Who is Liable if a Cryptocurrency Protocol Fails?
22 Pages Posted: 23 Jul 2019 Last revised: 24 Sep 2019
Date Written: July 21, 2019
Cryptocurrencies have entered the economy as alternative money, speculation objects, and utility tokens for digital platforms. Cryptocurrencies are based on cryptography-based asset disposals broadcasted peer-to-peer to be validated decentrally according to consensus mechanisms in compliance with consented protocols. There several risks associated with the protocols, which may eventually result in the failure of a cryptocurrency. The question is then if anyone can be held liable for such a failure. Such liability is important for both victim compensation as well as the promotion of robust protocols. The paper discusses who can be held liable, possible legal bases for liability, and some legal gaps are identified.
Keywords: Blockchain, Cryptocurrencies, Liability, Open Source
JEL Classification: E42, G28, K13, K24, L17
Suggested Citation: Suggested Citation