Blockchain technology is sometimes also referred to as Distributed Ledger Technology or Shared Ledger Technology. While these notions remain in flux and some consider them to designate different forms of technology, I will refer to them interchangeably for the sake of simplicity.
More generally, this is true of a large majority of start-ups, which does not, however, have to be seen as a negative score given that even unsuccessful start-ups give rise to a healthy ecosystem and train talent that can ultimately join or launch successful projects.
Where not otherwise specified, the term regulators is used generically to refer to any lawmakers and regulators across jurisdictions, whether they operate a transnational, supranational, national, or subnational level.
For a more detailed account, see Michèle Finck, Blockchain Regulation and Governance in Europe (forthcoming, Cambridge University Press 2018).
A much more detailed engagement with these themes is provided in Michèle Finck, Blockchain Regulation and Governance in Europe (forthcoming, Cambridge University Press 2018).
For instance, it remains unsettled whether a blockchain is the same as a distributed ledger. On this, see further Angela Walch, The Path of the Blockchain Lexicon (and the Law), 36 Rev. of Banking and Fin. L. (forthcoming), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2940335 [hereafter “Walch, The Path of the Blockchain Lexicon”] (noting that a lack of settled terminology burdens discussions between regulators and industry as well as between jurisdictions).
Aaron Wright & Primavera De Filippi, Decentralized Blockchain Technology and the Rise of Lex Cryptographia, 1, 2 (2015) [hereafter “De Filippi & Wright, Lex Cryptographia”].
See Walch, The Path of the Blockchain Lexicon, supra note 7, at 16.
Consensus remains an unstable and evolving characteristic of blockchains with various blockchains relying on divergent mechanisms that each have advantages and disadvantages.
For an overview of early applications of the technology, see infra Section I. below.
Kevin Werbach, Trust but Verify: Why the Blockchain Needs the Law, Berkeley Tech. L.J. 1, 4 (forthcoming 2018).
William Mougayar, The Business Blockchain xxiv (Wiley ed., 2016).
Werbach, Kevin D., Trustless Trust
Susan Athey, 5 Ways Digital Currency Will Change the World, World Econ. Forum Agenda (Jan. 22, 2015).
Note, however, this distinction between full and lightweight nodes.
No blockchain has been hacked to date.
This function is fulfilled by online oracles.
Werbach, Kevin & Cornell, Nicolas, Contracts Ex Machina, Duke L.J. (forthcoming).
De Filippi &Wright, Lex Cryptographia, supra note 8, at 27.
Current examples include Storj, La'Zooz, and OpenBazaar.
De Filippi &Wright, Lex Cryptographia, supra note 8, at 39.
Eur. Parl. Res. (2016/2007(INI)) art. 1 (2016).
IBS Testing of BC for Mahindra Group.
On the sharing economy, see further Handbook.
Hancock & Vaizey, supra note 34, at 65.
Another indication of the speed with which this domain evolves is the increasing number of patents filed in relation to blockchain technology, including by established institutional actors. See
Zhao, Wolfie, Bank of America Files for 3 New Blockchain Patents, CoinDesk (Aug. 1, 2017), https://www.coindesk.com/bank-america-files-3-new-blockchain-patents/.
See A European Agenda for the Collaborative Economy, COM (2016) 356 final (June 2, 2016).
These strategies are introduced below.
An ICO is a means to raise capital for a new cryptocurrency venture.
The terminology is a play on the term development sandbox that denotes a safe environment for developers to work on software.
See also Walch, The Path of the Blockchain Lexicon, supra note 7.
Moses, Lyria Bennett, Agents of Change: How the Law “Copes” with Technological Change, 20 Griffith L. Rev. 763 (2011).
See Environmental Management, ISO, ISO/TC 207 (last visited May 15, 2018).
Werbach, Kevin, The Song Remains the Same: What Cyberlaw Might Teach the Next Internet Economy, Fla. L. Rev. 1 (forthcoming, 2018) [hereinafter “Werbach, The Song Remains the Same”].
See Werbach, The Song Remains the Same, supra note 89, at 63.
See Michèle Finck & Sofia Ranchordas, Sharing and the City, 49 Vand. J. of Transnat'l L. 1299 (2016).
Werbach, The Song Remains the Same, supra note 89, at 1.
Gabinson, Garry A., Policy Considerations for the Blockchain Public and Private Applications, 19 SMU Sci. & Tech. L. Rev. 327 (2016).
Fenwick, Mark, Wulf Kaal & Erik Vermeulen, Regulation Tomorrow: What Happens When Technology is Faster Than the Law? (Univ. of St. Thomas (Minnesota) Legal Studies Lex Research Topics in Corp. L. & Econ. Working Paper No. 2016–8, 2016).
Johnson, David & Post, David, Law and Borders: The Rise of Law in Cyberspace, 48 Stanford L. Rev. 1367 (1996).
See also Michèle Finck, Blockchain Regulation and Governance in Europe (forthcoming, Cambridge University Press 2018).
Christopher Marsden, Internet Co-Regulation 46 (Cambridge University Press 2011).
For a more critical take on the decentralized nature of these entities, see Walch, Angela, The Fiduciaries of Public Blockchains (working paper on file with author).
It is worth noting that this is also the rationale behind blockchain-based prediction markets such as Augur. See Augur, https://augur.net/.
Callon, Michel, Pierre Lascoumes &;Yannick Barthe, Acting in an Uncertain World (MIT Press 2009). It is also important to stress that where such cooperation does not go as planned the regulator is always free to withdraw from such efforts and regulate in a traditional top-down manner.
For a discussion of these techniques, see Sofia Ranchordás, Innovation Experimentalism in the Age of the Sharing Economy, 19 Lewis & Clark L. Rev. 871 (2015).
See Hancock & Vaizey, supra note 34, at 11.
For an overview of this instrument, see Opinion of the European Economic and Social Committee, The 28th Regime – an Alternative Allowing Less Lawmaking at Community Level, INT /499 (2010).
Blockchain's permanence of records can however also be considered to add a significant advantage to regulators from a detection perspective as unlike paper and online records, those on blockchain cannot be erased.
Werbach, The Song Remains the Same, supra note 89.
See Perez C., Technological Revolutions and Techno-Economic Paradigms (Tallinn Univ. of Tech., Tech. Gov't and Econ. Dynamics, Working Papers, 2009).