Notice of Pre-AIA or AIA Status
The present application, filed on or after March 16, 2013, is being examined under the first inventor to file provisions of the AIA .
Response to Arguments
Applicant's arguments filed 18 February 2026 with respect to the 101 rejection have been fully considered but they are not persuasive. Applicant argues on pages 9-11 that the claims are eligible under prong one because the claims cannot be performed in the human mind and require processor execution and cryptographic computation. The Examiner disagrees because the blockchain protocol that operates with a UTXO model functions identically to the claimed invention and the assets are not escrowed in the current bitcoin protocol, which has functioned in this manner since the inception of bitcoin. The claims are directed to processing transactions with specific rules (a UTXO model) instead of a more traditional account process that occurs with standard bank accounts, which is an abstract idea. See also Fortis which describes how UTXOs work. Claiming a transaction protocol implemented on a computer does not make the concept nonabstract and the Desjarins memo does not state that all subject matter containing a computer is eligible and the improvements the Applicant is arguing do not improve the functioning of the computer because the improvement is in the concept of processing transactions with a specific protocol, a UTXO model, implemented on a computer(s). Applicant argues on pages 11-13 that the claims are integrated into a practical application, specifically that the modifications to the blockchain ledger caused by the smart contract execution may be automatically replicated throughout the distributed network of blockchain peers through one or more consensus protocols. Currently, no mention of smart contracts is present in the claim limitations. Additionally, the claimed features recite the manner in which a UTXO model functions on all blockchain exchanges and the functionality is not improved by claiming the abstract idea implemented on a computer, which differs greatly from Desjardins and the machine learning improvements identified in the memo. Applicant argues on pages 13-14 that the claims recite significantly more than the abstract idea. As previously stated, the UTXO protocol implemented on the blockchain is the standard model used in bitcoin transactions since the inception of bitcoin and no improvement to blockchain transaction processing is realized by operating the standard on a computer or claimed more broadly for all blockchain transactions, not just bitcoin.
Applicant’s arguments, see page 14, filed 18 February 2026, with respect to the 112(b) rejection have been fully considered and are persuasive. The 112(b) rejection of 18 November 2025 has been withdrawn.
Applicant's arguments filed 18 February 2026 with respect to the 102 rejection have been fully considered but they are not persuasive. Applicant previously argued that the recursive cheque script was central to the claimed invention, but after amendments, no mention of the recursive cheque script remains in the claims. Applicant argues on pages 15-16 that the prior art fails to teach or disclose claiming a portion of the crypto assets and generating a new cheque script with a signature with a new amount comprising the remainder of the crypto assets. Pagani provides how UTXOs function including when a portion of the UTXO is claimed for a transaction and a portion remains “unclaimed” by recipient because it exceeds the amount owed in paragraph [0073] “Note that in UTXO-based transaction models, a given UTXO needs to be spent as a whole. It cannot “leave behind” a fraction of the amount defined in the UTXO as spent while another fraction is spent. However the amount from the UTXO can be split between multiple outputs of the next transaction. E.g. the amount defined in UTXO0 in Tx0 can be split between multiple UTXOs in Tx1. Hence if Alice does not want to give Bob all of the amount defined in UTXO0, she can use the remainder to give herself change in a second output of Tx1, or pay another party”.
Claim Rejections - 35 USC § 101
35 U.S.C. 101 reads as follows:
Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.
Claims 1, 3-8, 10-15, and 17-20 are rejected under 35 U.S.C. 101 because the claimed invention is directed to an abstract idea without significantly more. In the instant case, claim 8 is directed to a “method”.
Claim 8 is directed to the concept of “using rules to complete a transaction” which is grouped under “organizing human activity… fundamental economic practice (mitigating risk through transaction processing security), and commercial or sales activities (using rules to complete a transaction is similar to sales activities and business relations)” in prong one of step 2A (See MPEP 2106.04(a)(2)). Claim 8 recites receiving a cheque script with a signature from a drawer, generating an unspent transaction output (UTXO) satisfied by the cheque script and the signature from the drawer, transferring assets to the UTXO, wherein the crypto assets are not escrowed, executing the cheque script to claim a portion of the crypto assets for a payee, wherein executing the cheque script comprises executing script instructions that validate the signature, generating a new UTXO with a remainder of the assets, generating a new cheque script with a signature from the drawer and a new amount corresponding to the remainder of the assets, executing the new cheque script to claim a second portion of the assets for a second payee. Accordingly, the claim recites an abstract idea (See MPEP 2106.04(a)(2)).
