Law Commons^™

Legal Uncertainty In Virtual Worlds And Digital Goods: Do The Same Laws Apply?, Alanna Sadler

University of Miami Business Law Review

The growth of virtual worlds and digital goods will force US courts to examine whether traditional laws are sufficient to protect consumers. To do so requires judges and legislative officials to possess a deep understanding of concepts that are everchanging. Many aspects of virtual worlds, such as the metaverse(s), are driven by web3 technology, the technology responsible for the NFT and cryptocurrency craze of recent years. It is impossible to ascertain the impact of virtual worlds on daily life, however, companies must nevertheless prepare for the shift toward virtual spaces and digital goods. There is greater skepticism regarding the utility …

Emerging Technology's Unfamiliarity With Commercial Law, Carla L. Reyes

Faculty Journal Articles and Book Chapters

Over the course of a three-year, collaborative process that was open to the public, the Uniform Law Commission (ULC) and the American Law Institute (ALI) undertook a project to revise the Uniform Commercial Code (UCC) to account for the impact of emerging technologies on commercial transactions. The amendments, approved jointly by the ULC and ALI in July 2022, touch on aspects of the entire UCC, but one change has inspired ire and attracted national media attention: a proposed revision to the definition of “money.” The 2022 UCC Amendments alter the definition of “money” to account for the introduction of central …

After Ftx: Can The Original Bitcoin Use Case Be Saved?, Mark Burge

Faculty Scholarship

Bitcoin and the other cryptocurrencies spawned by the innovation of blockchain programming have exploded in prominence, both in gains of massive market value and in dramatic market losses, the latter most notably seen in connection with the failure of the FTX cryptocurrency exchange in November 2022. After years of investment and speculation, however, something crucial has faded: the original use case for Bitcoin as a system of payment. Can cryptocurrency-as-a-payment-system be saved, or are day traders and speculators the actual cryptocurrency future? This article suggests that cryptocurrency has been hobbled by a lack of foundational commercial and consumer-protection law that …

Place Your Bets: The Legal Integration Of Sports Betting With Cryptocurrency, Andrew Topps

UNH Sports Law Review

No abstract provided.

Digital Property Cycles, Joshua Fairfield

Washington and Lee Law Review

The present downturn in non-fungible token (“NFT”) markets is no cause for immediate alarm. There have been multiple cycles in both the legal and media focus on digital intangible property, and these cycles will recur. The cycles are easily explainable: demand for intangible property is constant, even increasing. The legal regimes governing ownership of these assets are unstable and poorly suited to satisfying the preferences of buyers and sellers. The combination of demand and poor legal regulation gives rise to the climate of fraud that has come to characterize NFTs, but it has nothing to do with the value of …

Concealing More Than Your Affairs: A Deep Dive Into The World Of Cryptocurrency And Its Future Influence On Family Law In Ohio, Milica Prica

Cleveland State Law Review

This Note dives into the world of cryptocurrency and family law in Ohio. With its current popularity and dramatic fluctuations, cryptocurrency has created a new legal issue in the family law practice. Specifically, this Note focuses on the concealability of Bitcoin and how that influences division of property, spousal support, and child support in Ohio divorce proceedings and settlements. To tackle this issue, this Note begins with the history of Bitcoin, its value since the beginning, as well as the reason for its fluctuations. This Note also looks into what makes Bitcoin and other cryptocurrency forms so concealable. This Note …

Regulatory Sandboxes Enable Pragmatic Blockchain Regulation, Joshua Durham

Washington Journal of Law, Technology & Arts

Since blockchain technology supports digitally-native money, the centralized chokepoints that governments have traditionally targeted to regulate commerce no longer apply to our (digital) property. However, competent regulation furthers basic public policy goals and should enable responsible innovation of this promising technology. This Article discusses pragmatic policies that enable responsible innovation by cultivating regulatory expertise required to write enforceable rules. Responsible innovation is necessary because unlike the early internet, where programmers could manipulate simple colors and text on webpages, these same individuals can now create financial services applications that manipulate actual money—we are faced with an inescapable reality that more is …

Making Virtual Things, Joshua A.T. Fairfield

Scholarly Articles

People value virtual things—such as NFTs—because such assets trigger and satisfy deep-seated narratives of property and ownership. The cause of the recent series of failures to regulate virtual assets, and the resulting crashes, has been a failure to take seriously the ways people perceive and use the assets. Current legal frameworks fail to support buyers’ and users’ expectations of ownership in virtual things they purchase.

