Wells Fargo joins the move to tokenisation

July 20, 2018
Chris Wheal

US financial group Wells Fargo has filed a patent for a blockchain-based “system and methods to manage a tokenisation manifest”; essentially a system in which any type of data element – is whether a document, graphic, or database value – could be located, accessed, and protected by means of tokenisation.

Patent License Agreement

The patent application was published on July 17: Shutterstock

The filing was published on Tuesday, July 17 by the US Patent and Trademark Office (USPTO). As detailed in the application, tokenisation uses encryption methods to process an originally unrestricted data element into a corresponding restricted token that can subsequently only be retrieved — or ‘detokenised’ — by a specified user, making it suitable for the management and protection of sensitive data.

The tokenised system uses cryptography to bind specific values to data under an authenticated digital signature. This enables it to be used to both control access and confidentiality, authenticate data origins, and maintain data integrity by detecting any undue modifications to an element.

The patent application by San Francisco-based Wells Fargo includes plans to develop a bank-run “tokenisation service provider” that could tokenise pieces of information–documents, photographs, video, audio, and other items of digital media. Content owners would submit the pieces of media for the bank to create a token.

Additionally, the patented system would allow multiple authorised entities to access a piece of tokenised information. “Unlike the limited, anonymous signatures supported by existing systems, this tokenisation manifest supports single signers, multiple signers, or co-signers to store information publicly without loss of confidentiality of any sensitive content,” reads the document.

The beginning of a crypto revolution

Last month, Jeremy Allaire, co-founder and chief executive of payments company Circle, spoke at the MoneyConf Dublin event of an unprecedented “crypto revolution,” and suggested that society is “at the beginning of a tokenisation of everything” that will extend to “every form of value storage and public record.”

MasterCard logo

Mastercard follows hard on the heels of MasterCard: Shutterstock

In filing a blockchain-related patent, Wells Fargo is following other major financial institutions. In January, a report stated that Bank of America had filed at least 43 blockchain-related patents and this week MasterCard also filed a patent with the USPTO that granted in the right to “[manage] fractional reserves of blockchain currency” with the creation of a debit card that would allow its holders to spend both crypto and fiat currencies. MasterCard has also obtained many blockchain patents.

While Wells Fargo is embracing the technology that underlies cryptocurrencies for its own purposes, the bank last month prohibited customers from purchasing crypto using credit cards issued by Wells Fargo due to perceived investment risks. In April this year, it was sued by cryptocurrency exchange Bitfinex for placing embargoes on bank transfers that prevented the exchange from being able to deposit customers’ funds in their bank accounts.

However, Wells Fargo was also involved in what the world’s first reported interbank trade was using a blockchain system in 2016, for an international freight shipment to China.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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