A Great Idea to Raise Funding for Research: University of Pennsylvania and NFTs

The University of Pennsylvania appears to be one of the first universities to use NFTs to raise additional funding for research.  The university is offering for sale an NFT that commemorates the development of the mRNA technology used to develop vaccines for COVID-19.  Here is a description of the project:

The NFT features a stunning, one-minute 3D animation of the type of modified mRNA that protects the immune system from SARS-CoV-2 and the platform technology which holds promise for combatting other infectious diseases, as well as immunotherapeutics, cancer treatments, genetic diseases, and more. The video shows mRNA encapsulated inside of lipid nanoparticles, the fat droplets that are the delivery technique Weissman’s lab applied to ensure mRNA reaches the right part of the body to trigger an immune response. The NFT also includes images of Penn mRNA patent documents and a letter from Weissman, who directs the Penn Institute for RNA Innovation, about the ways in which he and colleagues are leveraging the mRNA technology platform to fight not only coronaviruses but also influenza, herpes, malaria, sickle cell anemia and cancer.

Funds raised by the sale of the NFT—the first digital asset Penn has offered—will further important research across the university.

NFTs and Financing the Future of Potential Stars

NFTs are getting a lot of press.  For sure, NFTs have made a big splash in the art world.  I had an interesting conversation with a friend today about financing young athletes through the monetization of their right of publicity since the NCAA (and states) have begun allowing collegiate athletes to profit from their image etc.  One interesting issue concerns aspiring professional tennis players.  Often those players must make a decision between attempting to finance a shot at a professional career—a very expensive prospect, or go to college and see what develops.  Notably, as a friend mentioned to me, there are numerous excellent young tennis players who cannot finance the expenses to start a pro-career—expenses such as travel, coaching and trainer fees, hotel etc.  Many have to give up on a promising career because of a lack of funding.  Interestingly, this is a sport where economic class plays a big role—kids with less resources are unable to be developed and never get a legitimate shot at the pro-tour.  Allowing young players to monetize their right of publicity without damaging college prospects may be an interesting way for them to gather resources to support a professional career in the future and develop (maybe crowd-funding works).  Local businesses, family, friends and others could invest in young players early.  But, what if we could sweeten the deal?  What if we could use NFTs to create a market for, as an example, electronic playing cards for young athletes?  Can you imagine what the NFT “playing card” for an athlete such as a young Andre Agassi, Messi, Ronaldo, or Michael Jordan may be worth after they develop in the future?  There are a lot of details to sort out, but you can see how a market can develop creating an enormous amount of value and good (and yes, a potential for bad).  See here for Topps entry into the NFT market for trading cards: Topps Digital Launching Baseball Card NFTs (beckett.com).  What if we could expand the concept further?  There's no doubt that we are at a place where maximizing the potential of human resources is our greatest challenge.  This could be a way to help.  Extend it to brilliant children to finance their education?  IP and NFTs at their best?  It's an interesting thought experiment. 

IPwe's Forthcoming NFTs Patent Marketplace

IPwe is attempting to create a marketplace for patents through the utilization of blockchain technology, specifically NFTs. I heard a somewhat similar idea floated about five or so years ago concerning blockchain.  It is an interesting proposal, and we will have to see how it works out.  I am excited that folks are moving forward with the idea; however, I do think there are numerous issues that need to be worked out.  I am working on a forthcoming co-authored paper exploring some related issues. Here is the IPwe press release:

IPwe today announced plans to begin representing patents as non-fungible tokens (NFTs) or digital assets by working with IBM (NYSE: IBM) to create the infrastructure for representing patents as NFTs and storing the records on a blockchain network. The tokenization of intellectual property (IP) will help position patents to be more easily sold, traded, commercialized or otherwise monetized and bring new liquidity to this asset class for investors and innovators.

IPwe, working with IBM, was the first to create a patent marketplace on the blockchain.

Tokenization provides greater transparency and can also make related transactions simpler and more cost-efficient. By representing IP in this way, it can be licensed, sold and commercialized. Organizations can also more easily view the IP as an asset on their balance sheet. While NFTs have been used to represent digital art, sports memorabilia and even iconic Tweets, the early adoption of IP-based NFTs could usher in a transformation of how IP is treated by inventors and enterprises.   

"The IPwe Platform is designed to transform the patent asset class by increasing transparency and promoting engagement, which we believe will encourage innovation," said IPwe CEO Erich Spangenberg. "The use of NFTs to represent patents will help create completely new ways to interact with IP. This is expected to benefit not only large enterprises that have significant intellectual property, but it will bring new opportunities to small and medium enterprises and even individual IP owners. We believe it will usher in new offerings by financial services firms and corporations to promote the evolution of a new patent asset class." 

These NFTs will be stored and shared on the IPwe Platform, hosted on IBM Cloud and powered by IBM Blockchain. The IPwe Platform also enables the Global Patent Marketplace, which allows owners and other members of the patent ecosystem to engage and transact, buy, license, finance, sell, research and commercialize patents. IPwe, working with IBM, was the first to create a patent marketplace on the blockchain. The introduction of NFTs will only help accelerate the opportunity for IP, which has been notoriously difficult to manage, value and transact, to be treated as a liquid asset. 

IPwe will soon begin trials of its NFTs on the company's Global Patent Marketplace. 

According to IPwe, many enterprises, governments, universities and small and medium enterprises (SMEs) around the world are already using their technology, including the IPwe Platform and the IPwe Registry and Global Patent Marketplace. For SMEs in particular, representing patents as digital assets is especially powerful because it allows IP to be treated as collateral or assurance of an organization's value, also allowing it to be more easily leveraged when seeking funding. The IPwe Registry collects current, active and historical patent records in a single freely accessible registry with enhanced search enabled by IBM AI. A broader ecosystem including financial institutions, insurers, enterprises and other patent stakeholders are planned in the coming months to support the use and exchange of tokenized patents using these new technologies.

IBM and IPwe have worked together for the last three years applying IBM's deep expertise in blockchain and artificial intelligence to the IPwe Platform to help protect ownership information; generate patent and portfolio analytics; facilitate transactions; reporting and advancements of the next intelligent generation of patent pooling - an agreement among multiple patent holders to jointly license their IP. 

"IBM has a long history of leadership in intellectual property and the application of AI and blockchain in business. Our work with IPwe is another example of our collaboration with leading innovators to drive outcomes powered by blockchain capabilities and digital assets that have the potential to transform entire industries," said Jason Kelley, General Manager, Global Strategic Partnerships, IBM Services. "As businesses increasingly look to transform how they work with intelligent workflows, blockchain technology is a critical tool to increase transparency and reduce barriers."

To learn more about participating in the NFT trials on the IPwe Platform anticipated to start in Q2, or joining the ecosystem please visit here. 

IPwe anticipates tokenized IP on the platform to be commercially available in Q4 2021.