The law of cross-border insolvency is about where a company is. It has never had to ask legally what is being administered where an estate consists of cryptographic keys rather than factories or what happens when the controlling minds of a debtor are as mobile as the assets they control. In this paper, I argue that the recent cross-border insolvency reform in India, advanced by section 240C of the Insolvency and Bankruptcy Code (Amendment) Act, 2026 (an enabling provision, whose substantive rules remain undrafted), will fail a meaningful share of the insolvencies it is meant to resolve, unless those rules are built with digital assets affirmatively in mind.The argument proceeds in three movements. First, it traces the doctrine of "centre of main interests" through its foundational European and American case law, showing a registered-office presumption that holds up well against debtors who are not trying to defeat it, and considerably less well against those who are. Second, it compares how courts in New Zealand, the United States, and Japan have answered materially the same question, whether a depositor's cryptocurrency is trust property, contractually transferred estate property, or no property at all, and reached three different answers in insolvencies with nearly identical facts. Third, it reads recent failures, including the Indian exchange WazirX's restructuring before a foreign court with no domestic mechanism for India to participate, as variations on one structural pattern that neither doctrine was built to handle.The paper conclude by proposing some concrete provisions which we would suggest that the Central Government consider as it moves forward with the process of notifying the remaining rules under section 240C – specifically, these include a legislated default regime relating to customer deposits, a COMI presumption in relation to debtors who have no other registered office, and a mechanism which enables India to be heard if a foreign restructuring results in large numbers of Indian citizens being affected.
The legal nature of tokens, cryptographic assets recorded on distributed ledgers and capable of performing multiple economic functions simultaneously or successively, remains one of the most contested and consequential unresolved questions in contemporary financial law. The dominant regulatory response, principally the application of securities law analysis through the investment contract test established in SEC v W J Howey Co , has generated a body of case law characterised by inconsistent outcomes, pervasive uncertainty, and perverse incentives to structure token offerings so as to fall outside the regulatory perimeter. The property law, monetary law, and contractual rights frameworks each capture an important dimension of the problem, but none is adequate, standing alone, to provide a comprehensive and coherent account of the legal nature of tokens across the full range of contexts in which that question arises. This article advances the thesis that the persistent attempt to assign a fixed and singular legal nature to tokens is both theoretically unsatisfactory and practically counterproductive. It is theoretically unsatisfactory because it seeks a degree of ontological stability in an asset class whose defining characteristic is functional versatility; it is practically counterproductive because it produces regulatory arbitrage, legal uncertainty, and market fragmentation. The appropriate response, it is submitted, is a dynamic functional typology: a framework that determines the legal nature of a token by reference to the economic function it performs at any given moment in its lifecycle, payment, investment, access, governance, or representational, and that assigns legal consequences in property, contract, insolvency, and regulation accordingly. Drawing on doctrinal analysis, comparative law, and normative legal theory, the article establishes five economic functions as the organising categories of the framework, proposes four criteria for the identification of the operative function in any given case — the reasonable expectations of the acquirer, the observable economic characteristics of the token, the degree of decentralisation of the network, and the stage of the token's lifecycle — and demonstrates the framework's application to the principal categories of token and to the hardest contested cases, including non-fungible tokens, algorithmic stablecoins, decentralised autonomous organisations, hybrid tokens, and decentralised finance protocols. The comparative analysis examines the regulatory frameworks of the European Union (MiCA), the United States (the Howey test and the proposed FIT21 Act), the United Kingdom, Switzerland, Liechtenstein, Singapore, and Japan, demonstrating that the functional approach is not merely a theoretical construct but the direction in which the most sophisticated legislative initiatives are converging. The article culminates in the articulation of a five-stage Dynamic Classification Framework, comprising preliminary identification, function determination, consequence assignment, lifecycle monitoring, and reclassification, supported by a Dynamic Classification Matrix that maps the legal consequences of each operative function across property, insolvency, and regulatory dimensions. Two regulatory safe harbours are proposed: a transitional safe harbour for issuance-stage tokens and a decentralisation safe harbour for tokens that have achieved sufficient network decentralisation. The article further proposes a token register as the international harmonisation instrument through which the framework's outputs are made publicly accessible across jurisdictions. The framework is designed to be jurisdiction-neutral and compatible with the principal existing legislative architectures, including MiCA, MiFID II, the UNIDROIT Principles on Digital Assets and Private Law, and the UK Law Commission's recommended data object category. Note: A slightly shorter Spanish version is currently under review for the edited volume "Los bienes digitales", led by the PRIVATECH Observatory, Universidad Externado de Colombia.
