Today we’re going to introduce InvArch, a very interesting project which has a chance to become the standard for decentralized development and managing intellectual property. InvArch comes in two flavours: 1. a blockchain network that aims to become a Polkadot parachain and 2. a cross-chain IP Pallet Module using the cross-consensus message format (XCM). How does the Polkadot ecosystem benefit from having InvArch as a parachain and from its Pallet Module integration? It lays the foundation for many commercial use cases, such as commercial libraries for blockchain development, paid multimedia on the blockchain, and most excitingly, the new ways to collaborate on decentralized projects. Also, it features IP Staking, rewards for IP creators and dapp developers and many more.

They are launching in Q1 2022 and they plan to become a Polkadot parachain in Q2 2022. As this project is fairly new, it doesn’t have much coverage yet, however it has a strong dev community around it. We would like to participate in introducing it to the larger Polkadot community and show all its bright sides. Here we’re going to cover its architecture, use cases, VARCH token, team and future roadmap, so you would be able to fully understand its importance as the first platform for managing intellectual property on Polkadot.

InvArch is the result of 4 long years of working on the idea of creating a framework for connecting intellectual property and the tools to use it. Back in 2017, when everyone was dreaming about tokenizing and putting every aspect of human interactions on blockchain, the technology actually wasn’t ready for that. Various blockchain platforms for various IP-related purposes were launching on Ethereum: managing music copyrights, storing important documents, rewarding creators for their ideas and work.

All these platforms went into oblivion because they had a very narrow scope and the cost of Ethereum gas fees was exorbitant for any real usage even then.

Taking all these problems into consideration, InvArch founder Dakota Barnett developed the idea of a universal IP-management protocol and released the first draft of the project’s whitepaper in August 2021, when Polkadot ecosystem was already established, and assembled a team of professionals, together with Mindaugas Savickas (head of marketing), Kresna Sucandra (lead Substrate developer) and Gabriel Facco de Arruda (senior Rust developer). A bit later Bruno Škvorc (RMRK founder) joined them as technical advisor, followed by Sonja Prstec (Legal Counsel for Web3 Foundation, NEAR), Rainald Koitz (IP Management Lawyer), and Marvin Tong (Co-founder, Phala).

The team has strong expertise in legal IP management, a large community (more than 10k members on Discord) and the backing of the Web3 Foundation. They received a Web3 grant, and recently they closed the seed round with a $25m valuation for 7% of the token supply. The list of their VC is going to be published soon.

What is InvArch in a nutshell? A protocol to tokenize any ideas in the form of NFTs and fractionalize their ownership between all contributors in a secure blockchain environment. Ideas won’t get lost, because they will be stored on an immutable ledger, and they are protected by a plagiarism-detection system.

The protocol has several main components:

1. The Polkadot relay chain, which secures InvArch.

2. InvArch parachain, used for minting all new IP files and checking them for plagiarism, is also used for staking and governance.

3. A cross-chain IP Pallet Module, which essentially does the same as the main parachain, except the plagiarism verification, still handled by the parachain.

The InvArch parachain is a Substrate-based blockchain. All operations on the blockchain are performed by collator nodes that produce blocks, send them for verification to Relay chain validators and process all queries received from InvArch users. Collator nodes are chosen by nominators which have to stake their VARCH tokens and vote for a certain collator. Collators and nominators receive rewards for their participation, as well as the owners of intellectual property sets and the owners of decentralized applications running on the network. We’ll review all this in the tokenomics section.

The main units of the InvArch ecosystem are the following assets:

1. Intellectual Property Files (IPF). Each IPF is essentially an NFT that contains a predetermined amount of data fields with an idea or a link to a file with the necessary information, such as designs, code, media files. All IP files are stored on IPFS infrastructure, provided by an off-chain storage solution (such as Crust). After the upload, a canonical version gets mapped to the token and gets added to the IP database. Every new added IP gets checked and compared to the already existing IP on the blockchain. Even the alpha version will have reverse image search and plagiarism detecting mechanisms to ensure that nobody will steal IP from other users.

2. IP Sets. Every IP set is a product idea or implementation, consisting of one or many IP Files that describe or contain that idea. It can be a code library, music album, a gallery of paintings, the blueprints of a new smartphone, a smart contract or a whole dapp, etc. It will also be possible to organize several IP sets into bigger IP sets, creating a nested structure, which will be extremely useful for large decentralized projects with many participants and teams. It will also be possible to use the same IP File in multiple IP Sets.

