Fintech

Patent trolls are circling crypto. A Square lawyer wants to defend it.

Kirupa Pushparaj leads an industry group that's taken on controversial bitcoin figure Craig Wright.

​Square's Kirupa Pushparaj is defending the nascent cryptocurrency industry against patent trolls.

Square's Kirupa Pushparaj is defending the nascent cryptocurrency industry against patent trolls.

Image: Square, Executium/Unsplash

Square CEO Jack Dorsey's affinity for cryptocurrency is no secret: His Twitter bio reads just "#bitcoin," he's hired engineers to work on open-source crypto projects and Square's Cash App is making a mint on bitcoin trading.

But one of the most powerful figures working at Square to make cryptocurrency mainstream is a much lower-profile lawyer, Kirupa Pushparaj.

In his day job as deputy general counsel, he oversees Square's intellectual property portfolio and legal operations. He's also board chair of the Cryptocurrency Open Patent Alliance, an industry group Square formed in September. Coinbase, Kraken, Blockstack, SatoshiLabs and Okcoin are also members. It's an independent nonprofit with a board made up of six people from member companies and three from the crypto and open-source worlds.

There's more and more at stake every day. Square is worth nearly $100 billion, its value juiced in part by investors' hopes around its exposure to crypto. The company just reported that more than half of its quarterly revenue came from crypto trading. The next most valuable member, Coinbase, is worth almost $60 billion following its direct listing. And a growing economy of startups is similarly betting on cryptocurrency. Patent lawsuits and other intellectual property disputes threaten that momentum.

The companies in COPA have pledged to never proactively assert a patent in a case — a "first strike" — and to put all their patents together as a defensive shield against patent trolls.

The former move is to ensure that crypto companies don't sue each other over patents. And it effectively makes the technology protected by those patents free for anyone to use.

The latter pledge is designed to help smaller companies that don't have as many patents, letting them borrow the patents from this collective library to defend themselves against abusive patent claims.

"The best use of patents is not to even come to use them, but to avoid litigation in the first place," Pushparaj said.

Crypto enthusiasts also espouse decentralization, financial inclusion and opening up markets for all, and they're also generally supporters of open source, which undergirds most blockchain development. Those philosophies inform COPA, Pushparaj said.

Accordingly, the group's interests go beyond just patents. In April it filed a lawsuit against Craig Wright, a notorious figure in the crypto industry who has claimed to be Satoshi Nakamoto, the pseudonym of the inventor of Bitcoin. Many in the industry have questioned Wright's claims, and he hasn't provided proof.

Wright had sent cease-and-desist letters to companies and core developers for web hosting and using the original Bitcoin white paper written by Nakamoto. He has also attempted to copyright the white paper and Bitcoin code.

COPA argues that Wright isn't the author of the original Bitcoin paper and that Wright doesn't own the copyright to it. The group sees protecting anyone's ability to use the document as part of its mandate to protect the crypto industry.

Patents are a key issue for crypto because the industry is still at an early stage, and patent wars could hurt innovation among companies seeking to build new crypto products and technology, Pushparaj said.

Having patents locked up by a few entities could also stifle the industry and prevent mass adoption, which is what it really needs, he said, pointing to patent wars over 5G networks or cellular in previous tech generations as examples of legal battles that hurt development of innovation.

"The industry needs more adoption, so we don't want foundational technology locked up in patents in a way that only a select few have access to it," Pushparaj said. "We don't want to bring patent wars to tech that already has much farther to go in such an early stage."

Square deal

Pushparaj has a combination of technical and legal expertise that's been an asset in the complex world of tech IP law. He did his undergraduate engineering degree in India, then came to the U.S. in 2001 as a graduate student in computer science.

After starting out at Siemens and then Intel as an engineer, his interest in law drew him to enter law school while still working at Intel. After a stint at law firm Perkins Coie, he went to Amazon and worked in the unit that developed the Kindle.

At that point, a young company called Square poached him away. "I had heard about the company. The idea that you could use a mobile plug-in to reach the world of finance for just about anyone was fascinating to me," he said.

Pushparaj joined Square in 2013 when there were about five in-house attorneys and the company was growing quickly.

At Square, Pushparaj's team not only works on patents, but also is involved in product development. "Our team needs to be at the precursor part with engineering teams, helping them come up with ideas and brainstorming ideas, way earlier than at the product roadmaps," he said.

Intellectual property gets a bad rap for being used by patent trolls who don't bring products to market and just sue other companies, but IP can be used for innovation, Pushparaj said. "It's more about protecting what we do from a defensive perspective," he said. "Trying to protect our company from trolls and abusive litigation is where our primary role is on the IP side."

Square has been sued for patent infringement several times over the years. And it has more than 1,000 patents or patent applications, some of which are crypto-related and subject to COPA's pledges. Instead of paying off the trolls and settling, Square has fought the cases that it believes are invalid or too abstract, despite it costing much more than settling. That's because Square believes that's the only way to stop the problem.

Part of the problem comes from patent law in the 1990s and early 2000s, where such laws were written extremely broadly especially for financial technology, Pushparaj said. "One patent that was issued said, 'I'll look at the stock market and hedge my bets and see when I should buy stock from the market,'" he said. "That's so abstract an idea that it's something you can do in your head, and it's very fundamental to how you operate in the financial industry."

In the emerging world of crypto, patents are even more important, Pushparaj says. The worst thing that could happen is for crypto startups to be sued for patent infringement, Pushparaj says. "At this stage we want to make sure there's more innovation in cryptocurrency development."