Smart contracts, a revolutionary technology that offers a digital alternative to conventional contracts, are popular. Smart contracts also known as automated digital contracts are becoming common in various countries due to their efficiency and openness. Various national and global forums have agreed that smart contracts might alter contract enforcement and boost economic development in India. Given this, it’s crucial to understand the Indian Contract Act, (ICA) 1872 stance on smart contracts. ICA requires testing smart contracts for contractual validity before entering the uncharted seas of autonomous and anonymous digital contracting. This experiment raises many issues, especially given the law’s strict procedural structure. This article refutes the claim that smart contracts should be regulated by self-regulation. Rather author prefers a broad interpretation of substantive contractual law to harmonize smart contracts under the ICA, following common law’s flexibility. It is shown that smart contracts are built on the same principles as common law contracts and deepen our research in the framework of Indian law and precedent. Similar approaches from other countries support this perspective. Although many legislations require change, it is believed that a smart contract law is not needed. The paper concludes by proposing solutions to the potential obstacles that may arise due to present approach.
Abstract This article examines the integration of Decentralized Autonomous Organizations (DAOs) into the existing legal framework of the United Kingdom, proposing a novel legal entity model termed the Decentralized Autonomous Organization Limited Liability Partnership (DAOLLP). It explores the distinctive characteristics of DAOs, including their decentralized governance, reliance on smart contracts operating on blockchain and the challenges they face under current UK law and underscores the necessity for legal adaptations that accommodate these innovative structures. The suggested model seeks to provide legal personhood, limited liability protection and a framework for compliance with existing laws and regulations while maintaining the core principles of decentralization and transparency. By comparative analysis of legislative approaches towards DAOs in jurisdictions such as Wyoming, Vermont and Malta, this article promotes a proactive regulatory framework for DAOs that fosters innovation and positions the UK as a leader in blockchain governance.
The paper explores the transformation of legal concepts in the era of smart contracts, with a focus on rethinking responsibility and justice within a hybrid legal ontology. The purpose of the article is to develop the conceptual foundations of a hybrid legal ontology to analyze the transformation of responsibility and justice in the context of smart contracts, aiming to comprehend qualitatively new forms of legal reality that emerge at the intersection of human and algorithmic principles. The study adopts an interdisciplinary approach, integrating philosophical-legal analysis with elements of systems theory, critical algorithm theory, and post-phenomenological research on technology. The methodological framework is based on concepts of legal pluralism, agency theory, and approaches from analytical philosophy of law to the challenges of responsibility. It is argued that smart contracts establish a hybrid legal ontology in which traditional categories of individual responsibility are replaced by distributed forms of agency. The study identifies a fundamental contradiction between the algorithmic logic of procedural justice and human needs for substantive justice. It is established that restorative justice is incompatible with the deterministic execution of smart contracts. The conceptualization of legal pluralism in blockchain ecosystems is further advanced through the coexistence of diverse normative orders. The research findings contribute to the philosophical-legal theory of the digital age by conceptualizing hybrid ontology as a new form of legal existence, thereby enriching the understanding of agency, responsibility, and justice in the context of human- machine interaction. The results provide a theoretical basis for developing new regulatory mechanisms that account for the distributed nature of responsibility in blockchain systems, establishing ethical principles for designing fair algorithmic systems, and creating hybrid justice institutions. A conceptual vision of hybrid legal ontology is proposed as a theoretical framework for analyzing qualitatively new legal phenomena. The concept of distributed agency is substantiated to describe collective responsibility in decentralized systems. An approach to understanding algorithmic justice through the limitations of formal systems is suggested. The study highlights the need for developing specific mechanisms to operationalize hybrid legal ontology in regulatory practice, creating new institutional forms to implement distributed responsibility, and exploring possibilities for integrating restorative justice into algorithmic systems.
