IP Load Balancing vs. Existing Blockchain IP Systems

What makes our approach different — and what legal considerations apply.

The Landscape: What Exists Today

Most blockchain-IP projects fall into a few categories:

1. On-Chain Registries

Examples: IPwe Registry, similar platforms

What they do:

• Patent ownership and transactions recorded on Ethereum/Hyperledger
• Smart contracts for licensing
• Searchable registry of IP assets

Limitation: Static ownership model. Once registered, the economic structure is fixed.

2. Marketplaces / Exchanges

Examples: IPExchange, IP-Maris

What they do:

• Tokenized or fractional IP interests
• On-chain licensing
• Trading of IP-backed rights

Limitation: Optimizes for liquidity and price discovery, not fairness or cooperative ownership.

3. Proof-of-Existence / Timestamping

Examples: Bernstein.io

What they do:

• Hash documents, anchor to Bitcoin or other chains
• Prove authorship and integrity
• Timestamped creation records

Limitation: Purely notarial — no economic mechanism, just proof.

4. Patent Pools & Smart Pools

Examples: IPwe Smart Pools

What they do:

• Bundle patents for licensing efficiency
• AI-assisted analytics
• Sometimes NFTs for patents

Limitation: Market access and analytics layer, not fairness-driven economics.

How IP Load Balancing Differs

The Five Key Differentiators

1. Fairness & Cooperative Prosperity (Not Just Liquidity)

Existing systems focus on:

• Better discovery and trading of IP rights
• Lowering transaction costs
• Enabling securitization

IP Load Balancing focuses on:

• Capped, recyclable returns (per-stake $10M cap)
• Dynamic rebucketing to keep per-stake outcomes in the same band
• Majority control for the platform/workers (60/20/20 split), not outside capital

That’s a different optimization target: equitable, non-feudal flows versus maximum monetization.

2. Dynamic Load-Balancing (Not Static Pools)

Existing blockchain IP systems:

• Treat each patent (or pool) as a relatively static asset
• Ownership and royalty flows wired once, rarely changed
• Some pooling, but no systematic rebucketing based on performance

IP Load Balancing:

• Groups patents into Patent Buckets
• Periodically reassigns patents across buckets at snapshot times
• Uses performance metrics to minimize variance in per-stake returns across buckets
• Allows the number of buckets to change

This “IP load balancing” is analogous to dynamically balancing traffic or storage, but applied to IP economics. That’s not present in existing systems.

3. Caps and Splitting (Not Unbounded Rent and Tokenization)

Tokenization projects typically:

• Fractionalize IP into tokens/NFTs
• Let the market determine returns, often unbounded
• “The more valuable the IP, the higher the token price, potentially forever”

IP Load Balancing:

• Caps cumulative payout per capital stake at a finite amount ($10M)
• Splits stakes when they become too valuable
• Retires stakes at the cap and reopens capacity at current fair value

This prevents perpetual rent-seeking and keeps entry open for new participants.

4. Integration with Macro-Economics (Three-Gear + Cost+20)

Existing platforms treat blockchain as:

• A registry
• A licensing automation tool
• An exchange mechanism

They don’t rewire the macro-economics of the platform.

IP Load Balancing:

• Embeds IP allocation inside a larger system with:
  • Three-gear currency differential (Credits/Marks/Joules)
  • Cost+20 margin and 83.3% retention
  • Democratic funding and recursive ownership

The IP mechanism is part of a complete economic constitution, not a single DApp.

5. Ledger as Fairness State Machine (Not Just Notarization)

Bernstein & similar: Use chain for timestamped proof.
IPWe et al.: Use chain for registry and transaction logs.

IP Load Balancing uses the ledger for:

• IP asset registration and attribution
• Stake ownership
• Bucket compositions at each snapshot
• Cap hits, splits, and reissuance

The ledger is the authoritative record of fairness operations, not just “proof of existence” or “who owns what.”