Making virtual things is a matter of social construction of value. Virtual things, like real-world things, have value because a community values them for a purpose. It therefore makes no sense to discount how and …

The Failure Of Market Efficiency, William Magnuson

Faculty Scholarship

Recent years have witnessed the near total triumph of market efficiency as a regulatory goal. Policymakers regularly proclaim their devotion to ensuring efficient capital markets. Courts use market efficiency as a guiding light for crafting legal doctrine. And scholars have explored in great depth the mechanisms of market efficiency and the role of law in promoting it. There is strong evidence that, at least on some metrics, our capital markets are indeed more efficient than they have ever been. But the pursuit of efficiency has come at a cost. By focusing our attention narrowly on economic efficiency concerns—such as competition, …

The 'Merge' Did Not Fix Ethereum, Hilary J. Allen

Popular Media

The Ethereum blockchain that facilitates much of the crypto world last month finally accomplished the long-promised and oft-delayed “Merge”, a technical switch in the way it works.

Tokenized: The Law Of Non-Fungible Tokens And Unique Digital Property, Joshua A.T. Fairfield

Indiana Law Journal

Markets for unique digital property—digital equivalents of rare artworks, collectible trading cards, and other assets that gain value from scarcity—have exploded in the past few years. At root is the next iteration of blockchain technology, unique digital assets called non-fungible tokens. Unlike bitcoin, where one coin is the same as another, NFTs are unique, each with different attributes. An NFT that represented ownership of Boardwalk would be quite different from one that represented Baltic Avenue.

NFTs have grown from a few early breakout successes to a rapidly developing market for unique digital treasures. The attraction to buyers is that, unlike …

On Monopolistic Practices In Bitcoin: A Coded Solution: A Coded Solution, Sanya Samtani, Varun Baliga

Indian Journal of Law and Technology

The underlying values inherent in the creation of bitcoins are those of decentralization and accessibility. The horizontal power structure is an integral part of bitcoins’ architecture – this paper seeks to find a feasible alternative to status quo in order to preserve these characteristics. First, we look at the harms of monopolies and how the concentration of bitcoins is exceptionally harmful to its continued existence. Second, we expose the inadequacies of the existing regulatory frameworks, and discuss how status quo militates against the foundational ideology of bitcoin as a non-institutional cryptocurrency. Third, we undertake a comparative study of the existing …

Is Bitcoin The New Gold? The Two May Be More Similar Than You Think, Including Their Value, Uses, And Deleterious Effects On The Environment, Justin Allen

Environmental and Earth Law Journal (EELJ)

In the 1850s, the Gold Rush started in the United States, and in 2010, an analogous phenomenon, the Cryptoboom, began. Similar to the Gold Rush, Bitcoin’s initial boom was marred by the deleterious effects that mining for valuable coins had on the environment, but there are steps that can be taken to mitigate the negative effect cryptocurrencies have on the environment. Cryptocurrencies, including Bitcoin and the blockchain technology that powers cryptocurrencies, have been widely embraced by many people, corporations, and even entire governments for a multitude of reasons. Some have embraced the fruits of blockchain to use as a decentralized …

Are Cryptopunks Copyrightable?, Brian L. Frye

Pepperdine Law Review

Larva Labs’ CryptoPunks NFTs are iconic. Created in 2017, they were among the first NFTs on the Ethereum blockchain. Four years later, they are among the most valuable, selling for anywhere from $200,000 to millions of dollars. The CryptoPunks collection consists of 10,000 NFTs, each of which is associated with a unique CryptoPunks image. Everyone knows who owns each CryptoPunks NFT. The Ethereum blockchain provides indelible proof. But people disagree about who owns - and who should own - the copyright in the CryptoPunks images. Most CryptoPunks NFT owners believe they should own the copyright in the image associated with …

Possessing Intangibles, João Marinotti

Northwestern University Law Review

The concept of possession is currently considered inapplicable to intangible assets, whether data, cryptocurrency, or NFTs. Under this view, intangible assets categorically fall outside the purview of property law’s foundational doctrines. Such sweeping conclusions stem from a misunderstanding of the role of possession in property law. This Article refutes the idea that possession constitutes—or even requires—physical control by distinguishing possession from another foundational concept, that of thinghood. It highlights possession’s unique purpose within the property process: conveying the status of in rem claims. In property law, the concept of possession conveys to third parties the allocation of property rights and …

