Mastercard Wins Blockchain Patent, Hiring Blockchain Specialists

Multiple transaction formats

The latest patent is dated 9 October. It is titled “Method and system for partitioned blockchains and enhanced privacy for permissioned blockchains”.

The patent describes the operation of a blockchain capable of “storing multiple transaction formats”. It says that this is necessary because blockchains demand that all transactions be of a similar format and even size, which limits utility.

It wants to achieve this by allowing blocks to receive data from “a plurality of subnets”. The hash code stamped on a finished block would cover all of the transactions.

This patent suggests that a Mastercard is working on a blockchain. The Irish Times reported in late September that the company’s research and development unit in Dublin had begun posting wanted ads for blockchain specialists.

Patent war

The company’s first blockchain patent was approved in November 2017. This was for a blockchain payment system called “method and system for instantaneous payment using recorded guarantees”, in which transaction messages would “[originate] from an acquiring financial institution and [be] formatted based on one or more standards…”

And in July 2018, Mastercard came up with the idea of sending cryptocurrency though a system designed for fiat money. The reasoning being that the latter can be much faster, and allows people to “evaluate the likelihood of fraud”. It would work by creating “a plurality of account profiles, each profile including a fiat currency amount, blockchain currency amount, account identifier, and address.”

One of the key characteristics of Bitcoin is that the technology is open source. However, since the financial establishment became interested, patenting inventions has become a trend.

Some examples: investment bank JPMorgan filed a vaguely-worded patent for an inter-bank blockchain-based payment system, financial corporation American Express filed to own a “blockchain-based proof-of-payment” that would include risk analysis, and investment bank Wells Fargo wants to own the idea of a bank-run system that creates crypto-tokens to represent monetary value, personal information, and media. This list is by no means exhaustive; according to Fortune, patents and applications for patents for such things has been predicted to reach 1,245 by the end of 2018.