down the page and open 5-10 articles in new tabs. Then I read some of them, post comments in others, and close some I'm not interested in (or don't have time for). With advertising they're still getting paid even for the pages I didn't read. If I had to pay for every page I opened, I would be opening a lot less pages. It's like people saying Spotify doesn't give enough for each time a person listens to a track. Try to change the model so that you have to pay a fee for each song, rather than a flat fee for all you can listen to, and the amount of revenue you bring in will be a lot less. Sure artists will get more for each play, but they'll be getting a lot less plays. People certainly won't be leaving it on all day while they may not even be in the room.

Re:Maybe the Patent Office will notice

[JavaLord]

But think of the levels of trust! SURELY, you would trust a treasured name in industry, over a rag tag bunch of pirates who choose to remain anonymous, right? Anyone would trust these guys with their money.

Can we call it "Shitcoin"?

Re:Maybe the Patent Office will notice

[dkman]

So correct me if I'm wrong: You know you sent X amount of money to destination Y. Destination Y only knows it got X amount of money from JPMorgan, and doesn't care where it really came from because it's rolling in dough. JPMorgan knows that you gave X amount of money to destination Y, and will be more than happy to cough that information up upon court order. So what is the purpose of the "anonymous" claim? Because you don't want Y to know you gave them money?

Re:Maybe the Patent Office will notice

[SinisterEVIL]

wish i had a mod point for that one

Re:Maybe the Patent Office will notice

[GonzoPhysicist]

Gritcoins?

Re:Maybe the Patent Office will notice

[rpstrong]

mmmmmmmm . . . cheese grits.

Re:Maybe the Patent Office will notice

[icebike]

Yeah, but start billing somebody every time they look at your page and you can guarantee that people won't be coming to your site very often, or the number of page views will go down quite a bit.

But to-date, nobody has set up a payment method that is as easy to get into as the one proposed here, and you end up having to create accounts all over the web, give out credentials to people you don't trust etc. If I could do it one place, and expect to see minuscule page view rates I think you could sell it.

All of the current methods of doing this are simply too expensive to process and the web sites have an inflated concept of their value.

This is due to the current ad based revenue model where advertisers end up paying anywhere from 10 cents to 4 or 5 bucks per click, and web site developers earn virtually nothing on those clicks, and the rest flows to google.

The actual cost of a web page view is minuscule, and the actual earnings a company needs to make are similarly small, because the volume of hits means they can make money even at 100th of a cent, or even less.

I tossed out a quarter of a cent in my example above, but that is very much probably excessive.
It would be hard to measure on a site like Slashdot, because just defining what is a Page View is not clear due to all the
server transactions that occur in support of posting.

But on CNN, or the NYT, or any blog site you are interested in, I think I could justify paying somewhere between 1/100th and 1/10th of a cent per story view (not the landing page).

Most of the problems were addressed in a Stanford Study and they all center around the friction and transaction costs..

Re:Maybe the Patent Office will notice

[icebike]

Nothing in bitcoin can infringe this new patent application, because bitcoin is prior art.
Its up to the patent to avoid bitcoin features.

Re:Maybe the Patent Office will notice

[CastrTroy]

If it was viable, someone would have done it long ago. Look how much flack the Wall Street Journal got when they tried to implement a paywall. I could think of a very good way to implement it without incurring huge transaction fees. Let's say you are a payment processor, like PayPal, and there's a bunch of sites who want to set up paywalls, like newspapers, and a bunch of customers who want to visit the sites, like you and me. Now, you just have to have all the customers maintain some small balance on PayPal, like $5. There's a small transaction fee for getting the money into the account. The more money you keep in the account, the smaller (percentage) the transaction fee is. When you go to a site with a paywall, they redirect you to PayPal so that you can authorize the transaction, and then they redirect you back to the paywalled site with a key that the paywalled site can use to do a backend verification of the payment. Using browser extensions, this could probably be accomplished by a single click, or even seamlessly, assuming the customer set up rules for which sites they want to verify automatically. The paywalled site only gets the money once they have accrued enough visitors to make it worth the transaction fee to pull the money out, maybe even as infrequent once a month payments. So the middle man makes money on the transaction fees, plus they make interest on all the money they are holding on to.

The big problem here, is that now PayPal (or in the case of this article, JP Morgan) has a record of every page you payed to view. At the best case, they have a record of exactly how much money you spent at each site. So they would know if you read 1000 pages at The Enquirer (are they online?), or if you spent most of your time on Popular Mechanics. They could probably just wave the transaction fee completely, and make all the money they need off the interest from the balances of the site operators and site visitors, selling demographic data on who's paying for which site, and (I know, the irony) displaying ads on the payment verification page.

The big problem is that nobody wants to take the plunge and be the first website to force users to pay. Unless you have some really specialized content, there's a thousand other websites that have the same or very similar content available for free. People aren't willing to pay yet. I guess things could change in the future, but the site operators would have to offer a pretty good experience to convince people to pay actual cash. Even if it was just fractions of cent. Look at this site we're on right now. They'd have to stop posting dupes, actually editing the submissions and checking for correctness, and maybe even start accepting unicode characters if they wanted people to pay.

Re:Maybe the Patent Office will notice

[icebike]

There was no patent issued in the 1999 case. It wasn't successful.

The text of the patent lists other patents and applications dating back that far, but that doesn't mean you can bolt on new functionality to an old patent (let alone a failed application) and thereby extend your priority date into the past. It doesn't work that way.

They are simply stating that they relied on and are incorporating patents they already hold into this application ALONG WITH totally new functionality. That doesn't mean this new functionality always existed back to 1999. It doesn't mean that they can ignore more recent prior art.

Re:Maybe the Patent Office will notice

[KingBenny]

is this like where everyone in the U.S. gets to be punished for using bitcoin while the rest of the world happily continues with 'it' and the seventy altcoins, hereby effectively the 'congress' biting off one of its own paws in order to soothe the local elders ? I dont see a lot of impact coming from a bitcoin killer, it might live next to it

Being able to do the same things is irrelevant

[Anonymous Coward]

Just because this proposed currency is capable of doing many of the things that Bitcoin does, doesn't mean it copies Bitcoin.