A Pause On Proof-Of-Work: The New York State Executive Branch's Authority To Enact A Moratorium On The Permitting Of Consolidated Proof-Of-Work Cryptocurrency Mining Facilities, Jacob Elkin

Sabin Center for Climate Change Law

As cryptocurrency mining facilities have expanded their energy consumption, certain fossil fuel power plants have increased energy generation to provide behind-the-meter power to cryptocurrency miners. The New York legislature has responded by proposing bills to enact a moratorium on state permitting of such consolidated facilities while the New York Department of Environmental Conservation (DEC) studies their impacts through a Generic Environmental Impact Statement (GEIS), but these bills have stalled. This white paper analyzes the legal authority of the New York executive branch to put in place such a moratorium and concludes that the executive branch does possess such authority, though …

Does Cryptocurrency Staking Fall Under Sec Jurisdiction?, Nicholas E. Gonzalez

Fordham Journal of Corporate & Financial Law

Bitcoin, the first blockchain and cryptocurrency (crypto), launched in 2009 when the Bitcoin network opened to the public. A blockchain is a digital ledger technology where transactions are aggregated and permanently recorded into blocks of information. Maintenance of a blockchain is typically conducted by decentralized managers who own and operate network computers (“Nodes”) and serve the functions normally handled by central intermediaries to validate and confirm transactions. All Nodes follow a blockchain protocol. In Bitcoin’s and most cryptos’ cases, this protocol is known as a Proof- of-Work protocol which requires a large amount of energy consumption. Consequently, Proof-of-Stake protocols (“PoS”) …

The Future Of Cryptocurrency And Real Estate Transactions, Rachel Silverstein

Touro Law Review

Bitcoin and other cryptocurrencies are all the rage right now and are beginning to make their ways into everyday transactions— including real estate transactions. This article discusses whether using cryptocurrencies to complete real estate transactions will become the norm in the near future. Cryptocurrency laws in general are few and far between, but laws surrounding cryptocurrency and real property are even more sparse. Recent case law involving cryptocurrency is a major focus of this article, along with background knowledge about cryptocurrency and the meaning of “money” as we know it today. The article concludes with a discussion about the unlikelihood …

Developments In The Laws Affecting Electronic Payments And Financial Services, Sarah Jane Hughes, Stephen T. Middlebrook, Tom Kierner

Articles by Maurer Faculty

The past year proved to be a busy period for the regulation of electronic payments and financial services. In this year’s survey, we discuss rulemakings, enforcement actions, and other litigation that has significantly impacted the law governing payments and financial services. Part II addresses the ongoing fight between federal and state authorities over which should properly regulate Fin- Tech entities and describes some new steps the Office of the Comptroller of the Currency (“OCC”) has taken to assert its authority in this area. Part III details an enforcement action that California regulators took against a FinTech company they determined had …

Blockchain Networks As Knowledge Commons, Ilia Murtazashvili, Jennifer Brick Murtazashvili, Martin B. H. Weiss, Michael J. Madison

Articles

Researchers interested in blockchains are increasingly attuned to questions of governance, including how blockchains relate to government, the ways blockchains are governed, and ways blockchains can improve prospects for successful self-governance. Our paper joins this research by exploring the implications of the Governing Knowledge Commons (GKC) framework to analyze governance of blockchains. Our novel contributions are making the case that blockchain networks represent knowledge commons governance, in the sense that they rely on collectively-managed technologies to pool and manage distributed information, illustrating the usefulness and novelty of the GCK methodology with an empirical case study of the evolution of Bitcoin, …

Creating Cryptolaw For The Uniform Commercial Code, Carla L. Reyes

Washington and Lee Law Review

A contract generally only binds its parties. Security agreements, which create a security interest in specific personal property, stand out as a glaring exception to this rule. Under certain conditions, security interests not only bind the creditor and debtor, but also third-party creditors seeking to lend against the same collateral. To receive this extraordinary benefit, creditors must put the world on notice, usually by filing a financing statement with the state in which the debtor is located. Unfortunately, the Uniform Commercial Code (U.C.C.) Article 9 filing system fails to provide actual notice to interested parties and introduces risk of heavy …

Blockchain And Its Potential Real-World Applications: Implications On Discovery Procedures, Ross M. Keiser

Pace Law Review

No abstract provided.

Bitcoin Searches And Preserving The Third-Party Doctrine, Christine A. Cortez

St. Mary's Law Journal

Abstract forthcoming.

