Brian Armstrong, the CEO of Coinbase, has received a US patent for an invention that makes sending bitcoin easier.
Making Bitcoin simpler with e-mail
The patent was issued last Tuesday but was already filed in March 2015. This patent describes a system that allows users to send bitcoin more easily. E-mail addresses are linked to receiving addresses of wallets.
The sender makes a request to send cryptocurrency to an e-mail address and the system automatically sends the agreed amount, if there is enough balance, to the correct wallet. That wallet must then already be linked to an email address.
The system needs 48 hours to confirm the transaction once the recipient has confirmed the payment. Cryptos that are not currently required are stored in a secure vault that can only be accessed with the e-mail address associated with the corresponding wallet.
No transaction costs
Coinbase earns well in transaction costs. Since 2012, they have already earned more than $ 2 billion in transaction costs. However, they do not charge extra costs for this service. The stock exchange itself pays for the costs, provided that the cryptos remain within the Coinbase ecosystem. Transactions to external wallet addresses are possible, but may not be free.
The patent specifically mentions bitcoin and does not state whether the system also supports other cryptocurrencys. But the step to other cryptos initially does not seem very large. It also seems as if all email providers are supported.
Two other patents were granted to Coinbase on Tuesday. One is an application to ensure that user accounts comply with international and local legislation, the other an enforcement protocol for closing accounts.
The whole idea behind this e-mail system is to make cryptocurrency easier. Maybe you are not the target group, but there are many people who do not dare to step into cryptocurrency because they do not understand. That’s what Armstrong says:
“The vision for Coinbase is to create more economic freedom for every person and every company in the world in the next 10 years.”
What does the patent say?
The patent can be read here. The most important passage is translated below into Dutch:
“A system and method for bitcoin transactions is described. Bitcoin can be sent to an e-mail address. No miner’s fee is paid by a host computer system. Hot wallet functionality is provided that transfers values from some bitcoin addresses to a vault for security purposes. A private key of a bitcoin address of the vault is split and distributed to keep the vault safe. With direct exchange, sellers and customers can set a price in local currency. A vault has multiple e-mail addresses to allow a bitcoin transfer from the vault. The user can choose to store private keys in locations that are under his control. “