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Uniswap Beats Bancor Claims as Judge Calls Patents Too Abstract
Key Takeaways
- A New York judge ends Bancor’s patent case after finding the disputed claims too abstract to qualify for US patent protection;
- The court states that exchange-rate calculations are routine economic ideas and cannot support the patents asserted against Uniswap;
- Bancor’s argument about blockchain use fails, as the judge says known tools do not turn an abstract method into a patent-eligible claim.
Uniswap
The judge decided that the patents in question are too abstract to receive protection under US patent law.
The order came from Judge John G. Koeltl of the US District Court for the Southern District of New York on February 10. He approved Uniswap’s request to end the lawsuit filed by Bprotocol Foundation and LocalCoin Ltd. against Universal Navigation Inc. and the Uniswap Foundation.
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According to the ruling, the patents focus on the basic concept of calculating cryptocurrency exchange rates. Under the two-step test set by the US Supreme Court, this type of claim cannot qualify for patent protection.
Koeltl explained that calculating exchange rates is a common economic activity and that pricing calculations are considered abstract under existing federal case law.
Bancor had argued that Uniswap used protected technology tied to a “constant product automated market maker". This system supports features used in decentralized exchanges, such as automated pricing and liquidity pools.
The dispute centered on whether Uniswap’s protocol relied on methods that Bancor claimed were patented.
The judge rejected arguments that placing the calculation method on a blockchain made the patents valid. He said the filings rely on known blockchain and smart contract tools in expected ways to solve an economic issue.
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