Nasdaq applies for blockchain patent to back up exchange transaction records

Nasdaq is currently applying for a patent that would use blockchain to record exchange transactions.

On October 6, 2016, the U.S. Patent and Trademark Office (USTPO) published a patent application for a 'system and method for blockchain transaction records'. The application was originally filed by Nasdaq on March 31. The patent applicants are Tom Fay, Nasdaq's senior vice president of enterprise architecture, and Dominick Paniscotti, associate vice president of enterprise architecture.

Essentially, the filing details a trading system consisting of digital wallets, an order booking and matching engine, and a ‘closed blockchain’ that acts as a transaction record that is updated in real time as participants take action.

According to the patent application:

“The data processing requires a match with the hash of the digital wallet to which it is associated. The transaction party receives the hash and matching information of the other party, and the parties can add the blockchain transaction to the blockchain of such blockchain computing system.”

The exchange can check the contents of the blockchain to find data related to these digital wallets, while also keeping an additional copy of the information in a separate database.

It’s not surprising that Nasdaq would pursue patent applications related to blockchain technology. Last year, the exchange operator launched Linq, a blockchain project dedicated to private markets, and in May this year, Nasdaq also launched new blockchain services for its global customers.

The content of the patent application shows that the company is largely seeking to claim ownership of a method for using blockchain in an exchange environment, rather than the system itself. USTPO records show that Nasdaq initially sought a series of proprietary claims related to the technology, but withdrew them when it actually submitted the application in March.

The full version of the patent application document is available for viewing.