Story Protocol: A New Paradigm for Intellectual Property Management Empowered by Blockchain Technology

With the development of the times, intellectual property ( IP ) has become an important asset class, covering a wide range of areas from software code, artistic works to scientific inventions. The value of the global intellectual property market reached approximately $180 billion in 2020 and is expected to grow at an average annual compound growth rate of about 8.5% in the coming years.

In 2020, the global patent application volume exceeded 3.27 million, an increase of 1.6% compared to 2019. The trademark application volume saw a significant increase, reaching approximately 17.1 million, with a growth rate of 13.7%. These data indicate that even amid the impact on the global economy, businesses and individuals are still actively using intellectual property tools to drive innovation and expand their operations.

Asia is particularly active in intellectual property activities, accounting for 64% of the total global patent applications in 2020. In particular, China holds the largest share of global patent applications. These trends indicate that there is great potential for future development in the intellectual property market.

However, as the IP market continues to grow, the complexity of IP management is also increasing. The traditional IP management model relies on centralized legal systems and manual verification, which appears inefficient and difficult to adapt in an era of rapid digital development. At the same time, traditional IP management faces issues such as easy infringement, difficulty in authorization, and low transparency. The laws regarding IP vary between different countries and regions, making it challenging to fully protect the rights of IP owners.

Specifically, traditional IP management faces the following challenges:

1. Insufficient liquidity: The lack of a unified platform means that trading and authorization of IP must go through complex legal procedures, which are time-consuming, labor-intensive, and costly.

2. Protection and Transparency Issues: In the United States alone, losses from digital piracy amount to as much as $50 billion each year. Traditional legal protection methods struggle to track infringement, and the process of gathering evidence and asserting rights is complex.

3. Obsolescence of the Legal System: The existing IP legal framework is primarily designed for the physical world and does not align with the needs of the digital age.

In this context, tokenizing IP and introducing it to the Blockchain, making it programmable and directly managed by the IP owner, may be one of the ways to address these issues.

Story Project Introduction

Story is a revolutionary IP management platform based on Blockchain technology, dedicated to fundamentally changing the way stories are created in the narrative world. Its core mission is to unlock a brand new way to create, manage, and license intellectual property on the chain, thereby forming a "story legos" ecosystem that can be remixed and combined.

The Story Protocol supports the entire lifecycle from IP creation, management to authorization, providing functions such as source tracking, frictionless licensing, and revenue sharing. This allows creators to create more freely and benefit from their work. Additionally, the platform allows anyone to contribute to and remix existing creations, ensuring that the value of these contributions can be captured and distributed.

The development history of the Story project is as follows:

• Early 2022: Story Protocol was founded, bringing together blockchain technology experts, legal advisors, and leaders in the creative industry, with the aim of developing a platform that supports global creators and businesses in managing and commercializing creative assets.

• Mid-2022: The team is committed to building vertically integrated technical solutions to support complex IP data structures and decentralized management models.

• Early 2023: Launched the iconic proof of creativity protocol. Creators can register, verify, and protect their creative works on the platform, and achieve automated royalty payments and license management through the protocol.

• 2023-2024: Story Protocol has gone through three rounds of financing, receiving investments from dozens of top VCs including a16z, with funding exceeding $150 million.

Story Network: General-purpose Layer 1 Blockchain

Story Network is a general-purpose Layer 1 Blockchain specifically designed for efficiently processing complex data structures (, particularly data related to intellectual property ). This network is based on a combination of the Ethereum Virtual Machine ( EVM ) and Cosmos SDK, leveraging the strengths of both to achieve high performance and flexibility in IP operations.

The main features of Story Network include:

1. EVM Compatibility: Provides the same code execution environment as Ethereum, allowing developers to directly port Ethereum applications written in Solidity to the Story Network with minimal modifications. This reduces development costs and shortens development time.

2. Cosmos SDK Framework: Enhancing the network's scalability and transaction efficiency. The Cosmos SDK provides efficient consensus mechanisms and cross-chain interoperability, enabling the Story Network to maintain low latency and low costs when handling a large number of transactions.

3. Complex data processing capability: Introduce a graphical data storage mechanism that can quickly and cost-effectively traverse large IP relationship networks, ensuring that the relationships and royalty distributions of each creative asset can be accurately tracked and managed.

These features enable Story Network to support a wide range of IP management and commercialization use cases, such as automatic licensing, royalty payments, and dispute resolution.

Proof-of-Creativity protocol

The Proof-of-Creativity protocol is one of the cores of the Story Network, providing foundational support for the digitization and automated management of IP. By being natively integrated into the Story Network, this protocol enables features such as permissionless licensing and automatic royalty payments, offering a new, decentralized approach to intellectual property management for creators and businesses worldwide.

