[ad_1]
Fundamental problem of blockchain
One of the most significant developments in digital asset regulation is in the world of private commercial law. Consider the monumental advisory paper issued last year by the England and Wales Law Commission. digital assetsThat consultation has ended, but we are awaiting a final legal proposal. This advisory document is one of the most comprehensive advisory documents publicly available. It contains nearly 600 pages of in-depth legal analysis and discussion of issues related to tokens and other digital assets. It’s an excellent primer, if not a bedtime read.
A fundamental issue addressed by the Legal Commission is the lack of ownership of “digital assets.” blockchain ledger. For example, by depositing money in a bank, account, a liability owed by a bank (a regulated entity) to its depositors. This is an old and solid law. The result of a digital asset is neither selected ownership (you cannot “own” a digital asset) nor selected behavior (an entry into the ledger is simply an entry).It’s an old firm rule that there is only this 2 asset class.
This is a big problem for those who invest in digital assets such as cryptocurrencies. Blockchain is a useful device when all is well in an encapsulated commercial venture, but when things go wrong, blockchain proves to be a failure (instead of relying solely on the blockchain mechanism, intended to remove the need to trust the power of state control). The saying (perhaps mistakenly) of Lenin, “Trust is good, but control is better,” is true.
The solution proposed by the Legal Commission was Third-class assets Created with statutory sponsorship. This will revolutionize personal property law. More information will be available as the Legal Commission’s final report is due out later this year.
This position should be carefully distinguished from third-party intermediaries that hold digital assets in their third-party accounts.There is a wealth of case law, but it is all first-instance or even first-instance one-sided It addresses the question of what remedies can be taken to preserve those assets without the other side objecting. Every case is different and the terms of these accounts should be carefully researched. Celsius Network LLC (U.S. Bankruptcy Court, Jan. 4, 2023), the contract clarified that the assets remained with the central depository.
But these are not the only problems. Many consequent problems arise. For example, one of the important things is to ensure security. Most security laws around the world rely on the concept of ‘ownership’, which has no clear meaning in the digital world. A number of proposals have surfaced globally that suggest important changes to securities law, including making the concept of “control” a central concept. Whatever that means, it involves the concept of ‘intention’, in which at least it is distinguished from the concept of ‘possession’. The United States Uniform Law Commission is proposing amendments to the Uniform Commercial Code to make this change. can also be compared with Australian Personal Securities Act 2009.
Unidroit
A new consultation is currently being conducted by UNIDROIT. one of the forgotten institutions of international law, UNIDROIT – Institute for Unification of Private International Lawwas an entity within the League of Nations, but ran into a minor problem that the League of Nations disappeared after the war. However, it was reconstituted under international law and is now a very active body dealing with international law reform Based in Rome, its purpose is to study the needs and methods of modernizing, harmonizing and coordinating private law, especially commercial law, between states and groups of states, and to create a unified legal body to achieve those aims. It is to formulate legal documents, principles and regulations.
One of UNIDROIT’s major projects from 2020 to the present is Digital Assets and Private LawWe have developed a set of principles aimed at providing guidance in trading to give certainty to practitioners, judges, legislators and market participants. It is also intended to be the basis of state law so that there is a common language and principles governing transactions not only within the state but also across state lines. They include a discussion and restatement of principles dealing with the definition of digital assets, the importance of management, issues related to the transfer of digital assets, custodial relationships, conflicts of law, protected transactions, enforcement, and bankruptcy. increase.
These principles are important and decisive statements of legal concepts and worth considering if you are involved in any way with digital assets. To follow up on one aspect only, Principle 6 It provides a good definition of “administration” that has been adopted by other law-making bodies, including legal commissions. The language contained in this document is useful in drafting transaction documents, even if the principles have not been adopted by local law.
UNIDROIT Consultation
The UNIDROIT document is now open for consultation. Comments are due by February 20, 2023. All comments should be provided using this. online form.
[ad_2]
Source link
