56 Pages Posted: 27 Apr 2021 Last revised: 7 Mar 2022
Date Written: 2021
The concept of possession is currently considered inapplicable to intangible assets, whether data, cryptocurrency, or NFTs. Under this view, intangible assets categorically fall outside the purview of property law’s foundational doctrines. Such sweeping conclusions stem from a misunderstanding of the role of possession in property law. This Article refutes the idea that possession constitutes—or even requires—physical control by distinguishing possession from another foundational concept, that of thinghood. It highlights possession’s unique purpose within the property process: conveying the status of in rem claims. In property law, the concept of possession conveys to third parties the allocation of property rights and related duties. As such, possession builds upon the concept of thinghood; it is a subsequent analytical step through which the law can normatively and efficiently expect individuals to comply with their duty to not interfere with the property of others. Given its centrality in property law, then, possession should not be so quickly discarded in the context of intangibles.
The Article dissects the relationship between property, possession, and thinghood, deriving a new tech-neutral theoretical model of possession grounded in information theory. By unpacking the process through which the social institution of property emerges, this Article provides the rationale for a new theory of possession. This theory aims to be more descriptively accurate, analytically coherent, and parsimonious in the face of an ever more diverse set of assets that are subject to resource governance regimes. It also highlights the importance of distributed, accessible information. Clearly conveying the allocation of rights and duties is critical for the success of any resource governance regime, digital or otherwise.
Ultimately, property law relies on possession’s communicative function to ensure that the enforcement of rights and duties is fair and expected. The theory of possession proposed in this Article provides a robust way for property law to retain these same benefits in the age of digital and crypto-assets.
Keywords: Property, Property Law, Possession, Intangible, NFT, Crypto, Ownership
JEL Classification: K11
Suggested Citation: Suggested Citation