To explore the legal and philosophical implications of smart contracts, with a focus on their enforceability and the political significance of the “code as law” paradigm. This study adopts a narrative review approach using a descriptive analytical method to examine the intersection of law, technology, and political theory. Sources were selected from academic databases published between 2020 and 2024, encompassing legal scholarship, computer science literature, and political philosophy. Thematic analysis was used to synthesize key ideas related to legal enforceability, algorithmic governance, and the transformation of legal subjectivity in coded systems. The review highlights significant tensions between traditional legal norms and the deterministic nature of smart contracts. While smart contracts offer advantages in terms of automation and efficiency, they also lack the capacity to address ambiguity, context, and moral judgment. These contracts challenge core principles of legal theory, including consent, due process, and equitable remedies. Jurisdictions differ in their responses, ranging from proactive legal recognition to cautious regulatory experimentation. Hybrid models of enforcement and reliance on oracles demonstrate emerging attempts to bridge the gap between code and law. Smart contracts represent a disruptive force in the legal domain, necessitating critical reflection on the philosophical and institutional foundations of modern legal systems. Their adoption must be guided by a commitment to justice, democratic governance, and interdisciplinary oversight to ensure that legal innovation aligns with human values and ethical responsibility.
Georgios Birmpas, Philip Lazos, Evangelos Markakis, Paolo Penna
In this paper, we investigate the impact of reward schemes and committee sizes motivated by governance systems over blockchain communities. We introduce a model for elections with a binary outcome space where there is a ground truth (i.e., a "correct" outcome), and where stakeholders can only choose to delegate their voting power to a set of delegation representatives (DReps). Moreover, the effort (cost) invested by each DRep positively influences both (i) her ability to vote correctly and (ii) the total delegation that she attracts, thereby increasing her voting power. This model constitutes the natural counterpart of delegated proof-of-stake (PoS) protocols, where delegated stakes are used to elect the block builders. As a way to motivate the representatives to exert effort, a reward scheme can be used based on the delegation attracted by each DRep. We analyze both the game-theoretic aspects and the optimization counterpart of this model. Our primary focus is on selecting a committee that maximizes the probability of reaching the correct outcome, given a fixed monetary budget allocated for rewarding the delegates. Our findings provide insights into the design of effective reward mechanisms and optimal committee structures (i.e., how many DReps are enough) in these PoS-like governance systems.
Regulating cryptocurrency’s place in America’s most popular retirement savings vehicle generates thorny legal, ethical, and social justice dilemmas. Too little regulation could hurt those at highest risk of underfunded retirement. Too much could exacerbate existing racial, ethnic, and gender inequities. Though recent regulatory efforts suggest 401(k) administrators violate their fiduciary duty of care by offering cryptocurrency investment options to plan participants, the established fiduciary regime protects 401(k) plan participants from cryptocurrency risk while respecting their savings preferences. Yet, the current framework falls short of ethically and equitably serving all plan participants, particularly members of underserved communities— a problem largely unaddressed in academic, industry, or regulatory discourse. This Article demonstrates how regulators’ needlessly paternalistic approach toward cryptocurrency options could disproportionately impact minority retirement savings participation. Applying the existing fiduciary framework and practical mechanisms that plan fiduciaries currently use would minimize cryptocurrency risk to participants without rewriting the rules governing plan administration. This Article also proposes a novel, scientifically supported method by which fiduciaries should convey retirement planning information to improve retirement outcomes for all: via non-traditional media.