Point out the technical components that copy Bitcoin, not the capabilities.

Re:Being able to do the same things is irrelevant

[Nemesisghost]

I'm trying to figure out when Fox News became a reliable news source. I was under the impression you only went to Fox News when you wanted to hear/see Right Wingers babbling like idiots, just the same for MSNBC for the Left.

Re:Being able to do the same things is irrelevant

[gmuslera]

The problem is when what it does is the thing patented, and that patent is used to forbid/request royalties/etc for something with prior art or of common sense. You know, like doing rectangular phones.

Re:Being able to do the same things is irrelevant

[Agent ME]

Yeah, I'm skimming the patent, and I don't see how this is like Bitcoin. It's not a decentralized currency. It's just a different interface for using existing bank accounts they control. It's only anonymous to the users. The whole system runs on trusted servers they control and can see what's happening on.

The stuff that made Bitcoin revolutionary isn't that it works over the internet, or has receive-only addresses. The revolutionary part was that it was decentralized. It didn't rely on any trusted or privileged groups or servers. All nodes that people run are equal. There is no central minting group who can secretly mint more or change the minting rules. The currency itself is limited. This proposal does not involve any of that.

Re:Being able to do the same things is irrelevant

[freeze128]

A few years ago, I was able to transfer funds from my savings account into a friend's account because we used the same bank. I liked this because it was simple and straightforward. Of course the bank will transfer the funds... It's just moving numbers, and no real money even needs to leave the bank.

I now take you to late 2013, and I wanted to do the same thing again, but this time found that I had to "Sign up" for some service that would allow me to "Send money to anyone with an email account". I didn't want to sign up, and I CERTAINLY didn't want to provide the source and destination EMail addresses. I wanted to move money around inside the bank, and now it seems that isn't possible anymore. Maybe this JP Morgan system will bring that service back.

Re:Being able to do the same things is irrelevant

[rduke15]

That sounds so weird that it is hard to believe.

If you cannot transfer money to your friend's account, how can you transfer any money to any account? And if you cannot transfer money to another account, then why do you have a bank account at all? That doesn't make sense.

Maybe what you mean is that you could do it free of charge, and that now there is a small transaction fee, even if both accounts are in the same bank?

Or maybe the redesigned their web pages and you didn't find the correc page page for transfers to another account?

Re:Being able to do the same things is irrelevant

[cusco]

It's JP Morgan. The only way that will come back is if they can charge 10-15% fee, the same as they do their money laundering, er, 'private banking' services. You'd be better off going to the cash machine, taking the cash out, handing it to him, and letting him deposit it into the same machine. They're not charging a fee for that again, are they? I left them when they started charging for our "permanently free" checking account.

You could probably do it at a credit union. They're owned by their customers, not shareholders, so have to keep their customers' wants and needs in mind.

Re:Being able to do the same things is irrelevant

[jonwil]

Here in Australia I can transfer money not only to my bank but to any other bank in Australia (via my online banking) and I dont pay a cent.
I can also pay bills (those that dont come out automatically via direct debit) online and I dont pay a cent.

Re:Being able to do the same things is irrelevant

[Falconhell]

You don't have a left, you have far out loopy extreme right, (Fox news) and hard right (MSNBC).

Re:Being able to do the same things is irrelevant

[Falconhell]

Exactly, as and Aus resident I often wonder how the US puts up with its diabolically hopeless banking system.

Re:Being able to do the same things is irrelevant

[Rich0]

Yup. If you don't mind trusting a central authority then there is a completely anonymous alternative to Bitcoin and that is digital cash.

It is a sound technology rooted in crypto that has been around for ages. It allows a trusted bank to issue currency that can be freely exchanged in an anonymous fashion online and then redeemed back with the bank. That is, the bank could give me a string of bytes worth $10, which I could then use to give you a different string of bytes, and then you could give the bank that string of bytes and get $10 deposited into your account, but the bank would not be able to tell where that string of bytes originated, but they could be sure it is authentic.

For whatever reason I can't find a good description online. The concept is that the individual actually creates the currency and encrypts it, and then the bank signs it blindly to make it authentic. The signature is such that it remains valid if the message is decrypted, so the currency can then be used without the bank being able to associate the currency with what it signed. The obvious weakness is how the bank knows what it is signing, and that is done by having the currency creator issue a large number of identically valued pieces of currency, and then the bank asks for the decryption keys to all but one of its choosing. If the currency it verifies is valid then it assumes that the one it couldn't read is valid and signs it. There is no real chance of getting away with forging money as a result (the bank could ask you to generate a million $20 bills and only sign one of them, so you'd have to guess which of the million ones to forge and there would be ramifications if you were caught doing it).

This is much more anonymous than Bitcoin - it works just like bills in circulation. However, it relies on a central bank, which can issue all the currency it wants to. It is superior to cash in most ways, but it isn't useful for offline transactions, because currency can be copies and only the first copy that makes it to the bank is valid (so be sure to deposit that cash before calling the sale done).

Re:Being able to do the same things is irrelevant

[gl4ss]

" It's just a different interface for using existing bank accounts they control. It's only anonymous to the users."

I hate to break it to them but that's how electronic banking in Finland worked prior to the banks setting up the systems to see names on the account numbers automatically(and you could even use friggin telnet or dialup to make transactions).

micro transactions too... well, as micro as 1 finnish penny anyways.

so uh taking away features = worth patenting now?

Has nothing to do with bitcoin.

[Anonymous Coward]

The patent is a near-exact description of how paypal works.

Re:Has nothing to do with bitcoin.

