Floating Liens Over Crypto-in-Commerce

24 Pages Posted: 25 Apr 2023 Last revised: 30 Jan 2024

See all articles by Christopher K. Odinet

Christopher K. Odinet

Texas A&M University School of Law

Andrea Tosato

University of Nottingham, School of Law; University of Pennsylvania Carey Law School

Date Written: May 22, 2023

Abstract

Commercial law and crypto are colliding. Against the backdrop of explosive growth (and discord) in the digital asset market, there has been a series of recent revisions to American commercial law aimed at addressing new and emerging technologies. These changes to the Uniform Commercial Code (UCC) are designed to facilitate the buying and selling of digital assets as well as their use as collateral. However, to date, the literature exploring these changes has mainly focused on understanding the basics of the new regime. This Essay moves beyond that baseline by showing how the UCC amendments can be used to structure more complex secured credit arrangements that tap into the borrowed capital potential of blockchain technology. Specifically, this study explains how these recent law reforms—in concert with the inherent capabilities of distributed ledgers, smart contracts, and cryptography—can be used to create a floating lien (the quintessential financing device in American commercial law) over crypto inventory.

Keywords: crypto, blockchain, UCC, uniform commercial code, bitcoin, tokens, DLT, inventory financing, secured transactions, secured credit, commercial law, NFTs, floating liens, floating charges, Article 12, controllable electronic records

Suggested Citation

Odinet, Christopher K. and Tosato, Andrea, Floating Liens Over Crypto-in-Commerce (May 22, 2023). 99 Indiana Law Journal 367 (2023), U Iowa Legal Studies Research Paper No. 2023-17, Available at SSRN: https://ssrn.com/abstract=4424022

Christopher K. Odinet (Contact Author)

Texas A&M University School of Law ( email )

1515 Commerce St.
Fort Worth, TX Tarrant County 76102
United States

Andrea Tosato

University of Nottingham, School of Law ( email )

Law and Social Science Building
University Park
Nottingham, NG7 1BB
United Kingdom

University of Pennsylvania Carey Law School ( email )

Philadelphia, PA
United States

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