Workplace

What the economic downturn means for pay packages

The war for talent rages on, but dynamics are shifting back to the employers.

Compensation packages could start to look different as companies reshuffle the balance of cash and equity.

Illustration: Nuthawut Somsuk/Getty Images

The market is turning. Tech stocks are slumping — which is bad news for employees — and even industry powerhouses are slowing hiring and laying people off. Tech talent is still in high demand, but compensation packages could start to look different as companies recruit.

“It’s a little bit like whiplash,” compensation consultant Ashish Raina said of the downturn. Raina, who mainly works with startups that have 200 to 800 employees, previously worked as the director of Talent at Index Ventures and head of Compensation and Talent Analytics at Box. “I do think there’s going to be an interesting reckoning in terms of pay increases going forward, how that pay is delivered.”

Keep Reading Show less
Allison Levitsky
Allison Levitsky is a reporter at Protocol covering workplace issues in tech. She previously covered big tech companies and the tech workforce for the Silicon Valley Business Journal. Allison grew up in the Bay Area and graduated from UC Berkeley.
Sponsored Content

Why the digital transformation of industries is creating a more sustainable future

Qualcomm’s chief sustainability officer Angela Baker on how companies can view going “digital” as a way not only toward growth, as laid out in a recent report, but also toward establishing and meeting environmental, social and governance goals.

Three letters dominate business practice at present: ESG, or environmental, social and governance goals. The number of mentions of the environment in financial earnings has doubled in the last five years, according to GlobalData: 600,000 companies mentioned the term in their annual or quarterly results last year.

But meeting those ESG goals can be a challenge — one that businesses can’t and shouldn’t take lightly. Ahead of an exclusive fireside chat at Davos, Angela Baker, chief sustainability officer at Qualcomm, sat down with Protocol to speak about how best to achieve those targets and how Qualcomm thinks about its own sustainability strategy, net zero commitment, other ESG targets and more.

Keep Reading Show less
Chris Stokel-Walker

Chris Stokel-Walker is a freelance technology and culture journalist and author of "YouTubers: How YouTube Shook Up TV and Created a New Generation of Stars." His work has been published in The New York Times, The Guardian and Wired.

Policy

How 'Zuck Bucks' saved the 2020 election — and fueled the Big Lie

The true story of how Mark Zuckerberg and Priscilla Chan’s $419 million donation became the 2020 election’s most enduring conspiracy theory.

Mark Zuckerberg is smack in the center of one of the 2020 election’s multitudinous conspiracies.

Illustration: Mike McQuade; Photos: Getty Images

If Mark Zuckerberg could have imagined the worst possible outcome of his decision to insert himself into the 2020 election, it might have looked something like the scene that unfolded inside Mar-a-Lago on a steamy evening in early April.

There in a gilded ballroom-turned-theater, MAGA world icons including Kellyanne Conway, Corey Lewandowski, Hope Hicks and former president Donald Trump himself were gathered for the premiere of “Rigged: The Zuckerberg Funded Plot to Defeat Donald Trump.”

Keep Reading Show less
Issie Lapowsky

Issie Lapowsky ( @issielapowsky) is Protocol's chief correspondent, covering the intersection of technology, politics, and national affairs. She also oversees Protocol's fellowship program. Previously, she was a senior writer at Wired, where she covered the 2016 election and the Facebook beat in its aftermath. Prior to that, Issie worked as a staff writer for Inc. magazine, writing about small business and entrepreneurship. She has also worked as an on-air contributor for CBS News and taught a graduate-level course at New York University's Center for Publishing on how tech giants have affected publishing.

Fintech

From frenzy to fear: Trading apps grapple with anxious investors

After riding the stock-trading wave last year, trading apps like Robinhood have disenchanted customers and jittery investors.

Retail stock trading is still an attractive business, as shown by the news that crypto exchange FTX is dipping its toes in the market by letting some U.S. customers trade stocks.

Photo: Lam Yik/Bloomberg via Getty Images

For a brief moment, last year’s GameStop craze made buying and selling stocks cool, even exciting, for a new generation of young investors. Now, that frenzy has turned to fear.

Robinhood CEO Vlad Tenev pointed to “a challenging macro environment” marked by rising prices and interest rates and a slumping market in a call with analysts explaining his company’s lackluster results. The downturn, he said, was something “most of our customers have never experienced in their lifetimes.”

Keep Reading Show less
Benjamin Pimentel

Benjamin Pimentel ( @benpimentel) covers crypto and fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at bpimentel@protocol.com or via Google Voice at (925) 307-9342.

Enterprise

Broadcom is reportedly in talks to acquire VMware

It hasn't been long since it left the ownership of Dell Technologies.

Photo: Yichuan Cao/NurPhoto via Getty Images

Broadcom is said to be in discussions with VMware to buy the cloud computing company for as much as $50 billion.

Keep Reading Show less
Jamie Condliffe

Jamie Condliffe ( @jme_c) is the executive editor at Protocol, based in London. Prior to joining Protocol in 2019, he worked on the business desk at The New York Times, where he edited the DealBook newsletter and wrote Bits, the weekly tech newsletter. He has previously worked at MIT Technology Review, Gizmodo, and New Scientist, and has held lectureships at the University of Oxford and Imperial College London. He also holds a doctorate in engineering from the University of Oxford.

Latest Stories
Bulletins