Square Inc (NYSE:SQ), the financial technology company co-founded by Jack Dorsey, has launched an initiative to encourage open-sourced innovation-sharing in the cryptocurrency domain.
What Happened: The company launched COPA or Cryptocurrency Open Patent Alliance, which addresses the patent lockup concern, on Thursday.
The fintech company claimed that locking up foundational cryptocurrency technology via patents would negatively impact innovation and adoption of digital assets, as earlier reported by CoinDesk. In some cases, companies also file “pre-emptive patent” for potential ideas without an intent to follow through, just to keep competitors at bay.
COPA aims to address these bottlenecks to innovation by creating a shared library for members.
"We believe that cryptocurrency’s success depends on the community coming together to build and develop upon existing technologies to innovate, which is not possible when parties tie up foundational technology in patents and litigation," the Dorsey-led company said in statement.
Why It Matters: COPA will function as a separate entity from Square, a spokesperson for the payments company confirmed to CoinDesk.
The organization presents an opportunity for companies like Microsoft Corporation (NASDAQ:MSFT) and International Business Machines Corp. (NYSE:IBM), both of which have filed for cryptocurency-related patents in the past year, to be able to share technological innovations, alongside companies operating in the industry.
Dorsey has betted big on cryptocurrencies, including touting Bitcoin as the most viable currency for the internet. Square also reported a $750 million of revenue from the world's apex cryptocurrency in its latest quarter last month.
Price Movement: After a 2.18% decline during trading hours on Thursday, Square stock marginally gained 0.34% in the extended trading hours to close at $141.55.