Prior Art Distinctions (For Patent Claims)

What Exists in Prior Art

1. Blockchain registries for IP (IPWe, various patents)
2. Blockchain-based IP marketplaces and patent pools
3. Generic tokenization of IP rights
4. Smart contract-based licensing

What IP Load Balancing Adds (Novel Elements)

The combination of:

1. 60/20/20 split with cooperative majority
2. Fixed 20% external slice split into global pool + dynamic buckets
3. Per-stake cumulative cap + splitting
4. Snapshot-based bucket rebalancing aimed at per-stake fairness
5. Optional three-gear currency integration
6. Ledger use for these specific mechanisms (not just registries or licensing)

Academically: You can argue that existing systems optimize for transparency and liquidity in IP markets. IP Load Balancing introduces a new class of fairness-driven, capped, dynamically rebalanced IP allocation mechanisms implemented on a ledger.

Legal Considerations for Patenting IP Load Balancing

Risk 1: Abstract Idea / Alice Risk

The concern: US courts are wary of patents that look like “do generic economic logic on a computer/on a blockchain.”

IP Load Balancing includes:

• An economic allocation scheme (splits, caps, buckets)
• Implemented in software and optionally on a ledger

Mitigation:

1. Emphasize specific technical structures and processes:

   • Explicit data structures for buckets, stakes, snapshots
   • Algorithms for rebalancing (e.g., minimizing variance of per-stake returns given constraints)
   • Concrete interactions with a distributed ledger (transaction formats, state transitions)

2. Tie to technical problems:

   • State explosion or inconsistency in multi-party IP accounting
   • Need for deterministic, auditable rebalancing across many participants

3. Avoid claiming “a method of allocating IP revenue” in purely conceptual terms — always ground in specific computational implementation.

Risk 2: Prior Art in Blockchain IP Management

The concern: Significant prior art around blockchain registries, marketplaces, patent pools, tokenization.

Risk: If claims are too broad (e.g., “using blockchain to manage IP pools”), they’ll be invalidated by existing art.

Mitigation:

Narrow claims around the combination of:

• 60/20/20 split with cooperative majority
• Fixed external slice split into global pool + dynamic buckets
• Per-stake cumulative cap + splitting
• Snapshot-based bucket rebalancing aimed at per-stake fairness
• Optional three-gear integration
• Ledger use for these specific mechanisms

Risk 3: Securities / Regulatory Overlap

The concern: If USPTO and courts view the system as issuing and trading profit-participation rights in IP, that could resemble securities (Howey test territory).

Current framing:

• Internal accounting (Credits/Marks/Joules)
• Capped returns
• No external tradability
• “This is business, not finance”

Residual risk: If people treat A/C stakes like investment products and trade them off-platform, regulators may argue they are securities regardless of intent.

This doesn’t stop you from getting a patent — it affects how you can monetize it.

Mitigation:

1. In the patent spec: Describe units as non-transferable outside the platform, tied to usage and cooperative membership. Avoid language that sounds like “investment tokens” or “public trading.”

2. In implementation: Lock A/C stakes to KYC’d participants under terms of service that emphasize use and participation, not speculation.

Risk 4: Contract / Antitrust Concerns

The concern: Because IP Load Balancing encodes caps, fixed splits, and bucket rebalancing rules, someone could argue this is price-fixing or coordinated control of IP licensing.

Mitigation:

Given the cooperative context and:

• Participation is voluntary
• Outside licensing under different rules remains possible

The antitrust risk seems low, but counsel should ensure contracts:

• Don’t force creators or sponsors into exclusive arrangements that look like market allocation
• Allow exit and alternative licensing paths (which you already do in IP tiers)

Risk 5: Territorial and Subject-Matter Variations

The concern: Different jurisdictions differ on software/business method patentability and treatment of blockchain-related claims.

Risk: Some national offices could refuse on abstract-idea grounds even if the US allows.

Mitigation:

• Focus first on US filing with strong technical detail
• Later, selectively file in jurisdictions friendlier to software/business methods if strategically valuable

Summary: Why This Is Patentable

The combination is novel and non-obvious. Counsel should draft claims emphasizing:

1. The specific technical implementation
2. The fairness-seeking objective function
3. The integration with cooperative economic structures
4. The ledger’s role beyond mere registration

Further Reading

• IP Load Balancing on the Ledger
• IP Load Balancing Academic Paper
• Patent Claims Scaffold (internal)
• Patent Buckets FAQ

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