This note analyses the part on expropriation of the judgment of the International Court of Justice (ICJ, or the Court) in the case Islamic Republic of Iran v United States of America (Certain Iranian Assets).2 The case arose from various legislative and judicial measures taken by the United States against Iran that allegedly resulted in the breach of the United States’ obligations under the Treaty of Amity, Economic Relations, and Consular Rights (1955) (the Treaty of Amity).3 The ICJ found by 11:4 votes that the United States had violated the obligation under Article IV(2) of the Treaty of Amity that property of nationals or companies of the Contracting Parties ‘shall not be taken except for a public purpose, nor shall it be taken without the prompt payment of just compensation’. Four dissenting judges found that no taking had occurred. The Court found that no denial of justice had occurred. It stated that the Iranian entities had been able to contest the underlying measures, make submissions before US courts, lodge appeals and that there had been no ‘serious failure in the administration of justice amounting to a denial of justice’.4 The judgment raises two important questions in the context of an expropriation: what sort of illegality, if any, does it need to turn domestic court judgments implementing the amended US legislation into an expropriation and what is the role for regulatory powers in this context? The note commences with a review of the background of the dispute (Section II). It then addresses the judgment’s analysis (Section III) and proceeds to discuss two particular issues in the judgment in the context of expropriation, namely: expropriations involving domestic court judgments and regulatory powers (Section IV) before offering conclusions (Section V). The bilateral relationship between the United States and Iran has remained problematic ever since the 1979 Islamic Revolution. The United States considers Iran to be responsible for the 1983 bombing of the US military barracks in Beirut which led to the deaths of 241 US peacekeepers and injured many more and for supporting numerous terrorist acts against US nationals and the United States.5 In 1984, the United States declared Iran to be a ‘State sponsor of terrorism’ and inserted a ‘terrorism exception’ into its Foreign Sovereign Immunities Act (FSIA) in 1996.6 As a consequence, it was possible to successfully claim compensation for deaths and injuries resulting from terrorist acts sponsored by Iran or other States designated as ‘State sponsor of terrorism’.7 In 2002 the United States adopted section 201(a) of the Terrorism Risk Insurance Act (TRIA).8 This provision allows for the attachment of assets and execution of terrorism judgments for compensatory damages. This is possible against the assets of a State sponsor of terrorism and those of its agencies and instrumentalities, which have been blocked pursuant to a sanction regime. In 2008 the United States adopted section 1610(g) of the FSIA to enlarge the categories of assets that can be used for attachment and execution.9 In 2012, the US president issued Executive Order 13599. It blocked all assets of the government of Iran, including those of the Central Bank of Iran and of other Iranian financial institutions, where such assets were within United States territory or ‘within the possession or control of any United States person, including any foreign branch’.10 Furthermore, the United States adopted in 2012 the Iran Threat Reduction and Syria Human Rights Act. Section 502 of this act made assets of the Iranian Central Bank available for execution.11 As a consequence of these legislative and executive measures US courts have issued a number of default judgments and substantial damages judgments against the State of Iran and, in some cases, against Iranian State-owned entities. Further, the assets of Iran and of certain Iranian entities, including the Central Bank of Iran are subject to enforcement proceedings in various cases in the United States or abroad, or have already been distributed to judgment creditors.12 As a consequence, Iran sued the United States based on the compromissory clause in the 1955 Treaty of Amity. It alleged that among other provisions the United States had violated Article IV(2) which prohibits uncompensated expropriations. The United States only terminated the Treaty of Amity in October 2018 when the ICJ rendered its Order on Provisional Measures in the parallel 1955 Treaty of Amity case which is concerned with US sanctions.13 The United States objected to the jurisdiction of the ICJ and contested the unlawful expropriation claim on the ground that, inter alia, its actions were a legitimate exercise of its police powers. The United States invoked that they were aimed at providing victims of terrorist acts with the ability to obtain redress from the sponsors of those acts, including Iran.14 The United States’ jurisdictional objections were successful regarding the Iranian Central Bank. The ICJ decided that it does not qualify as ‘company’ under the Treaty of Amity. Therefore, a major part of the expropriation claim, namely the part concerning the assets of the Central Bank, was outside the jurisdiction of the ICJ.15 Concerning the rest, the Parties did not dispute that US courts had subjected the property and interests in property of Iranian companies to attachment and execution. Furthermore, there was agreement on the fact that such assets had been turned over or distributed to successful claimants in US court cases in which Iran was found liable. This happened without compensation for the affected Iranian companies.16 The ICJ’s analysis of the expropriation claim is brief (two pages). First, the ICJ states which assets are concerned.17 The United States objected against the inclusion of certain assets that were only distributed to the plaintiffs in US court cases after the termination of the Treaty of Amity.18 The ICJ decided that these funds could nevertheless be taken into consideration in the expropriation analysis since they were already affected by US court decisions pre-dating the termination of the Treaty of Amity.19 The Court declined