IP Load Balancing on a Cooperative Ledger

A Dynamic Allocation Mechanism for Universal Sustained Prosperity

Jonathan R. Jones
Liana Banyan Corporation
February 17, 2026

Abstract

We present IP Load Balancing, a system for managing economic rights in intellectual property portfolios within a cooperative platform. The mechanism features: (1) majority platform control via a 60/20/20 top-level split; (2) capped, recyclable returns for external capital; (3) dynamic bucket rebalancing to maintain equitable per-stake outcomes; and (4) immutable ledger recording for transparency and auditability.

The model applies to an existing portfolio of 1,243 documented innovations and coexists with a three-tier IP control framework used by all creators. We argue that IP Load Balancing represents the economic complement to combinatorial innovation frameworks, implementing “universal sustained prosperity” principles in intellectual property management.

Keywords: Intellectual property, cooperative economics, blockchain, patent pooling, load balancing, sustained prosperity

1. Introduction

1.1 Related Work

Existing blockchain-enabled IP systems fall into three categories:

Blockchain IP Registries and Timestamping (e.g., Bernstein, Po.et)

• Focus: Provenance and proof-of-existence
• Mechanism: Hash anchoring, timestamping
• Economics: None — purely administrative

Blockchain IP Management and Smart Pools (e.g., IPwe, Ocean Protocol)

• Focus: Search efficiency, licensing automation
• Mechanism: Static pools, fixed shares, smart contracts
• Economics: Traditional licensing with blockchain settlement

Tokenized IP and Exchanges (e.g., IPStock, various NFT platforms)

• Focus: Fractional ownership, liquidity
• Mechanism: Token issuance, secondary markets
• Economics: Unbounded returns, market price discovery

1.2 The Gap

None of these systems:

1. Cap per-stake returns — All allow unbounded extraction by early or lucky holders
2. Rebalance exposure across IP assets — Path-dependent luck determines outcomes
3. Integrate with cooperative macro-economics — No connection to bounded margins, internal currencies, or community governance

The result: blockchain IP systems optimize for liquidity and efficiency, not fairness or sustainability.

1.3 Our Contribution

We define IP Load Balancing as:

A capped, fairness-driven IP allocation mechanism implemented via fixed cooperative splits (60/20/20), global and bucketed pools, snapshot-based rebalancing, and on-ledger recording of state transitions.

We argue this represents a new subclass of blockchain-enabled IP systems whose optimization target is fair, sustainable allocation rather than liquidity alone.

Key innovations:

• Per-stake caps ($10M) with capacity recycling
• Dynamic bucket rebalancing to reduce path-dependent luck
• Integration with three-gear currency and Cost+20% margin economics
• Cooperative governance with majority platform control

2. Problem Statement

2.1 Traditional IP Regimes

Traditional intellectual property regimes treat patents and other IP assets as private moats and perpetual royalty streams. This leads to:

• Under-utilization: IP is hoarded rather than deployed
• Rent-seeking: Early or lucky patent holders extract disproportionate value
• Unequal access: Barriers to entry for new creators and innovators

Existing IP pooling and securitization models improve liquidity but preserve these underlying incentives. They treat IP as a financial asset class without addressing the cooperative potential of shared innovation infrastructure.

1.2 Motivation

Liana Banyan’s platform is built around three economic laws for Sustained Universal Prosperity, which require:

1. Cooperative ownership — majority control by workers and the community
2. Hard constraints on excess extraction — “enough is enough” codified in the system
3. Infrastructure supporting many small entrepreneurs — not a few large incumbents

These principles, articulated in prior work on economic sustainability [1], demand IP mechanisms that:

• Incentivize being built upon, not fenced off
• Reward contributors generously but not infinitely
• Keep entry open for new participants indefinitely

1.3 Contribution

We present IP Load Balancing on the Ledger, a system that:

1. Integrates capped, recyclable capital returns with dynamic bucket rebalancing
2. Runs atop an IP ledger that already encodes attribution and combinatorial innovation [2]
3. Implements the Three-Tier IP Control Framework for creator choice
4. Provides full transparency through immutable ledger records

This work extends the Exponential Innovation Engine framework [2] from innovation generation to innovation economics — one handles how innovations are created and attributed; the other governs how value from those innovations is distributed over time.

