Bancor’s nonprofit arm, the Bprotocol Foundation, along with LocalCoin Ltd., has filed a patent infringement lawsuit against Uniswap Labs and the Uniswap Foundation. The case was submitted to the U.S. District Court for the Southern District of New York, alleging that Uniswap has used Bancor’s patented technology without authorization for over eight years.
At the heart of the dispute is Bancor’s Constant Product Automated Market Maker (CPAMM)—a key innovation that enables decentralized token swaps without a centralized order book. Bancor claims this foundational mechanism, originally developed in 2016, was officially patented after a U.S. provisional application was filed in January 2017.
The Stakes: Eight Years of Alleged Infringement
Bancor is seeking damages for what it describes as eight years of unlicensed use of its CPAMM structure by Uniswap, which has since become one of the largest decentralized exchanges (DEXs) in the world. According to the complaint, Uniswap’s protocol relies on the very same automated market-making model that Bancor pioneered and legally protected.
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The lawsuit raises critical questions for the broader DeFi ecosystem, where open-source protocols have long thrived on shared innovations. If the court sides with Bancor, the ruling could potentially set a precedent affecting numerous DeFi projects that rely on similar mechanisms.
Industry Response and Uniswap’s Next Move
While Uniswap Labs has yet to issue a public response, the DeFi community is already buzzing with speculation. Some see the lawsuit as a threat to DeFi’s open-source ethos, while others argue that intellectual property rights should be respected—even in decentralized environments.
This legal confrontation could shape how future DeFi protocols handle innovation, intellectual property, and competition.
Bancor’s lawsuit against Uniswap could become a watershed moment for the DeFi industry, forcing a reevaluation of how innovation, collaboration, and legal rights coexist in a decentralized world.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
