Bots is eyeing “per transaction” royalties from firms operating Bitcoin ATMs in the light of its newly acquired patent
Puerto Rico based blockchain and robotics firm Bots has announced that it is exploring its legal options to launch litigation against firms operating Bitcoin ATMs across the United States. Bots has explained that it is taking the advice of a “major law firm” in order to determine its next course of action in the light of its newly acquired patent.
The company acquired a patent for protocols underpinning the operation of Bitcoin ATMs two weeks ago and has currently stated that the development makes it eligible for millions in monthly royalties.
Bots’ chief executive Paul Rosenberg claimed that the company owns the intellectual property that is fundamental to the operation of Bitcoin ATM networks. Thus, Bots is eyeing “per-transaction” royalties from Bitcoin ATM manufacturers, he explained.
“Per-transaction royalty payments will be negotiated for a several-year term. Some agreements, especially with the manufacturers, could cover previous years and/or a significant number of coming years”, he stated.
The growing demand for cryptocurrencies including Bitcoin in recent times has led to a 50% increase in the number of Bitcoin ATMs from around 4000 in 2019 to around 9400 now. The ATMs are estimated to be processing between 130 and 180 transactions monthly. Bots believe that the ownership of the patent can drive $14 million to $18 million dollars in monthly royalties. However, whether the figure is an ambit claim to open up negotiations or if the technology is as crucial as the company claims is still in question.
While the patent was originally filed in 2014, Bots acquired the rights to U.S. Patent No. 9,135,787 B1 “Bitcoin Kiosk / ATM Device and System Integrating Enrollment Protocol and Method of Using the Same” on the 29th of October through its subsidiary First Bitcoin Capital.
First Bitcoin Capital itself acquired the patent in July last year and launched an unsuccessful attempt to secure up to $50 million in royalties by 2024. Bots began acquiring First Bitcoin Capital’s crypto assets and related technologies from July of this year and seems to have taken over the patent royalties campaign.
Bots hopes to “reach an amicable arrangement without litigation” with the US-based ATM operators, noting that it will be “offering those operators to join a consortium of Bitcoin ATMs”.
The company also claims that it is in the process of developing a “Worldwide Bitcoin ATM network” that enables interoperability between Bitcoin ATM terminals regardless of the company operating the machine.
The crypto community has historically condemned the use of patents to restrict access to technology. The US-based financial services company Square announced in September that it will form a “Crypto Open Patent Alliance” to “help the crypto community defend against patent aggressors and trolls”.