[twistedcubic]

You're missing the point. Businesses who do transactions with Bitcoin might be sued for infringing claims in the patent, even if the patent itself has nothing to do with Bitcoin. I read the patent and couldn't find anything I recognized as new. Just a very detailed description of a simple electronic financial transaction. The detail given seems to try to obscure instead of clarify, in my opinion, because there is so much of it that is not necessary. An excerpt from claim 155 of the patent:

...storing, in a computer memory at a host server, payer information and instructions; and accessing the computer memory using a computer processor to retrieve the payer information...

Now, is there an electronic financial transaction which does not infringe on this?

Re:Has nothing to do with bitcoin.

[Jayfar]

The patent is a near-exact description of how paypal works.

Minus the ridiculous fees no doubt.

Re:Has nothing to do with bitcoin.

[Jah-Wren Ryel]

The detail given seems to try to obscure instead of clarify, in my opinion

Having skimmed the patent, I agree. I do not regularly read patents, but it is my understanding that software and process patents like this regularly suffer from this problem - they attempt to obfuscate as much of the details as possible in order to make the claims as broad as possible and to make it as difficult as possible for anyone to do anything useful with the information in the patent.

Nevermind the question of whether software patents are valid or not, this obfuscation is in direct contradiction with the intent of the patent system - to trade a monopoly in the technology for the publication of the information necessary to reproduce the technology.

Re:Has nothing to do with bitcoin.

[rsborg]

The patent is a near-exact description of how paypal works.

Minus the ridiculous fees no doubt.

Are you kidding me? Banks:Fees::Zombies:Brains

Non-Story

[Anonymous Coward]

Bitcoin did not invent electronic money transfers. This is sort of like saying the trackball violates the patent on the mouse.

Like bitcoin?

[Anonymous Coward]

BitCoin is not anonymous, and it does have fees. How is it just like BitCoin?

For the billionth time

[Ultra64]

>The system would allow people to pay bills anonymously over the Internet through an electronic transfer of funds â" just like Bitcoin.

Bitcoin is not anonymous. There is a very clear, public trail linking your wallet to your purchases.

Re:For the billionth time

[fuzzyfuzzyfungus]

>The system would allow people to pay bills anonymously over the Internet through an electronic transfer of funds â" just like Bitcoin.

Bitcoin is not anonymous. There is a very clear, public trail linking your wallet to your purchases.

Yes; but (unlike, say, credit cards) anybody can magic a wallet into existence with a dash of math, at any time, so connections between people and wallets are established only by inferences made possible by various forms of sloppiness in handling. Odds are that many wallets are robustly identified with users; but only on the basis of techniques unrelated to bitcoin proper.

Re:For the billionth time

[twistedcubic]

The "anonymous" in the patent claim is not anonymous either. It refers to using an "address" which is anonymous in the sense that it is not obviously tied to any personal information. It is less anonymous than Bitcoin even, if my reading of the patent is correct.

BitCoin not first

[ZombieBraintrust]

BitCoin is not the first electronic payment system. No reason for patent to metion BitCoin unless it JPMorgan is going to have people mining for Morgon bucks.

Re:BitCoin not first

[c0lo]

BitCoin is not the first electronic payment system. No reason for patent to metion BitCoin unless it JPMorgan is going to have people mining for Morgon bucks.

If you are scared about the mining of Morgon bucks, what would you say about the rubber coins one can strech well beyond six thousand eight hundred miles along each side (even though, in principle, it's not different from stretching sub-prime mortgage-backed bonds until they break and betting they will break sooner or later)

Something is wrong with the entire system

[Overzeetop]

Something is wrong with the entire system when a financial company is awarded a patent.

Re:Something is wrong with the entire system

[i kan reed]

I'm sorry, the fixed rate loan has been patented by a competitor, so we can only offer you APRs that go up by 30% a day.

Re:Something is wrong with the entire system

[SuricouRaven]

The US allows patents not just on software, but on business methods too. JPMorgan probably has a great many business patents.

Re:Something is wrong with the entire system

[Sarten-X]

Why? Why does one's industry determine whether they can contribute an innovation to the world?

The patent is for a mechanism to make payments from an account by both sides exchanging possibly-anonymized information. What other industry would you expect this idea to come from? Agriculture?

Re:Something is wrong with the entire system

[_anomaly_]

The sad part is that a lot of people said "OK".

Trolling

[Sarten-X]

Troll summary for a troll article.

The patent has nothing to do with Bitcoin. It's a payment processing system that's set up so it can use anonymized IDs rather than actual account numbers.

Re:Trolling

[Apothem]

Sounds like they're trying to patent a way to make it easier to launder their money.

Re:Trolling

[presidenteloco]

"so it can use anonymized IDs"

kind of like, say, bitcoin addresses:

"A Bitcoin address, or simply address, is an identifier of 27-34 alphanumeric characters, beginning with the number 1 or 3, that represents a possible destination for a Bitcoin payment. Addresses can be generated at no cost by any user of Bitcoin. For example, using Bitcoin-Qt, one can click "New Address" and be assigned an address. It is also possible to get a Bitcoin address using an account at an exchange or online wallet service."

Re:Trolling

[Sarten-X]

Hardly. The system itself would still be able to track where money came from well enough for law enforcement. It'd just be a bit safer to give out direct payment information online.

Re:Trolling

[Sarten-X]

Yes, kind of like Bitcoin addresses, but without the rest of the Bitcoin architecture. Instead, the concept is adapted to fit a more traditional banking system, which is usually rather biased against working with temporary or disposable anything.

Anecdotally, while working in finance I helped set up a corporation for the sole purpose of selling a single house. The account had to stick around in our systems for 90 days, to accommodate a nonzero balance for about an hour.

Re:Trolling

[blackraven14250]

I should patent "A Method for Ensuring Submission Acceptance on Slashdot", with the claims being "Create false association between news article and Bitcoin" and "Ensure Bitcoin is featured prominently in submission title".

Re:Trolling

[Lehk228]

which is exactly the same as the throwaway credit card numbers offered by many institution. the patent system is really just a circular human centipede eating it's own shit.

