Legal Issues for Blockchain Technology.
At first glance, the decentralised, encrypted and self-executing character of blockchain technological applications does seem to rely upon or assume a self-regulatory approach that would in principle operate in parallel to the traditional legal instruments. However, looking more carefully at the most advanced blockchain applications, a mixture of traditional and novel legal and regulatory questions are raised that must be considered in a contextual manner as some of the above-mentioned applications challenge fundamental tenets of law and diffuse the object of regulatory attention, as such, in a variety of ways. First of all, the decentralised, cross-boundary character of blockchain raises jurisdictional issues as it seems to diffuse institutional accountability and legal responsibility in an unprecedented manner, rendering the need for a harmonised regulatory approach at the transnational level more pertinent compared with a local or regional one. If blockchain technology developed significantly, centralised structures of law might lose their ability to control the ledger, with control passing to their users or other parties in the system, or to shape the activities of disparate people or autonomous decentralised organisations, as no one (including the original creator) can control the ledger after it has been deployed. There will be fewer checkpoints to guide and assist the flow of data. There are also various issues that need to be considered such as the legal enforceability of smart contracts, and liability and accountability issues, as distributed ledgers currently lack the legal personality that is necessary for them to be assigned with responsibilities and liabilities. This issue is exacerbated by the fact that they operate across borders and that smart contracts may not yet be capable of performing complex operations. http://www.europarl.europa.eu/RegData/etudes/IDAN/2017/581948/EPRS_IDA%282017%29581948_EN.pdf