- If Malikie wins, it could demand six years of back royalties, potentially bankrupting defendants and threatening other miners.
- Lawyers question patent validity, noting potential expiration issues and Bitcoin’s open-source implementation possibly avoiding infringement claims.
Malikie Innovations filed lawsuits against Bitcoin mining companies Marathon Digital and Core Scientific. The legal action claims these firms use Elliptic Curve Cryptography (ECC) covered by patents Malikie acquired from BlackBerry in 2023. Malikie obtained 32,000 patents from the former mobile device manufacturer.
Court documents state Bitcoin’s designers later adopted cryptographic methods Malikie asserts it now owns. The lawsuits target mining operations specifically. Aaron Brogan of Brogan Law noted individual Bitcoin users likely face minimal risk.
“Pursuing individuals is trickier because they are often ‘judgment-proof,’ which is lawyer jargon for broke.“
He explained legal action against individuals proves difficult since many lack funds to pay penalties. Mining companies, however, represent viable targets due to their financial resources.
“these entities will always tend to attract lawsuits because they have money, and the patent bar can try to take it from them.“
If Malikie wins, it could seek royalty payments covering up to six years of past usage. Brogan indicated such awards might reach sums large enough to force defendants into bankruptcy. A victory could also enable Malikie to pursue other U.S. miners using the same precedent. Brogan suggested this scenario might weaken Bitcoin’s network security.
Legal experts question Malikie’s strategy. Michael Bacina, a crypto lawyer, characterized the action as typical “patent trolling” – aiming for settlements rather than courtroom resolutions.
“So-called ‘patent-trolls’ typically do not intend to have claims tested in court, but rather seek to extract a settlement,” he noted.
Niko Demchuk of AMLBot cast doubt on the claims’ strength, noting potential issues like expired patents or Bitcoin’s implementation differing from patented methods. Bacina added that miners using open-source software might not infringe at all.
“Malikie’s claim appears not so strong if the asserted patents are expired or cover techniques that predate Bitcoin’s ECC implementation. Even if some patents remain active, their scope is likely limited to specific implementation details, not the core ECC algorithms used in Bitcoin,“ Demchuk said. Still, nothing is certain, he added
This follows historical attempts to assert control over Bitcoin’s foundational technology. Craig Wright previously filed 114 blockchain patents and unsuccessfully claimed to be Bitcoin’s creator.
Bitcoin (BTC) is trading at $105,278 USD, down slightly by −0.17% for the day. Despite this marginal decline, BTC is up +11.69% over the past month and has posted a +12.84% year-to-date gain, reinforcing its broader bullish structure. Over the past year, Bitcoin has climbed an impressive +53.10%, demonstrating continued strength even amidst global macroeconomic fluctuations.
Technically, Bitcoin has broken out of its previous rising channel and is now consolidating near the $105,000 zone, forming what analysts describe as a bearish flag pattern. A breakdown below $103,000 could signal a correction toward the key psychological support at $100,000. Conversely, if BTC breaks above $107,000, momentum could quickly return, opening the door to a retest of the all-time high at $112,000.
Fundamentally, Bitcoin remains strong. South Korea’s new president has authorized national pension investments in Bitcoin and greenlit spot Bitcoin ETFs. Additionally, Bitcoin’s liquid supply has fallen 30% over the past 18 months, as nearly 1 million BTC have been withdrawn from exchanges—a strong bullish signal of long-term holding by institutions. Three U.S. states are also now allowing BTC reserves, further legitimizing its role as a reserve asset.
