Blockchain is the technology behind infamous Bitcoin and provides a structure for dispute resolution with the help of smart contracts. The technology aims to establish an anonymous and decentralized mechanism without any state oversight or intermediary for transactions. Blockchain works on a decentralized network creating an immutable record of transactions. A smart contract is a self-executing software program that automatically performs a function. Once the conditions are met, the contract enforces itself without any additional step. The blockchain dispute resolution (BDR) platforms offer services for disputes arising out of blockchain and smart contract transactions or for traditional disputes that are not related to blockchain transactions. Each of the platforms provides untraditional mechanisms for adjudication that are also different from each other, creating an unorganized and unregulated environment. The platforms do not comply with the accustomed principles of alternative dispute resolution (ADR) and online dispute resolution (ODR) mechanisms raising the question of validity and legitimacy of the platforms and the need for regulation. The article aims to act as a brief introduction to some of these platforms and identifies major issues with BDR when compared to the established dispute resolution procedures. It briefly explains the blockchain and smart contracts with some examples on their alternative applications and then introduces BDR platforms. The article discusses concerns about BDR in light of ADR and ODR principles. It points out main issues following up the comparison of different mechanisms and tries to provide a perspective to find answers with discussion of possible solutions. Finally, the article suggests that the best way forward is to utilize BDR for supplementing ODR and ADR. If regulation is found absolutely necessary, then soft law instruments should be the first step in this respect.
The current legal uncertainty surrounding blockchain technology can discourage innovators from implementing new blockchain applications. Consequently, it can limitthe development ofthe technology and, ultimately, hinderthe growth ofthis new market. Therefore,this article aims to highlight and address, from a practical standpoint, the prominent legal challenges faced by innovators. The main technical components and applications of blockchain technology – such as crypto-assets, distributed ledgers, and smart contracts – are used as reference points for the analysis. First, the article classifies crypto-assets and specifies (1) when they fall within the scope of banking and finance regulation; and (2) when they fall within the scope ofthe MiCa Regulation proposal (also describing its principles and functioning). Secondly, it investigates the evidential value of distributed ledgers, assesses how they could be exploited in private law matters, and examines the recent proposal of amendment to the eIDAS Regulation. Lastly, it clarifies under which conditions a smart contract can be legally binding and the practical consequences.
The article is devoted to the features of protection the weak party in the situation when the parties to the banking agreement use the “smart contract” technology from the point of view of Russian and foreign doctrine. The author proposes particular changes and additions to the current regulation and the established judicial practice, while the general principles of legislation remain unchanged.
Introduction: smart contracts helps solve the problems of intercorporate interaction by providing the possibility of fast and secure automatic transactions. However, the development and application of this digital technology are prevented by a number of factors. Their analysis from the viewpoint of diffusion of innovation theory will allow developing a strategy for managing the growth of this technology. Objectives: to determine the state policy directions in the field of regulation and use of smart contracts based on the systematization of factors that prevent their wide diffusion, and assessment of the influence of key actors associated with the development of this technology. Methods: meta-analysis of studies, survey of 170 Russian companies, comparative analysis, statics and dynamics method, formal-logical method. Results: the article defines the position of smart contracts on the diffusion curve for Russian companies, and systematizes the factors that prevent the wide diffusion of smart contracts by taking into account the characteristics of innovations. Further, the influence of key actors on the diffusion process has been assessed. The state policy directions in the field of regulation and use of smart contracts are determined. Conclusions: in Russia, the only users of smart contracts tend to be innovators and early adopters, while the key factors for diffusion are the characteristics of relative advantage, organizational and institutional compatibility, and risks related to using the technology. The average level of influence of technology developers, the regulator (state authorities) and companies on the diffusion process is approximately the same. The priorities of state policy in the field of regulation and use of smart contracts should be to provide conditions for organizational and institutional compatibility of innovation, reduce the legal risks of using this digital technology, and train personnel.
