When Jurisdiction Rules Meet Blockchain: Can the Old Bottle Contain the New Wine?

Stanford Journal of Blockchain Law & Policy (forthcoming, 2023)

17 Pages Posted: 10 Feb 2022 Last revised: 26 Sep 2022

See all articles by Alex Yueh-Ping Yang

Alex Yueh-Ping Yang

National Taiwan University - College of Law

Date Written: January 1, 2022

Abstract

The distributed nature of blockchain poses challenges to the existing legal system, notably the jurisdiction rules addressing court jurisdiction and governing laws. The In re Tezos case, a securities law dispute brought in the District Court of Northern District of California of the United States, was the case facing this particular challenge. In this paper, I conduct a case study of the In re Tezos case to illustrate how the distributed nature of blockchain impacts the determination of court jurisdiction and governing law in the securities regulation context. I argue that while the internet has already complicated those effect-based jurisdiction rules, blockchain further complicated those conduct-based jurisdiction rules. With this understanding, I offer several principles for addressing the jurisdiction issues in cases involving blockchain-based securities. Specifically, I propose an effect-based jurisdiction rule limited by a de minimis exception to mitigate blockchain’s impact, enhance legal certainty, and promote international coordination.

Keywords: blockchain, jurisdiction, securities regulation, initial coin offering, ICO, In re Tezos, Morrison transaction test, conduct test, effect test

Suggested Citation

Yang, Alex Yueh-Ping, When Jurisdiction Rules Meet Blockchain: Can the Old Bottle Contain the New Wine? (January 1, 2022). Stanford Journal of Blockchain Law & Policy (forthcoming, 2023), Available at SSRN: https://ssrn.com/abstract=4027692 or http://dx.doi.org/10.2139/ssrn.4027692

Alex Yueh-Ping Yang (Contact Author)

National Taiwan University - College of Law ( email )

No.1, Sec.4, Roosevelt Road
Taipei, 10617
Taiwan

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