Re:Trolling

[Rich0]

Why not just use digital cash - the kind that was invented back in the 90s. That is completely anonymous and untraceable, but it relies on having a bank that issues the currency and then deposits it when it changes hands. Like cash it can be stolen though - it really IS anonymous and untraceable so don't let somebody else get a copy of your money or you'll find it spent when you go to spend it.

Re:Trolling

[martin-boundary]

You don't get it. If you're going to get a patent for solving a problem, it better be an unsolved problem. I don't care if you're using a widget of type A instead of a widget of type B in Step 12, if the problem already has a solution, you don't deserve a patent for solving the problem again in a different way.

There are too many patents out there. We need to radically cut down on the ones being granted, and to radically invalidate the vast majority of existing ones. It's the only way the sciences and arts will progress.

Re:Trolling

[Sarten-X]

I don't care if you're using a widget of type A instead of a widget of type B in Step 12

...but the problem being solved is "How do I accomplish this task without using a type B widget?". Those B widgets may be more expensive than A, or perhaps they have some reliability problems, or maybe a type-A widget is already in use elsewhere in a commercial product, and changing the part in step 12 lowers the number of distinct parts enough to save on the manufacturing process.

The patent office is not, and has never been, an authority over which problems are worth solving. Per the "usefulness" requirement, patents must indeed solve some problem, but the USPTO intentionally doesn't try to predict what tiny change will be a groundbreaking technological improvement over the next several decades.

Re:Trolling

[martin-boundary]

...but the problem being solved is "How do I accomplish this task without using a type B widget?". Those B widgets may be more expensive than A, or perhaps they have some reliability problems, or maybe a type-A widget is already in use elsewhere in a commercial product, and changing the part in step 12 lowers the number of distinct parts enough to save on the manufacturing process.

That's *tweaking* an existing solution, not solving a *new* problem. Everyone who has a STEM degree is trained in tweaking existing solutions to known problems. That's what most homework assignments in STEM are: "Solve existing generic problem X that you learned about in class, but don't use step 12 here."

The patent office is not, and has never been, an authority over which problems are worth solving. Per the "usefulness" requirement,

I beg to differ. One cannot assess originality and obviousness to practicioners of the art, without making an implied judgment about the worthiness of a problem's solution.

In the simplest terms, say I look at a proposal, and determine that it would take 5 minutes of work for me or my colleagues to come up with this. Then I don't consider the solution to be worth even writing up. It's something I would do incidentally, as a single step while working towards a more ambitious goal. That's not worth a patent.

And yet, if that same solution is dressed up in fancy language that obfuscates the specifics and is given to some patent examiner who covers a large range of applications in a variety of fields, I am now legally prohibited from independently solving this same incidental problem in a product I'm developing, because some company on the other side of the world paid a fee to register this idea as theirs for the next 20 years only 6 months ago.

Just like BitCoin?

[Bogtha]

The system would allow people to pay bills anonymously over the Internet through an electronic transfer of funds â" just like Bitcoin.

Bitcoin isn't anonymous.

It would allow for micropayments without processing fees â" just like bit coin.

Processing fees are common with Bitcoin.

And it could kill off wire transfers through companies like Western Union â" just like Bitcoin.

Wire transfers are largely an oddity of the USA. Most of the rest of the world doesn't use wire transfers anyway.

Re:Just like BitCoin?

[fox171171]

Wire transfers are largely an oddity of the USA. Most of the rest of the world doesn't use wire transfers anyway.

Don't forget about Nigerian Princes...

Re:Just like BitCoin?

[xaxa]

Wire transfers are extremely common the world over. The oddity is that in the U.S. it's easier for individuals to do, and that's because most other countries police wire transfers more heavily.

I expect GCHQ know that my electricity costs £33/month, but the process is extremely widespread, free (for me), and very easy to set up, either for paying bills (of fixed or varying amounts), or sending money to individuals.

There's apparently a default limit of £10k/day, but that's the bank (who will change it if asked), not the law. Regulations are only for international or "suspicious" transfers, and that applies to Western Union as much (probably more...) than Barclay's.

Re:Just like BitCoin?

[tonymercmobily]

> Wire transfers are largely an oddity of the USA. Most of the rest of the world doesn't use wire transfers anyway

Excuse me? Wire transfer in Australia are called EFT. Basically, if you want to give money to _anybody_ in Australia, all you need is their BSB (6 digits, it's the bank's ID) and account number, and there you are, money gets there 24 hours later (48 hours later if you make the transfer after 5:00PM in Sydney, which is the cut-off time).

It's WIDELY used by businesses, and even people. I "borrowed" $50 from a friend yesterday, and simply transferred $50 via Internet Banking using my phone.

I was amazed to discover that the US was largely based on *cheques*.

Re:Just like BitCoin?

[mythosaz]

A check is a piece of paper that contains your routing number and account number.

Nobody actually writes paper checks for anything except paying their FIRST bill with a company -- so that the account number and routing code can be re-used for automatic EFT billing. The occasional grandmother-writing-birthday-check and paying-the-babysitter-check get written, but NOBODY born in the last 40 years uses a checkbook any longer for anything other than the OCCASIONAL weirdo at the grocery store holding up the line.

The only people taking checks on payday are the working poor, who inexplicably take them straight to a check cashing store to turn them into cash. A process I'll never understand.

Re:Just like BitCoin?

[javajawa]

Wire transfers are largely an oddity of the USA. Most of the rest of the world doesn't use wire transfers anyway.

Say what? I process wire transfers to Europe and Asia on a daily basis... they actually have better infrastructure for it in the rest of the world. IBAN/SWIFT

Re:Just like BitCoin?

[the eric conspiracy]

TELL MY EMPLOYER.

He still MAILS a paper check to all of his employees twice a month. AND it's a software company. HOLY DISSONANCE BATMAN.

Re:Just like BitCoin?

[tftp]

Your employer has a right to risk that his checks are lost in the mail; and he has a right to pay for printing, signing, and mailing those pieces of paper.