The smart contract is a computer program that facilitates the automation of processes related to human bargaining. e topic is receiving some attention in doctrine perhaps by virtue of its curious name and perhaps because the concept is closely linked to the idea of the automation of law, a hotly debated topic. Having said that, it is not clear whether this innovation will be fully applied in the next few years in the field of consumer mass bargaining. On the one hand, the issue lends itself to an initial reflection on the evolution of the standardisation of consumer contracts in the global and digital economy. Our hypothesises is the smart contract constitutes a form of 'extreme standardisation' of consumer contracts, or rather, of their total or partial execution. is form is immediately very particular and critical for the interpreter, since it is intimately linked to the technological medium (i.e. Blockchain technology) and straddles the digital world and the real one. On the other hand, the paper considers whether the automation process, which is fully realised by the smart contract after the advent of electronic commerce and digital platforms, will be an opportunity to reduce the costs of justice in consumer disputes, or, on the contrary, will constitute a risk to consumer freedoms.
The article examines the economic and legal nature of cryptocurrency as an object of civil rights. The article analyzes the current problems of the civil law mechanism for fulfilling obligations in the sphere of digital rights turnover. The system of characteristic features of the cryptocurrency is revealed. To clarify and integrate doctrinal, legislative and law enforcement approaches, the author proposes a definition of cryptocurrency based on its qualifying features. The author defines cryptocurrency as a transferable complex thing within a given specific digital system, which is characterized by both material signs of money, currency values and information, and legally significant qualities of the property, digital and intellectual rights, and intangible benefits (business reputation). Currently, it is necessary to sыolve the problem with the lack of theoretical, legislative, and law enforcement approach to the concept of cryptocurrency and the systematization of its qualifying features. The legal definition of cryptocurrency will serve as a methodological basis for the effective legal regulation of relations both in the specialized market of digital financial instruments and relations in the rapidly developing sphere of digital rights, which is necessary for economic growth and serves as an institutional basis for the digital economy and the state.
The purpose of the article was to study the approaches of foreign countries inrelationtothelegalregulation and circulation of cryptocurrencies. To achieve this goal, the method of chronological researchwasused, during which an analysis of the legislative framework of a number of foreign countries, their methodologyfor developing laws, policies and legal frameworks in relation to cryptocurrencies was carriedout. Thepeculiarities of the development of the ecosystem of cryptocurrencies and startups in the use of cryptocurrenciesontheterritory of a particular country, as well as the relationships that arise between intermediaries, startupsandinvestors in these countries, are studied. The opinions of experts, politicians, scientists concerningthefutureprospectsof cryptocurrencies in the legal field of foreign countries are noted. Complementing this withanassessment oftherisks and prospects in the use and integration of such a new "technological phenomenon". It is concludedthatcryptocurrencies will be able to become part of the global system if aspects of the licensingactivitiesof exchanges, as well as the administration, issuance of virtual currencies, storage and management of thirdpartiesbecomeacoordinated and controlled process.
The paper focuses on the legislative changes from 2021 that the Law on Digital Assets introduced into the legal system of the Republic of Serbia and contextualizes the amendments from the perspective of existing practice. Introductory part evaluates the issue of whether blockchain technology can secure trust and safety in the transactions that are executed via Internet by parties from all over the world, as well as reasons that created the regulatory framework for values that are transferred over distributed ledger technologies infrastructures. Main part of the paper examines in detail the legislative solutions within the Law on Digital Assets as well as key exceptions and terms and their impact on the local economy. The section is followed by an overview of the draft legislation in EU in the field as well as how it may impact Serbian economy as a third country. Aside from concluding remarks on legislative changes domestically, the paper outlines potential upcoming challenges related to blockchain and instruments that may require a different approach in regulation.
The conclusion of smart contracts is placed on the blockchain platform due to the special features of this platform, including the two features of transparency and decriminalization. After being completed on the blockchain network, these contracts' transparency feature enables the public to observe and offer them. In this case, all the people who have access to this platform have the possibility of knowing what was transferred by whom to whom, and this not only prevents the occurrence of many related lawsuits but also many crimes related to property.