to consider assets that Iran could not prove belonged to Iranian companies.20 It decided that it had to determine whether the attachment and execution of the property and interest in property constitute takings in violation of Article IV (2) of the Treaty of Amity.21 Pursuant to the second sentence of Article IV(2) of the 1955 Treaty of Amity: Property of nationals and companies of either High Contracting Party, including interests in property … shall not be taken except for a public purpose, nor shall it be taken without the prompt payment of just compensation. The ICJ stated that a judicial decision ordering the attachment and execution of property or interest in property does not per se constitute a taking or expropriation of that property. Two things are notable here: first, the Court equates takings and expropriations; second, the ICJ requires that an additional condition is fulfilled for a judicial decision so that it may amount to an expropriation, namely an element of illegality.22 The ICJ mentions two situations in which this will be the case: first a denial of justice, and second when a judicial organ applies ‘legislative or executive measures that infringe international law and thereby causes a deprivation of property’.23 The ICJ clarifies that it must examine the legislative, executive, and judicial acts adopted by the United States as a whole.24 It hereby differs from the suggested method of analysis proposed by the Unted States. The United States first explained why the Court should not consider the legislative and executive measures to be expropriatory25 and separately explained why the court decisions implementing these measures should not be an expropriation either.26 Concerning the requirements for a judicial expropriation, the ICJ did not rely on any case law or literature dealing with this issue. This was criticized by judge Bhandari in his declaration where he pointed out that the approach of the ICJ differed from a number of investment arbitration as as the case law of the Court of Human Rights The fact that the ICJ did not in its analysis on case law or literature have been by the approach of the in The United and to a number of investment arbitration in of the police powers concerning the of a judicial expropriation, the United States in its only states that of domestic courts in the role of and of should be separately from legislative and executive decisions not to a claim for The United States based this on State literature or case In its the United States only v and v of which are part of the of cases in which did not in the court proceedings as in dissenting criticized the of the judicial expropriation of the that the ICJ found a denial of justice nor a violation in the proceedings before US This was of the why against a violation of international law concerning the expropriation that it has to to the US measures as a the ICJ stated that the the of the of an to police powers in Article IV(2) of the Treaty of Amity. The Court that the to has been in international law and that exercise of certain regulatory powers by the government aimed at the of legitimate public is not or It for this to case from the the and investment The ICJ its on the police powers by out that powers in this are not the Court stated that it had already that the US measures and by US courts were measures in violation of the obligation under Article of the Treaty of Amity. Article of the Treaty of Amity in its second clause that High Contracting … shall from or measures that and interests nationals and companies of the other High Contracting the whether the US measures were and in breach of the the Court First, it decided that the in legislation were adopted for a public it found that there was an relationship between the and the it found the in to the Therefore, the Court decided by votes to that the United States has violated its obligations under Article of the Treaty of In the expropriation the pointed out that it had already that the legislative provisions adopted by the United States and by its courts were measures in violation of Article of the Treaty of on the the ICJ pointed out that is of the for a to be a regulatory and not an This of from the legislative provisions and judicial enforcement that the ICJ the for the exercise of regulatory powers had not been It found that the measures adopted by the United States to expropriation no compensation had been the Court found that the of the and the FSIA by US courts to takings without compensation in violation of Article IV(2) of the Treaty of to Executive Order the ICJ did not that an expropriation had since Iran had to the property or interests in property of Iranian companies that were Therefore, it found no breach of Article IV(2) of the Treaty in this in pointed out that that regulatory powers are not criticized the Court for not its only on to out the of a not compensation. stated that was not that the violation of Article of the Treaty of Amity to a violation of Article IV(2) of this criticized this of the Furthermore, at the regulatory to States by international courts and stated that it have been obligation to that the measures the that regulatory from In this was not in the case at and were of the that the US measures a of the regulatory powers for the of a legitimate public The United States to victims of terrorist with the to obtain to the ICJ found that a judicial decision ordering the attachment and execution of property or interest in property does not per se constitute a taking or expropriation of that property. 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Abstract Smart contracts govern transactions using the blockchain as the enforcing medium. They may be a cheaper form of governance of transactions compared to traditional contracts, the hierarchy of firms, and relational contracts. However, I argue that smart contracts do not eliminate transaction costs; rather, they can increase them, particularly when considering the issue of ex‐post efficiency‐enhancing adaptation. Thus, while smart contracts offer a new theoretical and practical way to govern transactions, they are not without challenges and limitations.