Every sane payroll services company offers direct deposit. It is not difficult to set up, and it is better in every aspect.

Re:Just like BitCoin?

[Rich0]

EFT exists in the US - it isn't the same thing as wire transfer.

There was a good NPR episode on this recently.

The issue is that the US EFT system (called ACH or the Automated Clearing House) is a batch-based system that involves several days (err, BUSINESS DAYS!) of latency. It was invented at a time when this was actually an advance over checks and back then literally involved transporting reels of tapes (as opposed to bags of checks). Today it works like you'd expect a more modern operation to work, aside from daily batching, shutdowns during off-hours, etc.

Banks have opposed improving the US EFT system, in part because it would cost them money to implement any changes, but mostly because they can make a fortune charging for wire transfers when you don't want it to take several days to send money around. Wire transfers usually take seconds, like ordinary money transfers anywhere else, and they cost tens of dollars each.

I do pay my bills electronically though via EFT. It just takes a day or two for payments to get through (and sometimes it takes a week if the bank actually does have to cut a check).

Re:Just like BitCoin?

[Rich0]

Keep in mind that what the US calls "EFT" and what the rest of world calls "EFT" is a bit like the difference between what kids listened to music on in the 80s vs today.

Re:Just like BitCoin?

[bruce_the_loon]

What the GP is calling a wire transfer isn't what we civilized bankers call EFT, it is the Western Union telegraph-style transfers. You pay Western Union, get a unique ID code and send that to someone else who with that ID code can receive cash from another Western Union office elsewhere in the world. No destination bank account needed. That's what is referred to in literature and old movies as "wiring someone the money"

What we, the non-US bankers, call wire transfers are interbank transfers as you describe. In the old days before internet/ATM banking, you'd fill in a form and the bank would transfer the funds electronically via the dedicated wire links between them. We now call them EFTs because the entire process is electronic. Banks should just scrap all their historically-derived terminology and settle for something simpler.

Re:Just like BitCoin?

[dave420]

Those are not wire transfers. Wire transfers are between people via an intermediate actor, whereas bank transfers are between accounts between banks.

Re:Just like BitCoin?

[Cro Magnon]

99% of my transaction are online. But I still write checks to the guy who mows my lawn.

Re:Just like BitCoin?

[the eric conspiracy]

> If you are a small business paper checks still make better financial sense because they cost less than a payroll services company.

That argument would work except for one thing. HE USES A PAYROLL SERVICES COMPANY to prepare the checks!!

Re:Just like BitCoin?

[tftp]

If you are a small business you simply cannot afford to NOT use a payroll company. Is it your core competence to study obscure and ever-changing tax laws in your city, county, state, and federal? Is it your core competence to deal with tables of withholding? Is it your core competence to even know about payroll tax, or risk impossible fines in case you, the owner, failed to note something that IRS clearly explains only to CPAs? Or, perhaps, your core competence is something else - programming, enginering, design?

This has nothing to do with Bitcoin

[tftp]

The patent does mention "digital cash," and BTC is that. However the patent is not about creating new coins from thin air. The patent is simply about software that allows you to pay using your existing accounts with banks (they mention c/c.) The payment, however, is anonymous, and very cheap. That's all.

Re:This has nothing to do with Bitcoin

[mlts]

Wonder if it might overlap with some of Chaum's anonymous currency patents. His venture didn't last long, but the underlying concepts of the currency were sound and it provided true anonymous transfer of money without relying on blockchains or "majority rules".

Re:This has nothing to do with Bitcoin

[ArcadeMan]

Banks are not about creating coins from thin air? What do you think the bank bailouts were?

If you patent prior art, I feel bad for you son.

[gandhi_2]

It's got 18 thousand word, but a 'bit' ain't one.

Hah now they'll sue

[BigSlowTarget]

"Now we sue Bitcoin and shut them down. (whispers) They don't have lawyers? Excellent! (whispers) What do you mean they don't exist as an entity?(whispers) Distributed what?! (whispers) Damn those techies. They can't do that. Don't they understand real business?"

Read the claims before making them

[Anonymous Coward]

From the patent claims: "enable an electronic payment between a payer and a payee without provision of an account number or name from the payer"

Bitcoin is not capable of this. Nice try, internet.

without processing fees at chase bank?

[Joe_Dragon]

Don't banks love to fee stuff up a lot.

Re:without processing fees at chase bank?

[rickb928]

Their purposes are to: (repeat after me)

- Provide services
- For a profit

Any questions?

Re:without processing fees at chase bank?

[dave420]

They make money hand-over-fist from the money they have sitting in their accounts. This weird notion of banks charging for everything seems peculiarly American.

Re: without processing fees at chase bank?

[rickb928]

Current interest rates don't seem to back that proposition

This isn't bitcoin, or a cryptocurrency

[earlzdotnet]

Yea, the reason they don't mention bitcoin is because this is nothing like bitcoin. This isn't a cryptocurrency. This assumes that behind the scenes a bank is tied to your account to push/pull funds from. This incorporates some of the things bitcoin is good at, but it does it all in a completely different manner. If you'd take a look at the patent application, you'd know this is in no way close to bitcoin

Re:This isn't bitcoin, or a cryptocurrency

[GerryGilmore]

I agree - this sounds much more like, say, mPesa which allows cash transfers using mobile phones. Wildly popular and growing like mad in Africa.

Comment removed

[account_deleted]

Comment removed based on user account deletion

Re:Is there a snowball's chance this would work?

[nurb432]

Well, they would be using their patented technology, so yes they can ( and will )

Re:Bitcoin is crap

[nurb432]

Sounds like the stock market, and that seems to be taken seriously.

Significant advancement in art

[Anonymous Coward]

"One essential feature of the present invention, completely contrary to the prior art, is that payments made from the IPA account are transmitted to the payee as a credit over the secure EFT network. As discussed above, only debit related transactions are currently initiated on the EFT system. The EFT credit message of the present invention thus represent a significant advancement in art which has no peers with respect to electronic commerce. "

In effect, they have created "credit" push messages in the EFT network. It sounds a lot like a small extension of the square "email payment" system combined with some extension of the EFT network (reversal?) to keep transactions "anonymous".