3. Intellectual Property Token (IPT). This type of token confirms the ownership or other types of rights over an IP Set, and it can be divided among multiple addresses or owners. Since InvArch integrated Parity’s pallet_assets as a standard module for minting tokens, IPT tokens will be completely programmable, and creators of IP Sets will be able to define the utility and the use case for IP Tokens. The number of IP Tokens for each IP Set is defined by its creator, but it can be changed later by IPT holders via voting.

For better understanding, we can compare these types of assets to those, already familiar to our readers. As we know, an IP File is an NFT. Then it’s logical that an IP Set is an NFT collection, similar to collections that can be found on OpenSea (but better). But what can we compare IP Token with? The answer is simple. Imagine that every IP Set is a separate decentralized project that has its own native utility tokens. Holders of these tokens can utilize them for whatever purpose the tokens are programmed for.

The list of possible applications is pretty diverse:

• Rights to royalty claims

• Access rights to linked IPFs

• Governance tokens for projects

• Voting weight in DAOs

• Currency of IP-based launched dapps

If somebody has an idea of a startup developing a cheap lithium battery, she can create blueprints for it, describe the principles of this idea in a doc and add the report about the research that led to this idea. The 3 files will become 3 IP Files which will be merged into one IP Set. Then she can create IPTs which will serve as the proof of ownership or other types of ownership (governance or royalty rights etc.) for this project.

Every developer will be able to deploy a dapp, using InvArch custom pallet for the creation of smart contract IP Sets. This developer has to provide the code for deployment and a list of accounts and their respective ownership token amounts. Before deploying the code as a dapp, the pallet will mint the code as IPFs, create the IPS and distribute IPTs. If the accounts are not specified, 100% of IPTs will belong to the address initiating the deployment, but this can be dynamically changed after the fact.

So InvArch is basically the network that hosts projects’ ideas and gives them the opportunity to create tokens before launching the project, and even get some funding for development. However, it covers the full cycle of the project’s life, from the idea to deployment, and applies the same principles to dapps. Dapp developers have a chance to receive rewards in the network’s native tokens as well. Now, speaking about native tokens, it’s time to discuss tokenomics.

The native token of InvArch is VARCH. It will be utilized for many purposes, such as paying transaction fees, participating in on-chain governance, minting IP Sets, staking and rewarding developers and IP owners. The VARCH token generation event (TGE) is going to happen in December 2021, on Statemint. As soon as Statemint will connect to Polkadot as the common-good Parachain, which is expected to happen in December, InvArch will announce the TGE date.

Metrics:

Token: VARCH

Type: Utility, Governance, Staking

Max supply: 1 billion

Allocation for the crowdloans: 20% of the total token supply

It’s important to note that this 20% is allocated for a parachain lease during the first 2 years of the project’s life. The exact reward for the first InvArch parachain auction is not announced yet. The project has a sustainable economic model to be able to secure the slot for 2 years and even further, refilling its treasury with the income from network fees.

As we already mentioned, users pay fees for transactions, smart contract execution and creation of IP Files and IP Sets. Here comes one of the most interesting parts of InvArch incentives for its users. 35% of all network fees goes to IP Set owners. It doesn’t matter what kind of an IP Set it is, a music album, a smart contract, an idea or a dapp, their owners will be rewarded based on VARCH stakers votes via sub-staking.

What is sub-staking?

1. It’s a way to support a project by voting for an IP Set prior to delegating VARCH tokens to a collator. This voting is done to determine the proportionate allocations of IP staking rewards for accounts with stakeable IP Sets.

2. Alternatively, users will be able to choose to divert a portion of their staking rewards to an IP Set in exchange for a portion of that IP Set’s IPTs. Every project will have a predefined cap for this option, for example, “X% IPT in exchange for Y VARCH in fees”, so when it reaches a limit, this option will be unavailable.

IP Staking rewards will incentivize people to launch their projects on InvArch, because a) it will be a viable way to get funding for an interesting idea, b) developers will get rewards for building useful dapps, c) users will be able to get a share in their favourite projects at early stages, and for developers, it will be an opportunity to fully decentralize their projects.

It will be similar to dapp staking on Shiden, but a bit more advanced, because the fractionalized ownership model allows distributing rewards among all owners of an IP Set and gives the opportunity to distribute a portion of IPTs to stakers. Because of that, over time, the network will also become a hub for various dapps which will benefit from launching on InvArch.

40% of the network fees go to collators. 20% of the remaining network fees will go to the on-chain treasury. The allocation of these treasury funds will be delegated to an on-chain council which will work in a similar manner to the Kusama council. These funds will be spent on supporting InvArch-based projects and initiatives from the community members. The council members will be elected by VARCH holders.

