In this edition of her column, Lucy considers the legal
statement on the status of cryptoassets and smart contracts
published by the UK Jurisdiction Taskforce.
UK Jurisdiction Taskforce legal statement on status of cryptoassets
and smart contracts
The key findings of the legal statement on the status of
cryptoassets and smart contracts published by the UK Jurisdiction
Taskforce ("UKJT") earlier this month are that
cryptoassets are in principle to be treated as property and that
smart contracts can be interpreted using ordinary established legal
principles. The legal statement carries no legal weight but is
likely to inform legal arguments and judgments.
The conclusion that a cryptoasset is capable of being property
matters because proprietary rights are recognised against the whole
world and are of particular importance in scenarios involving
insolvency, loss, fraud and theft. Proprietary rights are also
relevant to the questions of whether there can be a security
interest in a cryptoasset and whether a cryptoasset can be held on
trust. From a financial services practitioner's perspective,
however, the key findings from a day-to-day cryptoasset context
relate to the legal statement's analysis around blockchain
transactions and the status of private keys.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.