Tech
Why does Maxine Waters care about Meta’s crypto trademarks?
In early 2022, Arun Sundararajan wrote a Harvard Business Review topic of study about how established brands could use non-fungible tokens, aka NFTs, right before the cryptocurrency market crashed. In the article, Harold Price, a professor of entrepreneurship at New York University’s Stern School of Business, tried to make sense of the then-cryptocurrency craze, mentioning that tech companies like Twitter and Facebook (now X and Meta, respectively) they allowed for greater user customization. via NFT avatar.
This is an excerpt from The Node newsletter, a daily roundup of the most crucial crypto news on CoinDesk and beyond. You can sign up to get the full service newsletter here.
“Properly designed, NFTs could build on the expansion of conspicuous consumption seeded by social media, allowing us to showcase our non-digital lives in our digital spaces more broadly and authentically,” Sundararajan wrote, arguing that NFTs are “becoming mainstream in 2022″. .”
Little did Sundararajan know that within a few weeks the entire cryptocurrency market would hit rock bottom and NFTs would collapse. Meta will soon discontinue the NFT functionality on its Instagram and Facebook apps, to refocus on “areas where we can have a large-scale impact” during its “year of efficiency,” after the company’s turn to the metaverse hit a wall.
This wasn’t the first time Facebook’s crypto plans were foiled. In fact, there could be an entire issue of HBR on the pitfalls of established companies experimenting with cryptocurrencies based on Facebook’s failed blockchain efforts. His plan for the Libra stablecoin, conceived in 2019, envisioned a radical alternative global currency before it was raped by regulators. Then the company pulled the plug on Diem, a significantly scaled-back stablecoin project, after investing a significant amount of resources in developing a new blockchain, wallet, and programming language.
If there is one company that is likely to stay away from blockchain, even if the market appears to be recovering, it is probably Meta. This doesn’t mean that Meta, which is as opportunistic as any company, will always stay away. But it’s hard to imagine it can advance cryptocurrency adoption much these days. Especially considering Mark Zuckerberg recently announced is directing the vast resources of the largest social media platforms towards the development of artificial general intelligence (AGI).
All of this is why it’s strange to hear Meta being questioned by Congress about its crypto activities. In a letter to the CEO of Meta Mark Zuckerberg and COO Javier Olivan, Rep. Maxine Waters (D-Calif.) expressed concern over a pair of blockchain-related trademarks filed by the company. Even stranger, the trademark applications date back to 2022. So why did Waters, who led the resistance to Libra/Diem in 2019, send the letter Now?
Waters, a ranking member of the powerful Democratic House Financial Services Committee, believes the live brands represent Meta’s “continued intention” to expand its role in the digital assets market. This would refute statements made by Meta representatives during a committee meeting last October that “there is no digital asset work underway” at the company.
According to Waters, Meta will soon have to respond to the US Patent and Trademark Office, which has sent the company five Notice of Guarantee (NOA) documents indicating that Meta’s five blockchain trademarks meet its registration requirements, answering whether it intends to use the trademarks . The company has until February 15 to respond to the first of five NOAs it has received, so the timing of Water’s questions seems about right. He essentially wants to know in advance how Meta will respond.
Yet, the letter also has a broader scope: it asks if Meta has any cryptocurrency projects. Waters specifically asked whether Meta has any future stablecoin plans or partnerships, is “planning to launch a payment platform,” and whether “Meta’s technology is enabling the creation, mining, storage, transmission or settlement of cryptocurrencies”. It’s as if any amount of cryptocurrency-related research and development in Meta is a matter of national interest.
The broad investigation may be warranted given the broad nature of Meta’s applications, which include ideas for digital asset wallets and hardware, chain validation technology, “blockchain as a service” advertising, and apparently even a dating app with ” a specific branch tailored for investors.”
But having an approved trademark or patent doesn’t mean a company will actually put it into practice. There are many applications presented as a defensive maneuver or even just to create the illusion of progress. In an industry like cryptocurrency that grew out of the broader open source community, projects that place an emphasis on intellectual property are often the least exciting.
Waters, being one of the first lawmakers to speak out against Libra and knowing the power regulators can wield, must recognize that these brands are not really an indication of activity. If she was worried about Meta getting involved in the cryptocurrency world again, it would be much more significant if the company filed applications after 2022. But a cursory look shows that this is not the case.
There is a Straussian reading of Waters’ letter that asks no questions about Meta’s crypto activity, but makes a statement to Meta and beyond. Big tech may not be fully on board with cryptocurrencies again, in a rising market cycle. But even if it were, it is being watched.
CORRECTION (JANUARY 23, 2024): Clarifies that Meta must respond to trademark applications, not patents. Also corrects the name of the Democratic House Financial Services Committee.