2. Theoretical Foundation

2.1 The Considered Approach and Margin Economics

The Considered Approach to Sustained Universal Economic Prosperity [1] centers on a margin rule: every transaction is priced at Cost+20%. If C is the cost of delivering a product or service, the platform price is P = 1.2C. The platform’s margin is P − C = 0.2C, which as a fraction of price is (0.2C)/(1.2C) = 1/6 ≈ 16.7%; the remaining five-sixths (≈83.3%) stay with the creator or worker.

This bounded margin is combined with:

• A Tab System for graduated, success-based deferred value settlement, where providers receive Cost+20% cash flow immediately and accumulate additional earned value as Marks.
• Commitment-triggered democratic funding, which opens funding windows when workers commit to positions, allowing small backers to participate at the same terms as larger investors.
• Recursive fractional ownership via medallion cascades, which conserve total value while distributing ownership across increasing numbers of smaller holders.

Together, these mechanisms create a platform that is always cash-flow positive while structurally favoring broad participation and long-term stability over extractive returns.

2.2 Three-Gear Currency Differential: Credits, Marks, and Joules

Global platforms must reconcile participants from radically different currency zones. Traditional options—fixed exchange rates, floating rates, or dollarization—either create arbitrage, uncertainty, or structural privilege for strong-currency users. Liana Banyan addresses this with a three-gear internal currency differential: Credits, Marks, and Joules.

Mathematically, this internal three-gear system maintains solvency under all participant compositions by absorbing currency differentials into Marks and Joules while keeping Credits at a fixed internal par. Behaviorally, it leverages mental accounting and loss-aversion framing to make cross-currency participation feel fair without subsidies.

2.3 How IP Load Balancing Plugs Into the Considered Approach

The Sustained Universal Economic Prosperity model defines the macro-economics of Liana Banyan:

• Three-gear currency differential for cross-border fairness
• Cost+20% margin, positive cash-flow proof, and graduated success-based contribution
• Commitment-triggered democratic funding, recursive ownership, distributed manufacturing

IP Load Balancing on the Ledger becomes the micro-allocation layer for intellectual property economics inside that macro system:

• The 60/20/20 split and A/C pools are one domain-specific application of the general “margin economics” and “no feudalism” principles
• Patent Buckets + caps + splitting are a specialized mechanism design for one asset class (IP) that respects:
  • The three-gear currency system
  • The Cost+20% margin
  • The recursive ownership instincts (medallions → buckets are a similar “spread, don’t concentrate” move)

In the combined framework:

• The eight innovations from the Considered Approach paper form the platform-level toolkit
• IP Load Balancing is a ninth, domain-specific innovation that governs how value created by those tools (especially combinatorial IP) is shared over time

Nothing in the Considered Approach conflicts with IP Load Balancing; it provides the theoretical spine.

2.4 Universal Sustained Prosperity as Design Target

Prior work [1] establishes that sustainable prosperity requires economic systems where:

• Prosperity is defined as “enough for everyone, sustainably” — not unbounded accumulation
• Rules encode limits — surplus is recycled rather than concentrated
• Infrastructure serves the many — small-scale enterprise is viable

This framework draws on cooperative finance literature, particularly the principles of limited return on capital and patronage-based governance [3]. The challenge is applying these principles to intellectual property, where traditional regimes assume unlimited extraction rights.

2.2 Exponential Innovation and Combinatorial IP

The Exponential Innovation Engine [2] demonstrates that:

• Innovations function as composable frameworks rather than isolated endpoints
• Combinatorial synthesis generates exponential returns (empirically: 13 innovations from 37 frameworks in 4 hours)
• Attribution chains track how innovations build on prior work

If innovation is inherently combinatorial and cumulative, IP economics must incentivize being built upon rather than being fenced off. The value of any single innovation derives partly from the ecosystem that enables its application.