This judicial exception is not integrated into a practical application because, when analyzed under prong two of step 2A (See MPEP 2106.04(d)), the additional elements of the claim such as a memory and a processor represent the use of a computer as a tool to perform an abstract idea and/or does no more than generally link the abstract idea to a particular field of use (MPEP 2106.05(f)&(h)). A crypto asset is an additional element but is merely a digital asset and considered generally linking the abstract idea to a technological environment, that of digital currency. Therefore, the additional elements do not integrate the abstract idea into a practical application as they do no more than represent a computer performing functions that correspond to (i.e. implement) the acts of using rules to complete a transaction. Additionally, the concept of a UTXO model is shown in the references of Pagani and Fortis as well as the Bitcoin whitepaper from Satoshi because Bitcoin has always operated under a UTXO model as opposed to an account model and the claims reflect the operation of this concept.
When analyzed under step 2B (See MPEP 2106.05), the claim does not include additional elements that are sufficient to amount to significantly more than the judicial exception itself. Viewed as a whole, the combination of elements recited in the claims merely describe the concept of using rules to complete a transaction using computer technology (e.g. a memory and processor). Therefore, the use of these additional elements does no more than employ a computer as a tool to automate and/or implement the abstract idea, which cannot provide significantly more than the abstract idea itself (MPEP 2106.05(I)(A)(f) & (h)).
Dependent claims 3-7, 10-14, 17-20 do not remedy the deficiencies of the independent claims and are rejected accordingly. The dependent claims further refine the abstract idea of the independent claims and do not integrate the abstract idea into a practical application In this case, all claims have been reviewed and are found to be substantially similar and linked to the same abstract idea (see Content Extraction and Transmission LLC v. Wells Fargo (Fed. Cir. 2014)).
Claim Rejections - 35 USC § 102
In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis (i.e., changing from AIA to pre-AIA ) for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status.
The following is a quotation of the appropriate paragraphs of 35 U.S.C. 102 that form the basis for the rejections under this section made in this Office action:
A person shall be entitled to a patent unless –
(a)(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.
Claim(s) 1, 3-6, 8, 10-13, 15, and 17-20 is/are rejected under 35 U.S.C. 102(a)(1) as being anticipated by Pagani US 2023/0196373.
As per claim 1: Pagani discloses a system comprising: a memory (¶ [0034]); and a processor in communication with the memory (¶ [0034]), the processor being configured to perform processes comprising: receiving a cheque script with a signature from a drawer (Fig 2, ¶¶ [0061]-[0071], unlocking script “203’, ‘202’; ¶¶ [0061]-[0073]; [0076]-[0078] generally discloses that inputs contain a signature and the script can be used to define any one or more conditions); generating an unspent transaction output (UTXO) satisfied by the cheque script and the signature from the drawer (Fig 2, ¶¶ [0061]-[0071], ‘203’); transferring crypto assets to the UTXO, wherein the crypto assets are not escrowed (Fig 2, ¶¶ [0061]-[0071] ‘203’ amount; the amount is claimable to by either party depending on the locking script specification); executing the cheque script to claim a portion of the crypto assets for a payee, wherein executing the cheque script comprises executing script instructions that validate the signature (Fig 2, ¶¶ [0061]-[0071] ‘203’ locking script locking to bob’ is claimable to bob; ). generating, based on the executing of the cheque script, a new UTXO with a remainder of the crypto assets, (Fig 2, ¶¶ [0061]-[0073], ‘203’ output, see also [0073] “Note that in UTXO-based transaction models, a given UTXO needs to be spent as a whole. It cannot “leave behind” a fraction of the amount defined in the UTXO as spent while another fraction is spent. However the amount from the UTXO can be split between multiple outputs of the next transaction. E.g. the amount defined in UTXO0 in Tx0 can be split between multiple UTXOs in Tx1. Hence if Alice does not want to give Bob all of the amount defined in UTXO0, she can use the remainder to give herself change in a second output of Tx1, or pay another party”), generating a new cheque script with a signature from the drawer and a new amount corresponding to the remainder of the crypto assets (Fig 2, ¶¶ [0061]-[0073] ‘optional further UTXOs’ based on the amount/remainder, [0073] [0073] “Note that in UTXO-based transaction models, a given UTXO needs to be spent as a whole. It cannot “leave behind” a fraction of the amount defined in the UTXO as spent while another fraction is spent. However the amount from the UTXO can be split between multiple outputs of the next transaction. E.g. the amount defined in UTXO0 in Tx0 can be split between multiple UTXOs in Tx1. Hence if Alice does not want to give Bob all of the amount defined in UTXO0, she can use the remainder to give herself change in a second output of Tx1, or pay another party”; ¶¶ [0061]-[0073]; [0076]-[0078] generally discloses that inputs contain a signature and the script can be used to define any one or more conditions); executing the new cheque script to claim a second portion of the crypto assets for a second payee (Fig 2, ¶¶ [0061]-[0073]; [0076]-[0078] generally discloses that inputs contain a signature and the script can be used to define any one or more conditions, see also [0073] “Note that in UTXO-based transaction models, a given UTXO needs to be spent as a whole. It cannot “leave behind” a fraction of the amount defined in the UTXO as spent while another fraction is spent. However the amount from the UTXO can be split between multiple outputs of the next transaction. E.g. the amount defined in UTXO0 in Tx0 can be split between multiple UTXOs in Tx1. Hence if Alice does not want to give Bob all of the amount defined in UTXO0, she can use the remainder to give herself change in a second output of Tx1, or pay another party”).
