Regulation of Blockchains Based on Distributed Ledger Technology

International research and practice journal Law and Digital Economy founded by Kutafin Moscow State Law University (MSAL) 2021, ISSN 2618-8198

16 Pages Posted: 11 Jan 2022

See all articles by Stephan Breu

Stephan Breu

Johann Heinrich Pestalozzi Christian University Inc.; Kutafin Moscow State Law University; Universidad Complutense de Madrid - Grupo CONCILIUM; Faculdade Interativa de São Paulo - FAISP; Faculdade do Bico do Papagaio - FABIC; Swiss Centre for International Humanitarian Law; Legal Forum Cannes

Date Written: November 25, 2021

Abstract

The digital economy and Distributed Ledger Technology (DLT) are developing rapidly into our business and private life. The technology enables a way to secure decentralized datasets without involvement of third parties or intermediates in a secure, auditable and incorruptible way. Storing data on worldwide peer-to-peer networks makes these applications difficult to regulate as they are not residing in a specific area of influence of any given regulation or jurisdiction. Blockchain applications based on DLT offer an extensive level of anonymity to their stakeholders. In future artificial intelligence could start to optimize the applications and trigger decisions automatically which will become a major challenge for competition and anti-trust regulators. Based on the Bitcoin technology we will see that there are fair possibilities to regulate the ledgers indirectly through existing legal and regulatory systems. Also, strong self-regulation will play a part to make these technologies widely acceptable. Capacity building has to be emphasized to keep the asymmetry of information between regulators, industry and consumer as small as possible. Some scholars already claim that blockchains have already started to create a supranational economy in which the classical idea of a legal person is obsolete whereas the supranational law is not really designed to address these new developments yet.

Keywords: Regulation, Distributed Ledger Technology, Blockchain, Cryptocurrencies

Suggested Citation

Breu, Stephan, Regulation of Blockchains Based on Distributed Ledger Technology (November 25, 2021). International research and practice journal Law and Digital Economy founded by Kutafin Moscow State Law University (MSAL) 2021, ISSN 2618-8198, Available at SSRN: https://ssrn.com/abstract=3971814

Stephan Breu (Contact Author)

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