2.3 Why Load Balancing Is Needed

Without load balancing:

• Early winners accumulate outsized claims on future combinatorial value
• Slow-maturing but important IP is under-rewarded
• Capital concentrates around “hot” patents while foundational work starves

IP Load Balancing addresses this by:

1. Pooling returns across groups of patents (buckets)
2. Dynamically rebalancing bucket membership based on performance
3. Capping per-stake returns to prevent permanent rent extraction
4. Recording all operations immutably for auditability

3. System Overview: 60/20/20 and the Ledger

3.1 Top-Level Allocation

For the existing patent portfolio P = {P₁, …, Pₘ}, each licensing event with revenue R is divided:

The Founder’s 20% position is structurally identical to what any creator can choose under the Three-Tier IP Control Framework — it is “just like everybody else,” demonstrating that the system treats all participants fairly.

3.2 External IP Pool: Two Mechanisms

The 20% external slice is further divided:

Both mechanisms are governed by per-stake caps and are recorded on the IP Ledger.

3.3 The IP Ledger

The IP Ledger is a test-net-by-design blockchain that serves as the authoritative record of:

• IP asset identifiers and attribution chains
• Tier selections (A/B/C) for each asset
• Stake ownership for sponsor and bucket positions
• Snapshot definitions and bucket partitions
• All payouts, cap events, and split operations

The ledger provides immutability without requiring “trustless” operation — governance remains with the cooperative, but the audit trail is permanent.

4. Mechanism A: Global Sponsor Pool

4.1 Definition

Mechanism A provides diversified exposure to the entire existing portfolio:

• Sponsors purchase units in a Global Sponsor Pool representing 10% of licensing revenues from all patents in P
• The pool has fixed capacity: once fully subscribed, no new units are issued against the existing portfolio
• New sponsors must purchase from existing holders or participate in future generations

4.2 Distribution Function

Let S be the set of sponsor units, |S| = N. On a license event for patent Pⱼ with revenue Rⱼ:

$$A_j = 0.10 \times R_j$$

This amount is distributed pro rata:

$$\text{payout}(s) = \frac{A_j}{N} \quad \text{for each } s \in S$$

4.3 Characteristics

The Global Sponsor Pool behaves like an index fund:

• Every existing patent contributes to the same pool
• Unit count is fixed, so early sponsors share in all subsequent activity
• Per-stake caps apply (see Section 6)

5. Mechanism C: Dynamic Patent Buckets

5.1 Participants and Instruments

Two instruments feed Mechanism C:

Both are forms of capital underwriting specific patents. For economic distributions, they are aggregated into a single cap table per bucket.

5.2 Bucket Formation and Rebalancing

At snapshot time t, patents are partitioned into k(t) buckets:

$$\mathcal{P} = \bigsqcup_{i=1}^{k(t)} B_i^{(t)}$$

Each bucket Bᵢ⁽ᵗ⁾ has:

• A set of assigned patents
• A cap table of participants (Credits + Marks)

Between snapshots, licensing revenue for patent Pⱼ in bucket Bᵢ⁽ᵗ⁾ flows to that bucket’s pool:

$$C_i^{(t)} = 0.10 \sum_{P_j \in B_i^{(t)}} R_{ij}^{(t)}$$

Distributed pro rata to bucket stakeholders.

5.3 Rebalancing at Snapshots

At each snapshot:

1. Measure performance: Compute per-stake returns for each bucket
2. Recompute partition: Choose new bucket assignments to minimize variance of per-stake returns
3. Update cap tables: Map participants to new bucket structure

The number of buckets k(t) is not fixed — it may increase or decrease based on portfolio composition and performance distribution.

Objective: Keep one unit of stake in any bucket roughly comparable in expected return to one unit in any other bucket, over time.

5.4 Numeric Example: Three Patents, Two Snapshots

Initial state (t₀):

• Patents: P₁, P₂, P₃
• Single bucket: B₁ = {P₁, P₂, P₃}
• Each patent has 100 stake units

Period 1:

• P₁ generates $100,000 in licenses
• P₂ generates $10,000
• P₃ generates $5,000
• Total C pool: $11,500 (10% of $115,000)
• Per-stake payout: $38.33

Snapshot t₁ analysis:

• P₁ alone accounts for 87% of revenue
• Without rebalancing, P₁ backers will dominate future returns

New partition at t₁:

• B₁′ = {P₁} (the fast patent)
• B₂′ = {P₂, P₃} (slower patents)
• Stake weights adjusted so per-stake expected returns align

Result: Early backers of P₂ and P₃ aren’t permanently disadvantaged; P₁ backers still benefit from strong performance, but some effect is distributed across buckets.

