Discussing legal issues related to smart contracts on the blockchain is very topical. This article will discuss primarily smart contracts on the blockchain the conclusion and execution of which... Show moreDiscussing legal issues related to smart contracts on the blockchain is very topical. This article will discuss primarily smart contracts on the blockchain the conclusion and execution of which does not interact with the physical world, as well as briefly touch upon smart contracts on the blockchain which do interact with the physical world. For these smart contracts, it will be determined to what extent existing EU internet laws can help support their development and if not, what is needed to support this. In order to answer this question, the following will be discussed: the rise of e-commerce and in particular the EU internet laws supporting and regulating e-commerce, how smart contracts work and how smart contracts compare with existing technological developments and comparable legal constructs (internet, bank accounts and bank guarantees). Subsequently, it will be explained how the use of smart contracts leads to a shift of confidence, from trust in people to trust in code. On the basis of The DAO hack and the problems that arose, it will be illustrated that this shift to trust in code is not as absolute as is often thought. The article concludes that applying specific EU laws on supporting and regulating e-commerce to smart contracts is difficult for two reasons. First of all, the starting points differ: trust in people versus trust in code. Secondly, technical and practical obstacles often inhibit applying internet laws in a meaningful manner. When using smart contracts, it makes more sense to prevent problems from arising than to correct them afterwards. For this reason, it is advocated that programmers work together with lawyers to create better smart contracts and that the legislator focuses on laws dealing with auditing smart contracts code by trusted third parties and automatically equating smart contracts with written contracts with wet ink signatures. This will hopefully facilitate the rise of smart contracts on the blockchain. Show less
It is unclear how bitcoins should be qualified from a legal perspective. This qualification is, among other things, relevant to determine how bitcoins should be transferred, pledged, attached and... Show moreIt is unclear how bitcoins should be qualified from a legal perspective. This qualification is, among other things, relevant to determine how bitcoins should be transferred, pledged, attached and executed. In this article, bitcoins and bitcoin transfers are explained from a technical perspective and subsequently qualified from a contract and property law perspective. Given the borderless nature of bitcoins and its underlying bitcoin technology, these subjects are dealt with in an international manner, often drawing upon legal concepts which form the backbone of most if not all legal systems, especially those in the EU. In this article, the following conclusions are reached. First of all, from a contract law perspective, the bitcoin network qualifies as a multi-party contract to which the various participants (users, miners and nodes) accede by participating in the network for the first time and, in doing so, accept the third-party rights clause stipulated in that agreement in their favour. Secondly, from a property law perspective, the rights with respect to the bitcoins credited to a bitcoin address are put to bearer at the same moment these bitcoins are so credited. They are put to the bearer of the value bearer on which the private key associated with that bitcoin address is stored. That value bearer embodies the right of that bearer to perform the work necessary to transfer the bitcoins on that bitcoin address, more specifically vis-à-vis the miners to validate that transaction and vis-à-vis the nodes to verify the work of the winning miner. Those bitcoin rights can be transferred, pledged, attached and executed by possession of the value bearer. Show less
