Daniel Broaddus, Ph.D.

Non-fungible tokens, or “NFTs,” have captured headlines, offering the perfect mix of poorly understood technology and incredible sale prices. The first patent NFT auction by True Return Systems and the newly announced patent NFT exchange under development by IPwe and IBM could not be better timed to take advantage of the buzz. With all of the hype, companies understandably wonder whether they need to “tokenize” their patent portfolios to NFTs in this first wave simply to get ahead of the inevitable transition. For most companies, prudence counsels stepping back and letting the technologies and the markets mature. First, blockchain technology, as it currently exists, only creates clarity of ownership though harsh outcomes. Second, creating highly liquid patent license markets may interfere with the existing patent strategies of many patent owners.