5.5 Snapshot Timing and Governance

Snapshot frequency is a design lever:

The platform begins with annual snapshots and may adjust based on measured bucket behavior. All snapshot decisions are recorded on the ledger with full reasoning.

6. Per-Stake Caps and Splitting

6.1 Per-Stake Cap

Each external capital stake s (in A or C) has:

• Cumulative payout P(s)
• Cap Cₘₐₓ = $10,000,000

When P(s) ≥ Cₘₐₓ:

• Stake s is retired from further distributions
• Economic capacity is reopened for new stakes

This implements “enough is enough” from the prosperity framework: no single stake can extract unbounded value.

6.2 Splitting Mechanism

When a stake’s estimated value exceeds a multiple of its par value:

1. The stake is split into multiple child stakes
2. Each child has proportionally reduced claims
3. Cumulative payout P(s) is divided equally among children

Example:

• Original stake: $1,000 purchase price
• Current value estimate: $20,000
• Split: 20 child stakes at $1,000 each
• Original holder owns all children initially
• Each child tracks toward the $10M cap independently

This keeps ticket sizes accessible without increasing total claims on the pool.

6.3 Labor vs. Capital

Critical distinction: Per-stake caps apply only to capital positions:

• Global Sponsor units
• Cash-based bucket stakes (Marks)

They do not cap labor:

• Work contributions tracked as Joules
• Cooperative wages and patronage
• Governance rights

This preserves cooperative principles: capital is welcome and rewarded, but its returns are limited and recyclable. Labor and participation continue generating value indefinitely.

7. Integration with the IP Ledger

7.1 Ledger Records

The IP Ledger stores:

7.2 Immutability and Auditability

The ledger provides:

1. Immutable history — past records cannot be modified
2. Transparent governance — all decisions are visible
3. Verifiable fairness — anyone can audit re-bucketing logic
4. Research dataset — enables empirical study of cooperative IP economics

7.3 Technical Architecture

The ledger is implemented as a permissioned blockchain:

• Not a public chain (no speculation, no token trading)
• Cooperative-controlled governance
• Designed for audit efficiency, not high-frequency operation
• Integrated with platform economics (Supabase, payout systems)

8. Application Beyond Patents

8.1 Phased Extension

IP Load Balancing can extend to other IP classes where:

• Licensing flows are clear and measurable
• Cooperative framing is strong
• Members want pooled exposure

Phase 1 (current): Utility patents in the existing portfolio

Phase 2: Other revenue-bearing IP classes

• Music licensing pools
• Educational content
• Software libraries

Phase 3: Selective extension

• Only where economics justify the machinery
• Everything else remains governance-only on the ledger

8.2 Class-Specific Parameters

Different IP classes may have:

• Different external slice sizes (not always 20%)
• Different bucket structures (or no buckets)
• Different cap levels
• Different snapshot frequencies

The framework is parameterized, not one-size-fits-all.

9. Discussion: Fairness, Incentives, and Innovation

9.1 Alignment with Cooperative Principles

IP Load Balancing implements:

9.2 Support for Combinatorial Innovation

By preventing IP hoarding and rent extraction:

• Creators are incentivized to build on existing work
• Parent frameworks benefit from being used
• No single innovation can dominate indefinitely
• The ecosystem grows faster than any monopoly

9.3 Contribution to Universal Sustained Prosperity

IP Load Balancing contributes to prosperity goals by:

• Flattening extreme outliers (caps)
• Keeping entry open (recycling)
• Incentivizing building rather than hoarding (bucket rebalancing)
• Making rules visible and enforceable (ledger)

10. Conclusion and Future Work

10.1 Summary

We have presented IP Load Balancing as the economic complement to combinatorial innovation frameworks:

• 60/20/20 split maintains cooperative control
• Global Sponsor Pool provides diversified exposure
• Patent Buckets enable concentrated but fair participation
• Per-stake caps and splitting prevent permanent rent extraction
• Ledger integration ensures transparency and auditability

The system implements “universal sustained prosperity” principles in intellectual property management, demonstrating that cooperative economics and innovation incentives can coexist.