Off-chain disputes regarding transactions executed on-chain are unavoidable. However, a prerequisite to effectively settling such disputes is the identification of the applicable law as well as of the competent jurisdiction. While some transactions merely operationalise off-chain relations between parties knowing each other, many result from interactions between pseudonymous individuals at unknown locations. The present contribution investigates the concrete consequences of pseudonymity on European Private International Law, especially principles to determine the applicable law. In this respect, it clarifies the numerous factors affecting the extent of pseudonymity, ranging from the type of distributed ledger on which the transaction occurred to the possible centralized intermediaries involved therein. The issue ought to be analysed having these factors in mind, as some effectively wither the veil of pseudonymity. Based on the preceding clarification, the contribution analyses the concrete extent to which pseudonymity renders some principles of European Private International Law ill-fit and as a result, difficult to apply in practice.
Bitcoin was launched in 2008 and appears as the first application of the blockchain technology. It remains, to date, the best known and the most used cryptocurrency. Like other cryptocurrencies, Bitcoin aims to become an alternative to State and multistate currencies, such as the Euro. The importance it has gained in practice over the past few years has grasped the attention of legal scholars, who tend to perceive Bitcoin as a challenge to traditional legal rules and therefore reflect upon the ways the latter can be applied to this technological new deal. Although these reflections concern, first and foremost, rules of substantive law, such as contract law, they also extend to Private International Law (PIL). From the latter perspective, Bitcoin raises two types of issues. The first one relates to the ability of PIL to tackle legal relationships involving the use of bitcoins, while the second one concerns the ways in which PIL rules can be implemented to these relationships. This article seeks to demonstrate that all the objections raised against the applicability of PIL to Bitcoin, whether they are based on the existence of an alleged non-State, self-regulated, legal order of the lex cryptographica, on the impossibility to situate legal relationships implying the use of bitcoins in the physical space, or on the pseudonymity of participants in the blockchain, can be overcome without having to introduce sweeping changes to PIL rules. Indeed, the latter rules can rather easily adapt to Bitcoin and grasp its hybrid nature of asset and of currency.
Abstract Smart contracts are designed to be self-executing and self-enforcing. They are written as computer code that can automatically monitor, execute and enforce the performance of the agreed terms. The code of smart contracts exists across a distributed, decentralised blockchain network, controlling the execution and making transactions trackable and irreversible. This article examines the extent to which the Australian Consumer Law unfair contract term provisions can respond to the use of smart contracts. The article finds that the Australian Consumer Law unfair contract term provisions work relatively well to protect smart contract consumers. While some challenges exist and should be properly considered, there seems to be no need to either create entirely new law, modify the existing regime or totally ban smart contracts to protect consumers against unfair contract terms in smart consumer contracts.
O presente artigo tem como objetivo definir, em nível conceitual, o fenômeno dos smart contracts a partir do referencial teórico de Hart (1983; 1994) quanto à significação de conceitos jurídicos, a fim de verificar sua sujeição às regras legais contratuais. Utiliza-se de método dedutivo e técnica de pesquisa bibliográfica para construir a logicidade interna e realizar o desenvolvimento conceitual dos smart contracts. Considerando o avanço do uso da tecnologia blockchain, a relevância desta análise está no fato de que a delimitação terminológica serve para justificar ou verificar a sua subordinação a normas jurídicas específicas e, portanto, capacidade de disrupção das normas jurídicas, a permitir desconstrução de lege lata e reconstrução de lege ferenda em linha com as funções decorrentes da inovação. O estudo conclui que um smart contract é funcionalmente similar a um contrato, e, portanto, deve ser considerado espécie de contrato para efeito de sujeição às normas contratuais. Adicionalmente, a conclusão indica ser importante que o sistema jurídico contratual considere esta nova espécie de contrato no desenvolvimento e evolução legislativos.
