Smart contracts as a type of electronic contracts, their features and problems in the electronic circulation of civil law objects

Abstract

The article is devoted to the study of the features of smart contracts, which are a type of electronic contracts. Smart contracts, which are also called “smart contracts” (origin of the word “smart contract”), correspond to modern trends in digitalization and provide an effective mechanism for the implementation of business, financial and economic relations in a virtual environment. The following methods were used in the study: general logical, method of analysis and synthesis, formal-legal, comparative-legal, systemic. When comparing the so-called “technological” and legal approaches to understanding the concept of “smart contract”, the views of different groups of foreign and domestic scientists and researchers on the interpretation of this concept were analyzed. The principle of operation of a smart contract is considered on a specific example, while the way in which a smart contract operates in certain specific conditions is studied in detail and possible reasons for its failure to perform are analyzed. When analyzing the operation of smart contracts, their practical, technical, legislative problems and features were identified. Thus, the feature of immutability of a smart contract is its advantage because it excludes the intervention of the human factor. But the immutability of a smart contract is also its disadvantage because it makes it impossible to conclude additional agreements to a smart contract when certain circumstances change. Taking into account the study of the properties of a smart contract and an example of its operation, it can be stated that a smart contract can function only in a certain environment provided that the executable program code has direct and unlimited access to the objects of the smart contract. This creates integration problems of a smart contract with the objects of its operation. Thus, if the subject of a smart contract is real estate and in this regard the specified electronic contract requires notarial electronic certification and corresponding registration in the digital environment, then today in Ukraine there is an integration problem of electronic notarial certification of such contracts due to the absence and legislative uncertainty of the mechanism of electronic notarial certification and registration. Also relevant is the problem of smart contracts regarding payments under them in cryptocurrency, which also requires a legislative solution, since the legal status of cryptocurrency in Ukraine has not yet been established. Solving these problems in the future will allow for the wider use of smart contracts by their Ukrainian counterparties.