10.2 Future Research

• Empirical tests of bucket fairness across snapshot intervals
• Optimal snapshot frequencies for different IP classes
• Behavioral responses of sponsors and creators to cap and rebalancing rules
• Regulatory positioning of capped, cooperative IP stakes
• Extension to non-patent IP classes and international frameworks

References

[1] Jones, J.R. (2026). “A Considered Approach to Universal Sustained Economic Prosperity.” Liana Banyan Corporation Working Papers.

[2] Jones, J.R. (2026). “Exponential Innovation Through Combinatorial Framework Synthesis.” Liana Banyan Corporation Working Papers.

[3] Hansmann, H. (1996). The Ownership of Enterprise. Harvard University Press.

[4] Lerner, J. & Tirole, J. (2004). “Efficient Patent Pools.” American Economic Review, 94(3), 691-711.

[5] Lemley, M.A. (2008). “The Patent Crisis and How the Courts Can Solve It.” University of Chicago Press.

[6] Bernstein Technologies. “Blockchain-based IP Registration.” https://www.bernstein.io/

[7] IPwe Inc. “AI-Powered Patent Market Platform.” https://ipwe.com/

[8] Ocean Protocol Foundation. “A Decentralized Data Exchange Protocol.” Ocean Protocol Whitepaper, 2019.

[9] Rosenblatt, B. & Trippe, B. (2019). “Blockchain for Creative Industries.” Copyright Clearance Center Report.

[10] De Filippi, P. & Wright, A. (2018). Blockchain and the Law: The Rule of Code. Harvard University Press.

Appendix A: Three-Tier IP Control Framework

All creators, including the founder, choose their tier for each IP asset. The choice is recorded on the ledger and governs all future transactions involving that asset.

Appendix B: Visual Summary

┌─────────────────────────────────────────────────────────┐
│                    LICENSE REVENUE: $R                   │
└─────────────────────────────────────────────────────────┘
                           │
          ┌────────────────┼────────────────┐
          │                │                │
          ▼                ▼                ▼
     ┌─────────┐      ┌─────────┐      ┌─────────┐
     │ 60%     │      │ 20%     │      │ 20%     │
     │PLATFORM │      │FOUNDER  │      │EXTERNAL │
     │(Coop)   │      │(Creator)│      │IP POOL  │
     └─────────┘      └─────────┘      └────┬────┘
                                            │
                              ┌─────────────┼─────────────┐
                              │                           │
                              ▼                           ▼
                         ┌─────────┐                 ┌─────────┐
                         │ 10%     │                 │ 10%     │
                         │ GLOBAL  │                 │ PATENT  │
                         │ SPONSOR │                 │ BUCKETS │
                         │ POOL    │                 │         │
                         └────┬────┘                 └────┬────┘
                              │                           │
                              ▼                           ▼
                         ┌─────────┐                 ┌─────────┐
                         │Pro-rata │                 │Pro-rata │
                         │to units │                 │to bucket│
                         │         │                 │stakes   │
                         └────┬────┘                 └────┬────┘
                              │                           │
                              └───────────┬───────────────┘
                                          │
                                          ▼
                                   ┌────────────┐
                                   │ $10M CAP   │
                                   │ PER STAKE  │
                                   │ (recycles) │
                                   └────────────┘

Appendix C: Credits, Marks, and Joules in IP Load Balancing

C.1 Unit of Account

All IP Load Balancing math is conducted in Credits as the internal unit of account:

• Global Sponsor units and Patent Bucket stakes are denominated in Credits
• “1 sponsor unit entitles you to X% of the 10% A slice, measured in Credits”
• “1 bucket unit entitles you to Y% of that bucket’s 10% C slice, measured in Credits”

C.2 Funding Stakes: How People Buy In

When someone acquires an A or C stake, they buy exposure in Credits but pay from their local currency:

1. Determine purchasing power ratio P(i) vs platform baseline (three-gear logic)
2. Choose stake size C Credits of exposure (e.g., 1,000 Credits of bucket exposure)
3. Apply three-gear conversion:

Result:

• Everyone buys the same stake in Credit terms
• Weak-currency participants don’t get subsidized; their gap is tracked as Marks (effort-debt they can clear by participation)
• Strong-currency participants don’t get penalized; their surplus is stored as Joules at acquisition time

C.3 Distributions: Paying Out A and C

When IP Load Balancing computes a payout:

A Pool:

1. Compute the 10% A slice for each license in Credits
2. Divide by sponsor units, pay out in Credits

C Buckets:

1. Compute the 10% C slice per bucket in Credits
2. Divide by bucket units, pay out in Credits

Then three-gear kicks in only when someone wants to move between Credits and external currency:

• Credits earned can be:
  • Spent directly on the platform
  • Used to buy more A/C stakes
  • Converted (if allowed) into Joules/Marks under existing rules

C.4 Governance and Reporting

Ledger entries for IP Load Balancing record:

• Amounts in Credits
• Derived Marks/Joules created when participants buy stakes from different currency zones
• Clearance (Mark repayment) and Joule redemption events as part of normal platform economics

This keeps IP economics and macro-economics consistent.

Appendix D: Comparison with Traditional VC Funding

In short: VC is built on uncapped, winner-take-most power laws; Liana Banyan is built on capped, recyclable, cooperatively governed flows where both capital and creators are constrained by “enough” and encouraged to keep the infrastructure open.

Appendix E: Combinatorial IP Synthesis Examples

Example A: Funding Mechanism for Ghost-to-Physical Products

Parents:

• Innovation 3: Commitment-Triggered Democratic Funding
• Innovation 4: Recursive Medallion Cascade
• Innovation 7: Ghost Items to Physical Products

Steps:

1. Select frameworks: Funding via worker commitment, recursive ownership via medallions, demand-validated ghost-to-physical manufacturing

2. Context shift: Apply to medical devices in low-resource settings

3. Mutation: When a ghost medical device crosses demand thresholds (usage, retention), a commitment-triggered funding window opens. Backers receive medallions that cascade ownership to local clinics and early users once physical production begins.

4. Novelty check: Ensure no existing framework covers “demand-validated, commitment-triggered, medallion-cascading medical devices”

5. Claim: “A system where virtual medical device items, once demand-validated, trigger democratic funding windows, with recursive ownership cascading to early adopters upon physical manufacture.”

Example B: Graph-Aware IP Load Balancing

Parents:

• Considered Approach: Three-gear currency / Cost+20 Tab system
• Exponential Innovation Engine: Automatic attribution across frameworks
• IP Load Balancing: Capped and bucketed IP revenue allocation

Steps:

1. Select frameworks: Three-gear currency, framework attribution graph, bucketed capped revenue distribution

2. Context shift: Apply to attribution-weighted revenue sharing: parent frameworks get a share of bucket flows proportional to their contribution to child frameworks

3. Mutation: Whenever a child framework is licensed, a small fraction of its bucket portion is allocated to a “parent bucket,” distributing value across the attribution graph until parent stakes hit their caps

4. Novelty check: Verify no existing system uses a capped, graph-aware bucket model for recursive IP revenue

5. Claim: “A graph-aware IP load-balancing mechanism where combinatorial parentage informs how capped bucket revenues are routed across framework ancestors.”

Appendix F: How 83.3% Revenue Retention Works

From the Considered Approach:

• Platform price P = 1.2C, where C = cost (including creator’s pay)
• Creator receives C out of P
• Fraction to creator: C / (1.2C) = 5/6 ≈ 83.3%

For every 120 Credits a customer pays:

• ~100 Credits go to the creator (their cost/pay)
• ~20 Credits go to the platform (margin)

This 83.3% retention is the backbone for both everyday commerce and IP Load Balancing flows. License revenues and stake payouts operate within the same Cost+20 framework, ensuring creators keep ~83.3% of direct revenue while the platform’s ~16.7% share funds infrastructure, redundancy, and the sponsor/bucket payouts.

For questions or feedback, contact: Support@LianaBanyan.org