Smart Contracts, NFT Trading and Weaker Party Protection

Abstract

“Smart contracts” are characterised by the self-execution of contractual clauses without the need for human intervention, and generally excluding the possibility of interrupting such execution or modifying the content. Non-Fungible Tokens are digital assets that signify ownership of other physical or digital assets. NFTs and related minting, selling and purchasing are publicly verifiable. They are available for trading and exchanging, are persistently stored and cannot be manipulated. The peculiarities of smart contracts and NFT trading give rise to interesting use cases and opportunities, but also to operational issues and legal challenges. Among them, the protection of weaker parties is particularly relevant.

Keywords: Distributed ledger technologies, Blockchain, Smart contracts, Non-Fungible Tokens, NFTs, Weaker parties, Consumers, Protection, EU Law

JEL Classification: K12, K22