The Winklevoss brothers, founders of the Gemini cryptocurrency exchange, have obtained six stablecoin-related technology patents, filings with the U.S. Patent and Trademark Office reveal.
Several of the patents, awarded between August 2019 and January 2020, describe a system which enables users to directly swap fiat currency for a digital equivalent. Such a system would require “trusted entities”, which are able to generate, exchange and destroy the stablecoin, as well as maintain a 1:1 ration between the currency collateral and the number of issued tokens.
The first patent not only explains how the Gemini exchange can act as a trusted entity, but how “other types of trusted entities (e.g., banks, trusts, etc.)” can be used to mint, administer and manage new tokens.
Another patent describes a way by which stablecoins could be used as collateral in financial transactions, conducted through smart contracts. A patent filed on April 23, 2018, suggests that a “stable value digital asset” can be used to pay dividends for securities “and other financial instruments tied to a blockchain”.
More and more companies have started to research and patent cryptocurrency technologies. Last week, tech giant IBM was awarded a patent for a “self-aware token”, which could “bolster trust and viability” of a token-based economy with its ability to track and record the events of offline transactions.
Earlier this year, Gemini became the first company in the industry to complete a SOC 2 Type 2 cybersecurity risk evaluation, which demonstrates the design and effectiveness of the cybersecurity risk management programs. In order to “demonstrate the highest level of security compliance in the industry”, Gemini has vowed to conduct the evaluation annually.