Stablecoin issuer Circle Internet Group has acquired IBM’s extensive blockchain patent portfolio, giving the company ownership of nearly 1,000 issued patents. The move, announced on Monday, has made Circle the largest holder of blockchain patents in the United States.
The financial terms of the deal were not disclosed though. The acquisition covers more than 680 patent families covering blockchain technology, banking, financial services, insurance, enterprise infrastructure and cloud security, Circle said.
IBM was among the largest holders of blockchain patents in the U.S. before the deal, alongside Bank of America.
The patents will help strengthen the technology behind several of its products including the USDC stablecoin, the Circle Payments Network and its Arc blockchain platform, Circle said.
“Intellectual property is critical to advancing our mission and expanding adoption of onchain infrastructure,” the company said in a statement.
Circle expands beyond stablecoins
The acquisition is a significant step in Circle’s evolution from a stablecoin issuer to a more general blockchain infrastructure provider.
Though USDC remains its flagship product, Circle has been moving into cross-border payments, developer tools and blockchain-based financial services in recent years.
The new patents are expected to support that broader strategy, but the company has not explained how individual patents will be used in its products.
Circle’s first blockchain-related patent (blockchain data processing) was granted in December 2023. Instead of slowly growing its portfolio over time, it has rapidly expanded its intellectual property portfolio through the acquisition of IBM’s.
The collection includes technologies across payment systems, transaction security, enterprise blockchain applications and cloud computing, which could become more important as more financial institutions adopt blockchain technology.
Circle did not say whether IBM would retain any licensing rights or continue to use the patented technologies after the sale.
Patent deal highlights blockchain’s evolution
The deal is a sign of progress the blockchain industry has made over the last 10 years. IBM was among the first corporate supporters of enterprise blockchain, investing heavily in distributed ledger technology and creating blockchain solutions for businesses.
Many of those early efforts have since fallen out of the spotlight, but the underlying intellectual property remains valuable as blockchain finds new use cases in payments, tokenisation and digital finance.
For Circle, the acquisition is about acquiring technology that can help power its long-term growth as demand for blockchain-based financial infrastructure continues to grow.
The company has been positioning itself more and more as a bridge between traditional finance and digital assets with services that extend far beyond stablecoins.
The company already has one of the largest blockchain patent portfolios in the industry, and could also strengthen its position as banks, payment companies and financial institutions continue to explore onchain applications.
The announcement comes as the share prices of both companies are languishing. Circle’s stock has fallen 66 percent in the past year while IBM shares are down 18 percent over the same period.
“The market environment is difficult but this acquisition demonstrates that Circle is still committed to its long-term strategy. Instead of merely growing USDC, the firm is developing the technology and intellectual property it believes will underlie the next generation of blockchain-based financial services.