The issues of sustainable development of territories are increasingly coming into the field of vision of scientists and practitioners. The institutional framework of the region's infrastructure implements the principles of sustainability and adaptability. The use of smart contracts can facilitate strengthening of the communication stability between subsystems and elements of the region's economy. The practice of using smart contracts in various spheres of activity (banking sector, insurance, transportation, delivery of goods, government services, etc.) demonstrates their ability to maintain the intended development trajectory, despite the influence of external factors. The possibilities of using smart contracts in the regional economy include holding a vote of citizens on a particular vital issue; organization of cadastral registers and standard electronic documents. Also they include carrying out initiatives to register companies and support small and medium-sized businesses; introduction of a mechanism for tracking shares and their financial support; management of communication between business entities and individuals in terms of compliance with environmental standards, including the provision of regulatory and reference documentation. We are not talking about the formalization of the entire economic system with smart contracts and the creation of a "digital region". The formulation of the research problem is associated with the use of smart contracts as a connecting link in the institutional framework of the regional economy, contributing to overcoming the state of instability of infrastructure in the digital economy. In recent years, support for the sustainable development of the territory has become an urgent agenda for the development of many institutions. The principles of sustainable development, or ESG -Environmental, Social, Governance, are formulated, implying a responsible approach to environmental issues, social and corporate cooperation. Obviously, in order to work according to ESG principles, Russian regions need institutional transformation. Digital tools (smart contracts, block chain, cloud technologies and artificial intelligence) create additional opportunities for the implementation of the ESG agenda. The sequence of actions is the following: analysis of the goals achieved in this direction on the basis of digital technology tools; development of a regional ESG policy (a concept for the development of a territory based on ESG principles) and informing the public (publication of the concept in the public domain) about the directions and priorities of its implementation. Then it is as follows creation of an institutional basis for the implementation of regional ESG-policy; defining the objectives of institutional support; formation of measures for the implementation of regional ESG-policy, including time limits and responsibility for their implementation.
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Economic and Technological Systems Analysis
Digitalization and Economic Development in Agriculture
Lately, more and more attention has been paid to the phenomenon of smart-contracts (SC) in legal research. The SCs have already found their application in many aspects of society life and are particularly common in the regulation of legal relations in the area of automated financial services, which may include lending, mortgages, insurance, etc., as well as in public services, including various types of voting, elections, document management, supply and storage. The practical dissemination of SCs is carried out without a conceptual approach in the legal regulation of this object, but also without a unified terminology. The science begins developing approaches to study of the legal nature of SCs and offers options for their legal regulation have been proposed, each of those, of course, has its benefits and disadvantages, which is explained by the multifaceted nature of this phenomenon. First of all, it means a qualitatively new level of functioning of a smart-contract where the technical component overlays on traditional types of legal relations. Both authors of the article used scientific methods such as analysis, synthesis, comparison, induction and deduction. Special attention is paid to different options for understanding the legal nature of smart contracts, proposed by European and domestic scientists.
Introduction: the article is devoted to the analysis of legal regulation of smart contracts, the concept, content, and scope of their application. The author analyzes in detail foreign expe- rience of using smart contracts and suggests possible options for expanding the application area. The article also has a separate section that looks at smart contracts as compared with traditional institutions of civil law. Smart contracts are expected to find application in almost all areas of life in the future. As is often the case with new technologies, the use of smart con- tracts raises a number of civil law issues. Blockchain technology makes it possible not only to create new means of payment but also to autonomously manage almost any process. It can be used for individual contracts and even for the creation of autonomous decentralized systems. Purpose: to provide an insight into the institution of smart contracts and define their role in civ- il law. Methods: empirical methods of comparison, description, interpretation; theoretical me- thods of formal and dialectical logic; special scientific methods such as the legal-dogmatic me- thod, the methods of interpretation of legal norms and comparative legal research. Results: smart contracts are computer programs that perform legally significant actions according to predetermined algorithms set out in the form of a so-called program code. In practice, they are especially important in connection with the development of blockchain technology or (more generally) distributed