NOTHING like Bitcoin

[harvestsun]

The point of Bitcoin is that it's decentralized. There's no single entity that keeps track of what money is where. Every person who uses Bitcoin has a record of every transaction (in the form of the blockchain), and is involved in the process of verifying transactions (in the form of bitcoin mining). Although the security is still being debated, in theory, you would need to control half the computing power of the Bitcoin network in order to break the security.

In contrast, this patent seems to be talking about a system that uses your same old credit card account. Which is not surprising; how would a BANK use a DECENTRALIZED currency system with its customers?

So basically, this is a meaningless article written by some idiot at Fox News who wanted to make a headline that would stand out. Which I suppose worked, since it made it past the impeccable Slashdot editing process.

Re:NOTHING like Bitcoin

[harvestsun]

HA, let's not be hasty. I'm actually pretty far right-wing, and I'm not saying Fox News is the only source of idiots; just that IN THIS CASE, the two idiots involved were from Fox News and Slashdot.

The quality of most online news is pretty shitty, because authors are paid for the number of views they generate. So there is a lot of incentive to write a lot of articles with interesting headlines, and little to no incentive to actually learn what the hell you're talking about.

Re:Is there a snowball's chance this would work?

[game kid]

Big bankers don't get jail time or substantial fines for perjury or other criminal acts here, so yes. There's a snowball's chance, and enough additional snowballs where that came from that Hell will be inhabitable.

Grab your bitcoin wallet, your lawyer, and your ass. When an already powerful bank goes patent troll you may well need them all and in that order.

Anyone check the IDS? Duty to Disclose

[ProfBooty]

Anyone check the IDS?

Applicant has a duty to disclose (See MPEP 2001) any and all prior art that they are aware of at the time of filing.

Per MPEP 2001.01

(c) Individuals associated with the filing or prosecution of a patent application within the meaning of this section are:
(1) Each inventor named in the application;
(2) Each attorney or agent who prepares or prosecutes the application; and
(3) Every other person who is substantively involved in the preparation or prosecution of the application and who is associated with the inventor, with the assignee or with anyone to whom there is an obligation to assign the application.
*****

Individuals having a duty of disclosure are limited to those who are “substantively involved in the preparation or prosecution of the application.” This is intended to make clear that the duty does not extend to typists, clerks, and similar personnel who assist with an application.

This predates Bitcoin

[Animats]

The original application on which this is based is dated May 3, 1999. So this predates Bitcoin. Only prior art earlier than the priority date is relevant.

The life of the patent counts from the priority date, so this patent, if issued, will run out in 2019. The USPTO doesn't consider this patent to contain patentable subject matter; they've issued a 101 Non Final Rejection. (You have to look up the patent application in USPTO Public PAIR to see this. Public PAIR has the status info for all patents as they go through examination, and images of all the actual documents. All the letters and forms back and forth between the applicant and the USPTO are in there. PAIR is kind of slow, and there's a CAPTCHA to prevent it from being scraped in bulk, so the data in PAIR isn't indexed by search engines.)

Re:Sounds Like Paypal's eCheck

[omnichad]

Exposed public address...to receive payments. An account number? I may be American, but isn't that the way Europe handles cash transfers from one bank to another?

Re:Bitcoin is crap

[SuricouRaven]

True. Can't use it as a value store, but it seems to have found a niche for use in transfers. Party A buys bitcoin for dollars, transfers coin to party B, party B buys dollars with bitcoins.

What could possibly go wrong?

[PopeRatzo]

I'm not sure that giving JPMorgan a patent on money is a good idea. Just sayin'...

Re:In 2013,

[viperidaenz]

Except they didn't because the two systems are completely different. Someone read the title of a patent without reading any content and jumped to conclusions. Welcome to the Internet.

Re:If you patent prior art, I feel bad for you son

[viperidaenz]

If it contains prior art, Bitcoin isn't it.

Really?

[Jawnn]

There are 18,126 words in the patent application. 'Bitcoin' is not one of them."

So /. could take a lesson from JPMorgan's patent lawyers, then, and STFU about bitcoin already.

Re:Is there a snowball's chance this would work?

[Sarten-X]

No, they can't.

The patent claims describe a very specific architecture that is completely unrelated to the distributed system that Bitcoin uses. By design, the bank running the system approves transactions unilaterally through its own system.

Re:Bitcoin is crap

[maxwell demon]

Sounds like the stock market, and that seems to be taken seriously.

But not as a currency.

Have some time to help nuke JP Morgan on this?

[Sir Holo]

From the USPTO PAIR database, "By this preliminary Amendment, claims 1-154 have been canceled..."

154 claims canceled?!? Typical patents have around 21 claims. USPTO charges per-claim over 21 total claims. JP Morgan's application had 170 claims — way beyond even a 3-sigma deviation for all patent applications. That is, it's amateurish. But, somehow they managed to avoid paying the $80/each for the excess claims. Most rejections were nominally due to the claims being "too abstract."

So, anyways, from the USPTO PAIR database — JP Morgan are claiming that their filing is under pre-AIA conditions. That is, that they are first to invent, and are not subject to the current first to file rules. Big difference. The inventor filed an "oath" regarding the invention date. Uh huh. USPTO also says, "Claims 155-175 are allowed over the prior art of record based on the earliest priority of the parent applications." I couldn't find the priority date that they are claiming, or whether it is before their filing date, but one might guess they are trying to get a pre-BitCoin patent priority date. Jerks. Once a patent is allowed and issued, any challenge to their priority would face a high hurdle, and would be expensive to prosecute.

If only someone knew of some actual prior art, and that this person also knew the name and contact information for the patent examiner. Hmmn...

