People often inadvertently refer to “Bitcoin” when they actually mean blockchain, perhaps largely because the Bitcoin cryptocurrency was the first application of blockchain. But, blockchain is more than cryptocurrency. Cryptocurrency is a type of digital asset implemented using the blockchain technology. The blockchain technology allows cryptocurrencies to be stored and transferred on a distributed ledger using a peer-to-peer, open, public, and anonymous network. Thus, although blockchain technology was initially created to facilitate cryptocurrency transactions and is largely known for its applications in the financial services industry, any application that requires a registered ledger is a candidate for blockchain support. Industries other than financial services can benefit from adopting blockchain, including the creative industries which refers to economic activities concerning the generation and commercialization of knowledge and information.
The Ink Foundation entered the blockchain world to solve four problems facing the creative industry: (1) unclear ownership of intellectual property (IP), (2) inadequate data authenticity (which often leads to unfair distribution of proceeds), (3) the centralized governance of publishing, distribution and platform management (which can prevent quality content from reaching consumers), and (4) difficulty in converting work products to liquid assets such as cash.
So how can this technology help creative minds address the aforementioned problems? Last Fall, I attended the launch event of Ink Project to talk to its developers and find out. Ink is a decentralized solution that harnesses the combined power of Consortium Blockchain, Public Blockchain and Cross-chain Interoperability to address challenges with respect to ownership and rights to the resulting content.
Decentralization means that the control of any process or service, such as domain or content registration, does not to belong to a single person, organization or government. Rather, the process is distributed among all users to record and track ownership of content that cannot be erased or modified by third parties.
Cross-chain technology allows two people holding tokens (or any other asset) on two different blockchains to trade directly and instantly without the risk of one party pulling out of the trade before its completion.
So how does Ink use this technology?
Firstly, as Banu Naraghi, an attorney at Gerard Fox Law, explains: “When IP rights holders register their works to a blockchain, the rights holders can ultimately end up with concrete evidence of ownership, which is free from tampering, because once a work has been registered to a blockchain, that information cannot ever be lost or changed. So, third parties can use the blockchain to see the complete chain of ownership of a work, including any licenses and assignments.” Overall, the system addresses a fundamental challenge in content creation by allowing the owner and consumer to trail content ownership.
Secondly, the aforementioned blockchain designs each serve a distinct technical purpose. Ink strategically chose to use consortium blockchain to limit operations to country-specific regions. They refer to this concept as the “trusted Sovereign Consortium Blockchain for regional use cases”. Given that content creators are bound by their country’s unique legal frameworks, regulatory policies and even cultural norms, the design had to account for complications that might arise from operating in multiple jurisdictions by implementing this very concept.
But, if the technology is only operable within a given country, how can Ink fulfill its mission to “distribute creative work without boundaries”? This is where cross-chain technology comes in and acts like a bridge that allows information and content to flow freely between public blockchain (Qtum) and Sovereign Consortium Blockchain. For example, once you produce content that adheres to domestic regulations including copyright law, you can secure it on the local sovereign consortium blockchain. The content then passes into the proprietary Cross-chain Protocol to reach various public blockchains and can be traded through the blockchain globally.
By creating a decentralized registration system that allows one to claim ownership within seconds and reach its users around the globe through the cross-chain protocol, Ink is set to tackle the concerns of content providers and facilitate the flow of innovative ideas. It seems clear to me that, as part of the emerging decentralized web, blockchain has the potential to revolutionize our understanding of content creation, registry, and dissemination by using a decentralized database for IP.
Ekin Ober is an IPilogue Editor and a JD/MBA student at Osgoode Hall Law School and the Schulich School of Business.