Bitcoin firm Blockstream files for defensive sidechain patent

The United States Patent and Trademark Office (USTPO) has published a patent application for a sidechain filed by bitcoin startup Blockstream.

The application, filed on May 9 and published earlier this week, outlines a "system and method for transferring assets from a parent chain to a sidechain," and names Blockstream CEO Adam Back and Blockstream CTO Greg Maxwell as inventors of sidechains. Sidechains are envisioned as a way to allow digital assets to move from one blockchain to another, opening the door to new types of applications and experiments using blockchain technology.

It is reported that Blockstream has applied for a defensive patent, which means that users and Bitcoin technology developers can freely use Blockstream's inventions without worrying about patent lawsuits. The patent application outlines how assets can be exchanged between the main chain and a side chain connected to it, as explained below:

“A simplified payment verification (SPV) proof associated with the parent chain asset may be generated. The SPV proof may include threshold work. The SPV proof associated with the parent chain may be verified, and a side chain asset corresponding to the parent chain asset may be generated. If no reorganization proof is detected, the side chain asset may be released.”

Last summer, Blockstream released the open source code for its first sidechain, and later launched a side project called Liquid for bitcoin exchanges.

In February of this year, Blockstream received $55 million in Series A funding, and in July it acquired Bitcoin wallet startup GreenAddress to promote the development of its sidechain.