While the general employment of smart contracts has seen growing interest lately, its application in the legal domain raised several concerns . One of the main issues is that these contracts are often written in computer code, thus are difficult to understand for the average person: this could undermine their enforceability before national courts . \nThe present work proposes an approach for solving this lack of transparency: we shall compare and employ declarative programming languages that have already proven to bring helpful advantages when writing smart contracts , such as Logical English and LPS, both based on Prolog, as well as domain-specific imperative languages, such as Stipula , that allow for the codification of a smart legal contract both understandable for the average person and readable by the machine. \nWe will give an outline of the interplay between natural language and programming languages, and show how the lack of understanding reflects on the current employment of smart legal contracts. Fundamental to our reasoning will also be the distinction between B2B and B2C contractual relationships, where the EU principles of clarity and understandability of contract terms come into the picture. Moreover, we believe that uncertainty on whether the contract will execute the code as intended by the parties will negatively impact the trust that people place in such technology. \nWe will demonstrate a methodology for writing smart legal contracts in such a way as to improve both the understanding of their contents, by providing a direct transposition in code of the relevant clauses; and the intelligibility of their execution, by implementing the clauses directly, with no further coding required. This shall be done through Logical English, a programming language in which code is represented using a controlled form of the English language. Our intention is to showcase how to build trust in smart legal contracts, moving through a brief literature review of the proposed solutions, following with a demonstration of the drafting of the contract in a computable language understandable by legal experts and citizens alike. We shall utilize a running example to compare the methods we have applied, looking at the advantages, disadvantages and their effect on the overall explainability of the program. \nTo conclude, we shall compare our results with the desired effect on transparency and see how these may help the general goal of bridging natural language and computer code, especially as far as consumer contracts are concerned. We shall test whether it is possible for the consumer to contribute to the execution process, moving from the written text directly to the computable code, thus strengthening the connection between the contracts and the automation. To reach a common standard, and employ this technology in the legal field, it is necessary to link all parties more closely, be they businesses, consumers, or legal professionals, by providing a way for all to communicate directly with the Smart Legal Contract.
The emergence of smart contracts and the increasing integration of artificial intelligence (AI) have introduced new dimensions to traditional contract law. This research paper aims to explore the profound impact of smart contracts and AI on the foundations and principles of contract law. It examines the benefits, challenges, and legal implications that arise from the adoption of these technological advancements. By analysing relevant case law, scholarly literature, and regulatory frameworks, this paper provides insights into the potential transformation of contract law in the era of smart contracts and AI. This research paper aims to contribute to the ongoing discussion on the impact of smart contracts and AI on traditional contract law. By examining the benefits, challenges, and legal implications, it provides a comprehensive analysis that can inform policymakers, legal practitioners, and scholars in navigating the evolving landscape of contract law in the digital age.
Primavera De Filippi, Morshed Mannan, Wessel Reijers
Abstract Similar to the early days of the Internet, today, the effectiveness and applicability of legal regulations are being challenged by the advent of blockchain technology. Yet, unlike the Internet, which has evolved into an increasingly centralized system that was largely brought within the reach of the law, blockchain technology still resists regulation and is thus described by some as being “alegal”, i.e., situated beyond the boundaries of existing legal orders and, therefore, challenging them. This article investigates whether blockchain technology can indeed be qualified as alegal and the extent to which such technology can be brought back within the boundaries of a legal order by means of targeted policies. First, the article explores the features of blockchain-based systems, which make them hard to regulate, mainly due to their approach to disintermediation. Second, drawing from the notion of alegality in legal philosophy, the article analyzes how blockchain technology enables acts that transgress the temporal, spatial, material, and subjective boundaries of the law, thereby introducing the notion of “alegality by design”—as the design of a technological artifact can provide affordances for alegality. Third, the article discusses how the law could respond to the alegality of blockchain technology through innovative policies encouraging the use of regulatory sandboxes to test for the “functional equivalence” and “regulatory equivalence” of the practices and processes implemented by blockchain initiatives.