National Blockchain Laws as a Threat to Capital Markets Integration

32 Pages Posted: 8 Jun 2021

Multiple version iconThere are 2 versions of this paper

Date Written: June 7, 2021


Various states have started providing private law frameworks for blockchain transfers
and crypto assets. The first acts have been adopted by France and Liechtenstein,
while a commission of the British government sees no difficulties in extending property
protection under the Common law to crypto assets. In the US, an amendment to the
Uniform Commercial Code has been suggested, which has not stopped some States
going their own, different way. The aim in all cases is to promote the use of modern
distributed ledger technology and enhance investor protection.
While these initiatives will increase legal certainty, they differ significantly. This
has an important downside: there is a strong risk that the blockchain will be made
subject to diverging legal rules. Similar to the world of intermediated securities, various
national laws will need to be consulted to determine the rights and privileges of
investors. This may increase transaction costs, thwart interoperability and produce
thorny conflict-of-laws problems. Markets risk being fragmented into national
segments, with an inevitable diminution of their depth and liquidity.
As a remedy, this article suggests developing uniform rules for the blockchain.
Before national legislators and judges once again divide the world through
idiosyncratic rules, the private law of crypto assets should be harmonised to the
highest degree possible. Uniform rules should ideally be forged at the global level, by
fora like the International Institute for the Unification of Private Law (UNIDROIT), the
United Nations Commission on International Trade Law (UNCITRAL), and the Hague
Conference on Private International Law. In the absence of world-wide rules,
uniformisation of private law should take place at the regional level, for instance by the
European Union. The article makes specific suggestions as to how this can be
achieved and what the content of those rules should be.

Keywords: Bitcoin, Blockchain, Distributed Ledger Technology, private law, uniform law, property, insolvency, good faith acquisition

JEL Classification: K10, K11, K22, G15, G19, O33

Suggested Citation

Lehmann, Matthias, National Blockchain Laws as a Threat to Capital Markets Integration (June 7, 2021). European Banking Institute Working Paper Series 2021 - no. 95, Available at SSRN: or

Matthias Lehmann (Contact Author)

University of Vienna ( email )

Schottenbastei 10-16
Vienna, A-1010
+431427735122 (Phone)
1010 (Fax)

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