A Tale Of Two Regulators: Antitrust Implications Of Progressive Decentralization In Blockchain Platforms, Evan Miller

Washington and Lee Law Review Online

Competition regulators have identified the potential for blockchain technology to disrupt traditional sponsor-led platforms, like app stores, that have received increased antitrust scrutiny. Enforcement actions by securities regulators, however, have forced blockchain-based platforms to adopt a strategy of progressive decentralization, delaying decentralization objectives in favor of the centralized model that competition regulators hope they will disrupt. This regulatory tension, and the implications for blockchain’s procompetitive potential, have yet to be explored. This Article first identifies the origin of this tension and its consequences through a competition law lens, and then recommends that competition regulators account for this tension in monitoring …

Blockchain Emergencies & Open-Source Software Governance: Is "Rough Consensus" A Suicide Pact?, Blockchain Emergencies & Open-Source Software Governance: Is "Rough Consensus" A Suicide Pact?, Angela Walch

Faculty Articles

I am concerned with, "How is Bitcoin run? Who gets to make decisions about Bitcoin? How is Ethereum run? Who gets to make decisions about Ethereum?" I am concerned with the governance of these protocols at the base level. Why does this matter? It matters because these protocols at the base are supporting the whole DeFi structure. All the complexities and different complex financial products that are being built there, they sit on top of these infrastructural base level protocols. I think we need to be aware of how these things work and the systemic risks that they can pose …

Congress, Don't Rush Regulating Crypto (Opinion), Angela Walch

Faculty Articles

A sprawling infrastructure bill is the wrong venue for regulating an industry as complex and systemically important as crypto.

Tragedy Of The Energy Commons: How Government Regulation Can Help Mitigate The Environmental And Public Health Consequences Of Cryptocurrency Mining, Jeff Thomson

Seattle Journal of Technology, Environmental & Innovation Law

The use of cryptocurrencies in daily life has continued to rise over the last decade and shows no signs of slowing down. Although cryptocurrencies, such as Bitcoin, provide numerous tangible benefits to society, the process of mining these cryptocurrencies is extremely energy intensive. Accordingly, a tragedy of the energy commons has resulted whereby the monetary incentive to mine cryptocurrencies has distorted our collective ability to care for our shared energy resources. The current system allows for industrious individuals to set up cryptocurrency mines in regions that have access to plentiful and cheap energy sources, utilize this energy to power their …

Does Bitcoin Use Affect Crime Rates?, Kevin Keane

The Corinthian

Bitcoin is the most widely used cryptocurrency in the world because of its decentralized network that completes user-to-user transactions, eliminating the need for intermediaries. During 2017, the volume of Bitcoin transactions totaled $94.3 trillion. Bitcoin transactions are recorded in a public database called the blockchain. Although the blockchain can keep track of how many transactions there are, it can’t identify the people involved in transactions. The lack of identity increases the anonymity of Bitcoin transactions, making it less detectable when used for crime. Using the Uniform Crime Reporting’s state-level crime rate data and blockchain’s Bitcoin transaction information, I estimate the …

The Law Of Blockchain, Georgios Dimitropoulos

Washington Law Review

Blockchain technology is a new general-purpose technology that poses significant challenges to the existing state of law, economy, and society. Blockchain has one feature that makes it even more distinctive than other disruptive technologies: it is, by nature and design, global and transnational. Moreover, blockchain operates based on its own rules and principles that have a law-like quality. What may be called the lex cryptographia of blockchain has been designed based on a rational choice vision of human behavior. Blockchain adopts a framing derived from neoclassical economics, and instantiates it in a new machinery that implements rational choice paradigms using …

New Things Under The Sun: How The Cftc Is Using Virtual Currencies To Expand Its Jurisdiction, James Michael Blakemore

Arkansas Law Review

A decade has passed since Bitcoin solved a fundamental problem plaguing virtual currencies: How to ensure, without resort to financial intermediaries or other trusted central authorities, that a unit of digital currency can be spent only once. In that time, Bitcoin has inspired countless follow-on projects. Some have attempted to improve the technology’s potential use for digital cash, by, for example, increasing the number of transactions processed per second or improving user privacy. Others have strayed further from Bitcoin’s original intent, building on blockchain—Bitcoin’s central innovation—to enable distributed computing and so-called smart contracting, decentralized lending, governance, data storage, and digital …