ledger technology. Conclusions: the term ‘smart contract’ was defined by Nick Szabo in the 1990s as a sequence of commands represented in digital form, including transaction protocols that execute these agreements. Thus, smart contracts formulate rules and sanctions for agreements and execute them automatically. These are not necessarily contracts in the legal sense, but they are capable of controlling, tracking, and documenting legally signif- icant actions. Smart contracts can also be implemented using traditional, for example, mechan- ical technologies (e.g. in a vending machine). However, blockchain and distributed ledger tech- nologies make it possible to implement incomparably more complex rules and enforcement me- chanisms and offer a decentralized environment with an integrated settlement system. From a legal point of view, smart contracts perform two functions. On the one hand, they serve as a functional equivalent of a contract since their technological code can identify the services to be exchanged as well as the conditions under which they must be provided. Being the normative order of the digital, this code formulates the program of obligations of the parties. It resembles the legal order of a contract, without necessarily coinciding with it. On the other hand, smart contracts serve as a tool for the execution of contracts – by controlling, monitoring, and docu- menting the exchange of services. They can also facilitate the execution of conventional con- tracts by translating their provisions into a technical code, verifying the occurrence of agreed- upon events, and enforcing contracts. Smart contracts are suitable for contractual relation- ships, for example, for processing payments or delivering goods without the participation of the parties and an intermediate step in the form of direct execution. Smart contracts are gaining more and more popularity, especially in the financial sector. In addition to the so-called token economy (cryptocurrencies, ICO, etc.), there are also discussed algorithmic ETFs, online plat- forms for loans or project financing. Another important area of application is sharing economy. From a legal point of view, smart contracts can either be the subject of a contractual agreement or generate it on their own. There is sometimes put forward a thesis under the motto ‘Code is law’ that smart contracts give rise to a largely autonomous legal system and/ or are not subject to applicable law. However, this appears to be an erroneous conclusion
The article is devoted to a topic of great scientific and practical importance in the modern context of creating a digital economy ecosystemб to the smart contract phenomenon. The article focuses on the foreign civilistic doctrine of the smart contract study. The main discussion questions about the legal and technological nature of the smart contract, the ways of its implementation in the current contract law of each country, the approaches of national legislators to solving this issue and the functional nature of the smart contract are considered. The main disputable problems are the legal and technological nature of the smart contract, the ways of its implementation in the current contract law of each country, the approaches of national legislators to solving this problem and about the functional nature of the smart contract. The article also involves a comparative legal aspect: it analyzes the approaches of the Russian legislator and representatives of the domestic legal doctrine to the smart contract place in the pandect system of Russian civil law in comparison with the foreign legal systems settlement of similar issues. It is noted that using the positive experience of the smart contracts legal regulation should be taken into account when creating and correcting the regulatory platform of the digital economy in the Russian Federation. The article evaluates the legal innovation of Part 2 of Article 309 of the Civil Code of the Russian Federation (RF CC). The description is given of the innovation developers positions given in the Explanatory Note to the relevant draft law; the investigation is performed on the technological terms used in the current version of the RF CC with regard to the electronic form of a deal and smart contract. In addition, the article raises the problem that is well known to the foreign legal doctrine: the problem of the computer code credibility and the distrust of the counterparties of each other. Attention is paid to the advantages of the smart contract, which are discussed by foreign legal scientists, as well as representatives of other related sciences. In the conclusion of the article, the main findings are given that demonstrate the authors’ view on the issues considered in the article.
Blockchain smart contracts are emerging research area among Industrial communities and academics. Blockchain enabled Smart contracts provide automatic processing, security in decentralized environment and removes the barrier of trusted third party. Insurance industry is one of the targeted areas for hackers, and takes more time for processing. The Insurance industry will change dramatically when integrating with Blockchain technology, with high degree of security, real time working and minimum processing cost. Writing smart contracts are very challenging task as Blockchain is secure itself, but sometimes blockchain enabled smart contracts leads to vulnerabilities, have to face scalability & privacy issues also. Authors gives overview of Hyperledger Fabric as it is standard platforms for implementing smart contracts for permissioned blockchain, and proposed a research framework for smart contracts use cases in insurance sector. Second, the technical and legal challenges, as well as the current research are discussed. This paper is aimed to provide guidance for future research in Blockchain smart contracts in insurance industry.