Ah, here we are: From their non-final rejection, "Any inquiry concerning this communication or earlier communications from the examiner should be directed to JAGDISH PATEL whose telephone number is (571) 272-6748." I'm sure he has an email address as well.

Good luck, and if no one here is willing to help nuke this, I'll send it over to the 4chan trogs.

Last, below is the Public PAIR filing-documents web address. Go there and search for "Publication Number" 20130317984. Click the "Image File Wrapper" tab to see PDFs of all communications between JP Morgan and the USPTO. Happy hunting!

http://portal.uspto.gov/pair/PublicPair

Re:Have some time to help nuke JP Morgan on this?

[sir_eccles]

Of course he doesn't know what he is talking about, very few who have commented so far appear to know anything about patents. This is nothing new or suprising for slashdot.

Re:Have some time to help nuke JP Morgan on this?

[Dachannien]

A preliminary amendment filed on the filing date along with the application can avoid excess claims fees. In other words, they filed a continuation that included claims 1-154 (because a continuation is supposed to have all the same stuff that the parent has, and this ensures that there is written description support for the parent's original claims in the child case), but then they amended the claims on the same day to cancel those claims and only present claims 155-175 (21 claims). So they owed us $80 for one excess dependent claim, which they paid.

Also, there are ways to submit third party prior art submissions into an application. You would have until 5/28/2014 (six months after publication) to submit such prior art. There's even a fee exemption if you file only one such submission and it has three or fewer documents listed. This is a much better idea than trying to contact the examiner directly, since they are forbidden from discussing the application with an unauthorized party.

When did Bitcoin destory Western Union?

[wonkey_monkey]

And it could kill off wire transfers through companies like Western Union — just like Bitcoin.

There are all manner of things Bitcoin could do, but I don't think it's succeeded at this one yet.

Re:Is there a snowball's chance this would work?

[viperidaenz]

That would be a great way to get their patent invalidated and waste a whole lot of money on legal costs.
How exactly would they expect to sue someone over a patent filed years after someone was already doing something publicly?

A more likely scenario is this is to scare/stop other companies leveraging existing payment networks to capitalise on 'anonymous' funds transfers.

Kill The Patent

[pubwvj]

1) Bitcoin is prior art invalidating JPMotherfkr's patent.

2) The Supreme Court is seriously considering killing these types of patents and hopefully will.

Re:Kill The Patent

[pubwvj]

Patent is now.
Bitcoin is past.
Ergo, prior art.
Enough of this filing patents on things and doing nothing with them, just waiting for them to be used.

Besides. See point two.

Perhaps

[tompaulco]

Perhaps the reason they didn't mention bitcoin is that the patent is not an attempt to kill bitcoin or an attempt to compete with bitcoin and does not have the words "bitcoin killer" attached to it in any way other than by the article submitter, who is probably hoping to drive down bitcoin prices so he can buy low.

Laugh

[koan]

What makes you think JPMorgan isn't Satoshi Nakamoto?

Not via the methods you suggest...

[Theaetetus]

From the USPTO PAIR database, "By this preliminary Amendment, claims 1-154 have been canceled..."

154 claims canceled?!? Typical patents have around 21 claims. USPTO charges per-claim over 21 total claims. JP Morgan's application had 170 claims — way beyond even a 3-sigma deviation for all patent applications. That is, it's amateurish. But, somehow they managed to avoid paying the $80/each for the excess claims.

It's actually pretty standard in many instances - i.e. there's nothing amateurish about it. Specifically, if someone comes up with a half dozen related-but-different inventions, it may be more efficient to write one giant application than a half dozen applications that repeat parts of each other. That one giant application may then have [drumroll] 170 claims. And when you file it, you actually file one and cancel claims 21-170 in a preliminary amendment on the filing date, "somehow managing to avoid paying the excess claims fees". And then later (or at the same time), you file a divisional application and cancel claims 1-20 and claims 41-170. And another canceling claims 1-40 and 61-170. Etc.

Let me guess... in spite of your description of this standard practice as "amateurish", you're not a professional in the field?

So, anyways, from the USPTO PAIR database — JP Morgan are claiming that their filing is under pre-AIA conditions. That is, that they are first to invent, and are not subject to the current first to file rules. Big difference. The inventor filed an "oath" regarding the invention date. Uh huh.

Well, yeah. This was first filed in 1999, long before the first to file rules. Of course it's subject to the first to invent rules. 1999 vs. 2013? Big difference. Uh huh.

USPTO also says, "Claims 155-175 are allowed over the prior art of record based on the earliest priority of the parent applications." I couldn't find the priority date that they are claiming, or whether it is before their filing date, but one might guess they are trying to get a pre-BitCoin patent priority date. Jerks.

You apparently couldn't find paragraph 1 of the application:

[0001] This application is a continuation of U.S. Ser. No. 09/497,307 filed Feb. 3, 2000 and is based on and claims priority to U.S. Provisional Patent Applications Nos. 60/132,305, filed May 3, 1999; 60/150,725, filed Aug. 25, 1999; 60/161,300, filed Oct. 26, 1999; 60/163,828, filed Nov. 5, 1999; and 60/173,044, filed Dec. 23, 1999, the entire disclosures of which are hereby incorporated by reference.

Gosh, being really clear about the priority dates? What a bunch of jerks.

If only someone knew of some actual prior art, and that this person also knew the name and contact information for the patent examiner. Hmmn...

Ah, here we are: From their non-final rejection, "Any inquiry concerning this communication or earlier communications from the examiner should be directed to JAGDISH PATEL whose telephone number is (571) 272-6748." I'm sure he has an email address as well.

Yeah, go ahead and call the Examiner, in spite of the fact that it's explicitly illegal without a letter of authorization from the patent applicant:

[T]he Office prohibits third parties from submitting any protests under 37 CFR 1.291 or initiating any public use proceedings under 37 CFR 1.292 (without the express written consent of the applicant) after publication of an application... Office personnel (including the Patent Examining Corps) are instructed to: (1) not reply to any third-party inquiry or other submission in a published pending application; (2) not act upon any third-party inquiry or other submission in a published application, except for written submissions that are provided for in 37 CFR 1.99 and written submissions in applications in which the applicant has provided an expres

Re:Invent their own currency?