The remaining token allocations can be seen in the graphic below. The seed round is over, the strategic round is TBA.

There’s only one thing left unexplained about tokenomics, what are these InvArch module integrations with an allocation of 10%? We’ll answer that.

InvArch Pallet Module

In the architecture chapter, we’ve already mentioned this module. It’s time to discuss it in detail. The cross-chain IP Pallet Module is the way to expand the functionality of IP minting across the whole Polkadot ecosystem. This Substrate-based module could be integrated into any parachain to get all benefits of the powerful system of InvArch IP Management. How does it work?

1. Any user will be able to mint IP Files on another parachain with IP Module integration.

2. When IP is minted, a record of the IP data will be sent to InvArch parachain. It will be achieved using lateral XCM transfers, a cross-chain messaging protocol, one of the defining features of the Polkadot relay.

3. The data will be indexed with help from one of the index providers and checked for plagiarism against other IPFs in the database. If no match is found, then it will receive a “verified” status. If a match or potential match is found, this IP gets a “flagged” or “caution” status.

4. This status then gets sent back to its issuer on another parachain.

To spur adoption and provide some incentives to other parachains to integrate the IP Pallet Module, InvArch will take a totally new approach. They will allocate 10% of the total supply, 100 million VARCH tokens, towards IP Module Integrations. These funds will be distributed among 10 first parachains that integrate the module, each of them will get 1% of the supply. VARCH tokens will be airdropped equally and directly among the wallet addresses of each integrated Parachain’s token holders. Thus it will make VARCH one of the most widely distributed tokens in the Polkadot ecosystem and will increase awareness of other communities about the project.

InvArch provides all necessary tools for devs. EVM support is already integrated, so all Solidity developers will be able to build dapps on InvArch with no requirement to learn anything new. WASM support will also be available at the beginning of 2022, before the mainnet.

Among other features are programmable tokens, oracles and integration with a decentralized Polkadot-based KYC platform.

Among the use cases that we hope to see on InvArch:

1. Incentivized Open-source Collaboration: An example includes a music application where artists could mint their music files and make them available for other artists to implement or sample, in exchange for a portion of IPTs in exchange for their work being used. This would provide the original artist with rights to royalty claims over any and all works by other artists that incorporate their music (think, beats) in them.

2. Incentivized Open-source Collaboration: Imagine modules of code. These modules could be combined into IP Sets or standalone IPF. Whenever a project or developer uses another developer’s module(s), they could provide a portion of IPTs over their project in exchange for using another developer’s modules. Then, if that application were to go on to produce revenue, the developer whose module(s) were used would receive a share of those future profits.

3. Enterprise IP Management: No matter how different the two companies are, and regardless of the IP management application of their preference, as long as these applications are built using the InvArch protocol, the digital IP assets existing among them will be interoperable throughout those applications. These streamlines the process of multi-enterprise IP management and collaboration.

4. Decentralized & Incentivized Education: Entire education lectures can be minted into IP Files and combined as IP Sets in order to form entire courses and even entire education systems. IP Tokens could be programmed to be minted upon contribution to a course or system, as well as freely distributed to its participants. This mechanism could allow for community-governed education systems.

5. iDEX (IPOwnership DEX): Entire marketplaces and decentralized exchanges could be created in order to provide lucrative mechanisms for IP fundraising. Whether a simple DEX for trading IP Tokens of certain projects, or even marketplaces for fractional ownership, the financial barrier to opportunity is lowered for interested parties, and ways to fuel innovation are increased for developers and founders.

InvArch offers a whole new approach to working on projects and managing intellectual property. By adopting this approach, decentralized communities of developers will be able to work on projects and contribute without signing any paper contracts, but still getting revenue afterwards if their projects succeed. Engineers and researchers will get a tool to upload and timestamp their work for sharing with partners, getting rid of a problem receiving a patent for every iteration. Startup founders will get access to fundraising for their brilliant ideas. Music and video creators will get an opportunity to collaborate on projects and claim their royalties. The number of possible use cases is very large.

Conclusion

InvArch is a very promising project with many revolutionary features. It’s the first blockchain for managing IP rights, but in addition, it has well-thought tokenomics, staking and governance, a new model of rewards for IP owners and dapp developers, EVM and WASM support, decentralized KYC integration and even its own Substrate pallet module. The project has a large developer community and actively grows its Ambassador program (you can find more details here). We believe in InvArch goals and future, and we’ll continue to provide you with new information about its development.

Stay tuned!

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