Datavault AI (NASDAQ: DVLT) announced that the U.S. Patent and Trademark Office has issued a Notice of Allowance for all 24 claims in its patent application covering blockchain-based methods and systems designed to detect and mitigate naked and excessive short selling through tokenized dividend distribution. The allowed claims include technologies for issuing digital dividend tokens on a distributed ledger, reconciling token issuance with reported share positions to identify settlement discrepancies, automating settlement and share recalls, supporting CUSIP reclassification, and providing real-time reporting and audit capabilities.
This intellectual property expands Datavault AI's blockchain and tokenization portfolio while creating potential licensing opportunities for exchanges, transfer agents, broker-dealers, custodians, issuers and digital asset platforms. The patent addresses a critical market integrity issue: naked short selling, which occurs when an investor sells shares they have not yet borrowed or secured, potentially driving down stock prices and undermining investor confidence. By leveraging blockchain's immutable ledger, Datavault AI's technology can track share ownership and dividend distributions in real time, flagging discrepancies that indicate short selling abuses.
The significance of this patent extends beyond Datavault AI's immediate business prospects. Regulatory bodies, including the SEC, have long sought effective tools to combat naked short selling, which can exacerbate market volatility and harm retail investors. If adopted by market participants, this technology could enhance transparency and fairness in securities lending and settlement processes. The patent also aligns with growing interest in tokenized assets and decentralized finance (DeFi) solutions for traditional markets.
Datavault AI's platform serves multiple industries, including high-performance computing software licensing for sports & entertainment, events & venues, biotech, education, fintech, real estate, healthcare, and energy. The company's Information Data Exchange enables Digital Twins and the licensing of name, image and likeness by securely attaching physical real-world objects to immutable metadata.
For more details, the full press release is available at https://ibn.fm/Ce5bf. Additional information about Datavault AI can be found at https://dvlt.ai.