[Billly Gates]

What are the odds that JP will make their own? They mine their own and viola FREE money and their own printing press!

Full Retard

[Jayfar]

With the astounding ignorance of patents shown by the majority of posters here, not to mention lack of knowledge of the actual claims listed in the proposed patent, /. has officially gone full retard.

Ugggh!

[DaMattster]

I believe this is the end of civilization as we know it. Banks are not meant to be in the business of IP and patents. Patents were meant for true innovators. If this is an attempt to kill Bitcoin, it'll never work because Bitcoin is decentralized! Plus, this is clearly prior art.

No it doesn't!

[KNicolson]

1999 is the date of the earlier related patent. The filing date is above, clearly written as August 5, 2013, and of course the application number starting with "2013..." is another huge give-away.

I'm Not Convinced

[EricCordian2855]

It's not at all clear from the story that JP Morgan's patent copies Bitcoin. The patent says nothing about the transactions being stored to a Distributed P2P Network. Paying bills anonymously with zero transaction fees and competing with Western Union are hardly the areas in which Bitcoin distinguishes itself from other EFT systems.

Re:I'm Not Convinced

[xate]

It's not at all clear from the story that JP Morgan's patent copies Bitcoin. The patent says nothing about the transactions being stored to a Distributed P2P Network. Paying bills anonymously with zero transaction fees and competing with Western Union are hardly the areas in which Bitcoin distinguishes itself from other EFT systems.

And BitCoin is not anonymous. I don't think this is directed at BitCoin or more than slightly related. I think that the BitCoin-mania has distorted someones perception.

This is irrelevant. The are no Bitcoin patents.

[bstarrfield]

There are no BitCoin patents. BitCoin's authors have explicitly chosen to be anonymous. Satoshi isn't going to come out of hiding to claim a patent, and no one else would have the standing to do so.

You want to hide in the shadows (perhaps for good reasons, perhaps for bad), then accept that you're in the shadows and you cannot protect some of your legal rights. Suppose someone did want to patent BitCoin's modus operandi - slightly modified of course - what could Nakamoto do? He (she, they) could get the patent, but then would be called in front of governments across the globe. BitCoin would then cease to be the mysterious, mighty crypto currency and would become just another payment system with a few really cool embellishments.

Of course, I've always had the nagging suspicion that BitCoin's authors recognized that this would be a brilliant pyramid scheme. They had access to mining far earlier than most anyone else, so the "effort" in their mining work was much easier, requiring less costly capital investments. They're now able to take advantage of the BitCoin hype and cash out with tremendous benefits. Tremendous benefits that would be taxed if their home government knew who they were. Don't expect a BitCoin patent anytime soon.

hmmm Thought banks had to track money transfers

[NicolasEdwards]

I thought USA terrorism laws prevented banks from doing anon transactions. How are they going to work around that.

Bitcoin rah rah rah!

[vinehair]

Okay, we get it, everything is related to Bitcoin and we must hear about it daily. Including this patent which barely has anything to do with how Bitcoin operates on a technical or design level, other than whatever the submitter could pretend to find while glancing over the patent abstract.

I really wish the Slashdot love affair with Bitcoin would end, already.

Re:Invent their own currency?

[LynnwoodRooster]

Why bother with digital currencies like Bitcoin when you have the Fed at your beck and call?

Re:Invent their own currency?

[Billly Gates]

Why bother with digital currencies like Bitcoin when you have the Fed at your beck and call?

Easy Fed is a consortium of all the banks and a quasi government agency like Fanni Mae. So any extra cash printed is still owned by the treasury department even if you have a voice on a consortium of other banks.

BUT ... if you mine it yourself you own all of it :-) And now you have the other banks by the balls if your standard wins. You decide, control, and set whatever the hell interest rates on the whole damn world!

Actually that is pretty damn scary and as evil as the FED is at least one can't step on the toes of everyone as they have a say even if we don't

Re:This is irrelevant. The are no Bitcoin patents.

[gl4ss]

"Satoshi isn't going to come out of hiding to claim a patent, and no one else would have the standing to do so."

having invented it is irrelevant to being first to claim ;).

"Bitcoin killer"?

[rebelwarlock]

Besides Fox News's dumb ass, who said "bitcoin killer"? Why the hell would it be quoted if no one said it?

Also, the rest of the article is clearly bullshit, but I'm pretty sure the comments above this one have already covered all the other ways in which the writer has failed.

that's what they're *supposed* to protect

[Chirs]

In reality, in the software world, all too often the patents are protecting what people want to do, or the behaviour of the system.

electronic bank transfers way too complicated

[Chirs]

I have a no-frills online bank that will let me transfer funds for free to other bank accounts, but they have to be *my* accounts and I have to send in a form and a void check first and it takes a while to set up each account.

On the other hand, I can use a paper check at no charge. (They even send me new checks for free.)

This makes no sense. A check is simply a piece of paper with bank account information on it. Why can't I enter that information manually (or scan it electronically) and do a direct transfer into someone's account?

It can't be security, since there will be a direct record of the transaction. It would be no more risky than an existing inter-account transfer.

it's ironic

[Chirs]

I can use paper checks entirely for free, but if I want to transfer funds directly to someone else's account the bank wants a fairly substantial fee for the service even though it could be done entirely automatically with no person in the loop.

Makes zero sense...

not quite right

[Chirs]

Their main purpose is to provide profit for the shareholders.

One way of doing that is to extract as many fees as possible from retail banking customers while doing as little to earn the fees as possible.

I clued into this ages ago, so I use a no-fee online account for the vast majority of my personal banking.

Sounds like Mondex

[biodata]

I thought this was done in the 90's by NatWest but ended up being bought up and turned into loyalty card systems, rather than kept as cash that people could actually use to buy useful things.