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Ripple Wins US Patent for New Oracle-Based Smart Contract Design
Ripple's patented design would allow derivatives to settle based on external information – such as temperature data.
By Paddy Baker
Updated Sep 14, 2021, 10:03 a.m. Published Oct 2, 2020, 1:37 p.m.
Blockchain payments technology firm Ripple has won a patent for a design that can execute smart contracts based on data collected from the outside world.
STORY CONTINUES BELOW
- Earlier this week, Ripple Labs received a patent (No. 10,789,068) for a smart contract that can use oracles to connect a distributed platform to a variety of different real-world data.
- Originally filed in June 2018, one example of a use case provided includes using the smart contracts to automatically settle options contracts when pre-agreed conditions are met, such as a company's debt-to-equity ratio hitting a certain threshold.
- Another example, for the oil industry, is feeding data on the density of a specific crude oil shipment to help a smart contract determine whether to make a trade.
- Smart contracts are mostly associated with Ethereum, but other large blockchains are looking to add similar capabilities.
- Earlier this year, derivatives exchange BitMEX, which is now facing legal troubles, awarded a $50,000 grant to a Bitcoin Core contributor to develop a Bitcoin smart contract.
- One of the two authors of the patent, Ripple’s former CTO Stefan Thomas, previously revived a defunct project called Codius – one working to bring smart contracts to Ripple – into a new startup, Coil.
- While a patent indicates that time and effort going into a rough draft of, in this case, a new smart contract-based derivative, it doesn't necessarily mean that Ripple has any active plans to move ahead with development.
- CoinDesk reached out to Ripple for comment but hadn't received a response by press time.
See also: August's Bitcoin Rally Led to Record Crypto Derivatives Volumes: Report
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