As per claim 3: Pagani further discloses the system of claim 1, wherein the execution of the script assigns the new UTXO to the drawer (Fig 2, ¶¶ [0061]-[0071]).
As per claim 4: Pagani further discloses the system of claim 1, further comprising: generating an approved list of UTXOs (¶¶ [0174], Figs 2 & 10); and validating balances of inputs verses the approved list of UTXOs (¶¶ [0007], [0055]-[0056], [0075], Fig 2).
As per claim 5: Pagani further discloses the system of claim 1, further comprising: appending UTXO with amount of crypto assets that may be claimed by the cheque script (Fig 2, ¶¶ [0061]-[0073], [0075]).
As per claim 6: Pagani further discloses the system of claim 1, further comprising: verifying that the cheque script contains an approved random serial number, wherein the cheque script was generated with the approved random serial number and wherein the cheque script includes the approved random serial number to prevent multiple claims of a single cheque (¶¶ [0065]-[0067], see also ¶¶ [0061]-[0073]; [0076]-[0078] generally discloses that inputs contain a signature and the script can be used to define any one or more conditions as well as the public key which can be a random serial number in this instance; a header in blockchain also serves this function, see [0062]).As per claims 8-13 and 15-20: Claims 8-13 and 15-20 are rejected under the rationales of claims 1-6, respectively.
Claim Rejections - 35 USC § 103
In the event the determination of the status of the application as subject to AIA 35 U.S.C. 102 and 103 (or as subject to pre-AIA 35 U.S.C. 102 and 103) is incorrect, any correction of the statutory basis (i.e., changing from AIA to pre-AIA ) for the rejection will not be considered a new ground of rejection if the prior art relied upon, and the rationale supporting the rejection, would be the same under either status.
Claim(s) 7 and 14 is/are rejected under 35 U.S.C. 103 as being unpatentable over Pagani US 2023/0196373 in view of Buchanan “Chameleon Hashes” Dec 22, 2022, https://medium.com/asecuritysite-when-bob-met-alice/chameleon-hashes-c9e969a91ccb (herein Buchanan).
As per claims 7 and 14: Pagani fails to explicitly disclose but Buchanan does disclose the system of claim 6, the reconstruction further comprising: generating a chameleon public key and a secret trapdoor belonging to the chameleon public key (pp. 4-5); hashing, based on the chameleon public key and a random value, the cheque script with a blank amount for the crypto asset to generate a chameleon hash (pp. 4-5);
determining, using the secret trapdoor and the chameleon hash, a collision for a new cheque amount (pp. 4-5); and
hashing, based on the chameleon public key and the collision, the cheque script with the new amount (pp. 4-5).
It would have been obvious to one of ordinary skill in the art before the effective filing date to include chameleon hashing as taught in Buchanan in Pagani since the claimed invention is merely a combination of old elements, and in combination each element merely would have performed the same function as it did separately, and one of ordinary skill in the art would have recognized that the results of the combination were predictable. Buchanan is in the art of blockchain security and it would have been obvious to a person skilled in the art to combine the art of Pagani with Buchanan to improve the security and hashing protocols of Pagani.
Conclusion
The prior art made of record and not relied upon is considered pertinent to applicant's disclosure. Higashikado US 2023/0205762 Rand US 2024/0095692
Fortis “What is UTXO management?” June 6, 2022; https://fortris.com/blog/utxo-management accessed 6/6/2025
Applicant's amendment necessitated the new ground(s) of rejection presented in this Office action. Accordingly, THIS ACTION IS MADE FINAL. See MPEP § 706.07(a). Applicant is reminded of the extension of time policy as set forth in 37 CFR 1.136(a).
A shortened statutory period for reply to this final action is set to expire THREE MONTHS from the mailing date of this action. In the event a first reply is filed within TWO MONTHS of the mailing date of this final action and the advisory action is not mailed until after the end of the THREE-MONTH shortened statutory period, then the shortened statutory period will expire on the date the advisory action is mailed, and any nonprovisional extension fee (37 CFR 1.17(a)) pursuant to 37 CFR 1.136(a) will be calculated from the mailing date of the advisory action. In no event, however, will the statutory period for reply expire later than SIX MONTHS from the mailing date of this final action.
Any inquiry concerning this communication or earlier communications from the examiner should be directed to DAVID P SHARVIN whose telephone number is (571)272-9863. The examiner can normally be reached M-F 9 am - 5 pm EST.
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/DAVID P SHARVIN/Primary Examiner, Art Unit 3692