Marathon, Core Scientific hit with Cryptography Tech lawsuit over patent infringement

A high-stakes Cryptography Tech lawsuit has ensnared two of Bitcoin’s biggest miners, Marathon Digital and Core Scientific, in a legal battle over alleged patent violations tied to the blockchain’s core security technology. Filed by Malikie Innovations, the case threatens to send shockwaves through the crypto mining industry, setting a pivotal precedent for how intellectual property disputes impact decentralized networks.

Two of the world’s largest Bitcoin mining companies, Marathon Digital and Core Scientific, are facing legal action over alleged patent violations tied to the very technology securing the Bitcoin blockchain. The case, filed by Malikie Innovations, could have far-reaching consequences for the crypto mining industry.

BlackBerry’s patent powerhouse strikes

Malikie Innovations, which acquired 32,000 patents from BlackBerry in 2023, claims that Marathon and Core Scientific are unlawfully using Elliptic Curve Cryptography (ECC), a core component of Bitcoin’s security protocol, covered under its intellectual property.

The Cryptography Tech lawsuit alleges that the miners’ operations rely on ECC-based methods that Malikie now owns. If successful, the case could force the defendants to pay years of back royalties, potentially amounting to millions, and even push them toward bankruptcy.

Why this Cryptography Tech lawsuit could be a major blow

Legal experts warn that a victory for Malikie could set a dangerous precedent. Aaron Brogan, founder of Brogan Law, told Cointelegraph:

“Miners are lucrative targets because they have deep pockets. If Malikie wins, they could go after other U.S. miners, disrupting Bitcoin’s network security.”

However, Brogan doubts individual Bitcoin users will face repercussions. “Pursuing everyday users isn’t practical, they’re often ‘judgment-proof,’ meaning they don’t have assets worth suing for,” he explained.

Could this Cryptography Tech lawsuit threaten Bitcoin’s future?

The case raises concerns about whether patent holders could destabilize the entire crypto ecosystem. Niko Demchuk of AMLBot noted that Malikie’s claims may not hold up in court:

“If the patents are expired or too broad, the case could collapse. Bitcoin’s ECC implementation might not infringe on specific, enforceable claims.”

Yet, uncertainty remains. A ruling in Malikie’s favor could force miners to license the technology or shut down operations entirely.

A history of crypto patent battles

This Cryptography Tech lawsuit isn’t the first time Bitcoin’s foundational tech has been challenged. In 2021, Craig Wright, who falsely claims to be Bitcoin’s creator, Satoshi Nakamoto, forced bitcoin.org to temporarily remove the Bitcoin whitepaper in a failed copyright bid. Wright himself filed over 100 blockchain-related patents between 2017 and 2019.

What’s next in the Cryptography Tech lawsuit?

Legal analysts predict a prolonged battle. If Malikie wins, it could:

• Demand six years of retroactive royalties.

• Force miners to negotiate licensing deals.

• Trigger similar lawsuits against other crypto firms.

For now, the crypto industry watches closely as this Cryptography Tech lawsuit unfolds, one that could redefine patent enforcement in blockchain technology. The Bit Gazette will keep you updated with developments as they happen.