On the Story Network, programmable IP becomes a reality. IP is no longer just static legal terms and contracts, but smart contracts that can take autonomous actions. This programmability brings automation, transparency, and reliability to IP management, making the management structure more efficient and convenient.

The implementation of programmable IP is based on two key pillars:

1. Asset Tokenization: Creators can register creative assets as on-chain IP assets, existing in the form of non-fungible token (NFT), representing intellectual property in the real world and stored in a comprehensive registry. This ensures the uniqueness and immutability of each IP, providing creators with transparent proof of ownership.

2. Customized Business Logic: Each registered IP asset is equipped with its own IP account, enabling complex interactions and business logic through modules. The module supports features such as permissionless licensing and automatic royalty payments, and developers can also create custom modules to meet advanced business needs.

The Proof-of-Creativity protocol simplifies the IP licensing process through pre-configured licensing modules:

• Ready-to-use License Agreement: Provides a ready-to-use license agreement similar to the Y-Combinator SAFE template, covering all media types, allowing creators to define and add custom licensing terms in seconds.

• License Token: Use license tokens to manage licenses, which represent the digital assets of the license. Anyone can obtain a license token to create derivative works, along with the creator's preferred licensing terms.

In terms of royalty payments, the Proof-of-Creativity protocol ensures automation and transparency:

• Liquid Absolute Percentage (LAP): defines how to share revenue in the derivatives Blockchain. Each IP asset can choose downstream distribution of royalties, and revenue from derivative works will be automatically allocated to the original creator according to a predefined ratio.

• Automated execution and transparency: All royalty calculations and payment operations occur on the Blockchain, making them error-proof and immune to third-party interference. Creators can ensure that their income arrives on time, addressing common delays and disputes in traditional royalty payments.

Programmable IP License

The Programmable IP License, PIL(, is a core innovation of Story Network that enables intellectual property to be introduced to the Blockchain, bringing on-chain liquidity and programmability to a trillion-dollar asset class.

PIL introduces real-world intellectual property to the Blockchain through tokenization and a universal licensing protocol. This process is not just a simple asset on-chain, but rather a bidirectional connection that tightly links on-chain assets with the real-world legal system. PIL is like the "Y-Combinator SAFE" for intellectual property, providing legal protection and ensuring that creators retain control over their works.

PIL is a general licensing protocol that allows IP owners to set rules for the use of their intellectual property. Creators can easily set the terms of use for their works without the need for complicated legal procedures. PIL offers a range of pre-configured options:

1. Non-commercial social remixing: Allows others to remix the IP into their works and distribute it, but resale or commercialization is not permitted.

2. Commercial Use: Allows others to purchase usage rights at a set price, can be used to display or publish works, but resale or creation of commercial mixes is prohibited.

3. Commercial Mix: Based on commercial use, it allows others to create mixes and distribute them, while also setting a percentage for commercial revenue sharing.

In addition to the pre-configured options, PIL also supports custom licensing protocols, allowing developers to easily attach and parameterize these licensing protocols through the Story Network SDK.

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Application Landing

Story Network has established Story Academy, a program designed for builders and innovators, aimed at supporting, guiding, and accelerating innovative projects built on the Story Network. The program provides comprehensive technical support, marketing strategies, funding, and an investor network to help entrepreneurs realize their dreams.

With the support of Story Academy, several projects have successfully applied the relevant protocols of Story Network:

1. Magma: A multi-user online design tool suite that supports over 2 million users, allowing creatives to collaborate in real time. Through Story's tokenized IP program, creatives can easily register their works as IP assets and set usage terms through PIL.

2. Mahojin: Focused on the IP tokenization of AI training data, models, and outputs. Data owners can register their datasets as IP assets on Story and set licensing terms. This ensures that AI model creators can quickly and cost-effectively obtain high-quality training data while safeguarding the rights and interests of data providers.

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Summary

The Story project has the following advantages in the field of IP management:

1. First-mover advantage: Story has made early arrangements in the IP market, giving it a certain first-mover advantage.

2. Capital support: Cumulative financing exceeds 120 million USD, favored by capital.

3. Complete ecosystem: Includes a general first-layer Blockchain, Proof-of-Creativity protocol, and programmable IP licensing, building a complete IP management ecosystem.

4. Landing Applications: Several projects have successfully applied the relevant protocols of Story Network, demonstrating a good practical application prospect.

However, the current IP market is still immature, and the Story project still needs time to be tested. With the development of blockchain technology and the maturation of the IP market, Story is expected to play an important role in the field of intellectual property management.

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