The current rhetoric around the blockchain hints at problems with the techno-utopian ideologies that surround digital activism.
The 2017 paper A Cross-Sectional Overview of Cryptoasset Governance and Implications for Investors is a master’s thesis covering governance structures in the industry. It has a useful survey of the top 50 circulating cryptoassets by network value (as of July 29, 2017) with detailed analysis of the governance models on display. The paper is aimed at educating investors about the relative lack of shareholder (tokenholder) rights in the industry. It also discusses a few of the functioning models of cryptoasset governance.
To investigate the application of blockchain technology to address challenges in the digital advertising space and to develop standards and best practices for the utilization of blockchain technology.
At present, the working group is working on developing education for blockchain technology and its use in advertising. The members will work on setting priorities for business use cases and required technology standards and best practices.
Governance in Blockchain Technologies & Social Contract Theories
This paper is placed in the context of a growing number of social and political critiques of blockchain technologies. We focus on the supposed potential of blockchain technologies to transform political institutions that are central to contemporary human societies, such as money, property rights regimes, and systems of democratic governance. Our aim is to examine the way blockchain technologies canbring about – and justify – new models of governance. To do so, we draw on the philosophical works of Hobbes, Rousseau, and Rawls, analyzing blockchain governance in terms of contrasting social contract theories. We begin by comparing the justifications of blockchain governance offered by members of the blockchain developers’ community with the justifications of governance presented within social contract theories. We then examine the extent to which the model of governance offered by blockchain technologies reflects key governance themes and assumptions located within social contract theories, focusing on the notions of sovereignty, the initial situation, decentralization and distributive justice.
Crypto-Securities Regulation: ICOs, Token Sales and Cryptocurrencies under EU Financial Law
44 Pages Posted: 30 Nov 2017 Last revised: 13 Dec 2017
Date Written: November 22, 2017
Cryptocurrencies, such as bitcoin and ethereum, have not only risen to public attention as novel means of payments. Rather, the current hype is fueled by financial applications built on top of these currencies that stand to potentially upend consumer and investment markets. The most remarkable and economically relevant of these applications are tokens sold via initial coin offerings (ICOs, also called token sales). In 2017 alone, the equivalent of more than $ 3 billion have been raised through ICOs. In these entirely online-mediated offerings, startup entrepreneurs sell tokens registered on a blockchain in exchange for cryptocoins traded on that blockchain (typically bitcoins or ethers). Investors receive tokens that can be understood as cryptographically-secured coupons which embody a bundle of rights and obligations.
In July 2017, the SEC released an investigative report that highlighted that such tokens can be subject to the full scope of US securities regulation. As a result, issuers increasingly structure ICOs such as to prevent US citizens and residents from obtaining tokens in order to exclude the reach of US securities regulation. However, for the time being, EU citizens and residents are free to invest in tokens. This raises the question to what extent EU securities regulation is applicable to ICOs and, particularly, whether issuers have to publish and register a prospectus in order to avoid criminal and civil prospectus liability in the EU. In conceptual terms, this depends on whether tokens are considered “securities” under the EU prospectus regulation regime. The question is of great practical relevance since, despite the high stakes involving more than $100 million in some ICOs, to our knowledge, up to now not a single token issuer has published or registered any such prospectus.
Against this background, this paper develops a nuanced approach that distinguishes between three archetypes of tokens: currency, investment, and utility tokens. It analyzes the differential implications of each of these types, and their hybrid forms, for EU securities regulation. While the variety of tokens offered necessitates a case-by-case analysis, the discussion reveals that at least some types and hybrid forms of tokens are subject to EU securities regulation. By and large, pure investment tokens typically must be considered securities, while pure currency and utility tokens are exempted from securities regulation in the EU. In identifying these archetypes, regulation and market oversight will have to put substance over form. Finally, we spell out criteria for the application of EU securities regulation to hybrid token types.
The paper closes by offering two policy proposals to mitigate legal uncertainty concerning token sales. First, we suggest tailoring disclosure requirements to the code-driven nature of token sales. Such an ICO-specific safe harbor would offer a clear and less burdensome path to EU law compliance for token sellers who suspect that their tokens may qualify as securities. This only requires the Commission to amend its delegated 2004 Commission Prospectus Regulation. Second, we propose that, on an international level, governments form a compact to bestow certainty about the application of their respective securities regulation regimes to token sales. This is, first, to avoid regulatory overkill on the one and regulatory lacunae on the other hand in online-mediated, global token sales. Second, overlapping, and partially contradicting, securities regulation regimes can nullify each other. In the end, only a joint international regulatory regime can efficiently balance investor protection and investor access in the face of the novel generation of decentralized blockchain applications.
Keywords: blockchain, ICO, token sale, initial coin offering, bitcoin, ethereum, prospectus, EU law, smart contracts, DAO, utility token, investment token, safe harbor, cryptocurrencies
Blockchain and the European Union’s General Data Protection Regulation: A Chance to Harmonize International Data Flows
40 Pages Posted: 6 Dec 2017
Date Written: November 6, 2017
Future economic growth is dependent on global data sharing. With the EU’s GDPR going into effect May 25, 2018, data privacy law in the EU will be uniform in text. The GDPR applies extraterritorially to any organization that can reach the EU market in terms of access by an EU citizen. While a consistent and coordinated interpretation of the GDPR provides organizations with the requisite assurances needed when operating in an international environment, stricter standards and higher fines require the organizations to rethink their international privacy compliance protocols. Trust-failures in society are the driving force behind such comprehensive regulatory frameworks, but emerging technology like blockchain can aid in minimizing these privacy concerns. Among other things, blockchain properties include decentralization, authentication, confidentiality, accountability, and access control management. By treating data flows as transactions, blockchain applications can work with regulations to facilitate the secure transfer of information. The purpose of this paper is to begin a conversation around utilizing blockchain technology and reducing harmonizing regulations like the GDPR to an automated protocol.
Max Planck Institute for Innovation and Competition; University of Oxford
Date Written: August 7, 2017
Abstract: This paper examines the emergence of blockchain technology and evaluates regulatory techniques designed to regulate the technology in its early stages.
Keywords: Blockchain, Distributed Ledger, Smart Contract, Law, Regulation, Co-Regulation, Law & Technology, Innovation
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Exploring the Strategic Opportunities of Blockchain:FOR INDUSTRY TRANSFORMATION, COMPETITIVENESS, MANAGEMENT AND PUBLIC VALUEThe technology that will enable, secure and formalize the digital relationships shaping the future of enterprise, government and the global economy has arrived — Blockchain. The first generation of the digital revolution brought us the Internet of Information. The second generation—powered by blockchain technology—is bringing us the Internet of Value: a new, distributed platform that can help us create the digital relationships that will reshape the world of business and transform the old order of human affairs for the better.In the first best-selling book about the blockchain revolution, Don Tapscott and Alex Tapscott argued that blockchain technology will transform financial services, the deep architecture of the corporation, animate the Internet of Things, recast the role of government, revamp our content industries, and solve important problems like the security of organizations and the privacy of individuals. New blockchain-based business models will transform most industries, and big disruptors may themselves become disrupted.It’s now time to take the next step and conduct deep research into killer applications — identifying the most important opportunities for blockchain in business and government and drawing the roadmap for how to get there.
Professor Karen YeungProfessor of LawStart date at Kings: 1/09/2006Contact details:Telephone: +44 (0)20 7848 1550E-mail: email@example.comDepartmentLawsResearch interestsRegulation and governance; the regulatory state, regulatory institutions and instruments, regulating technology, design-based instrumentsLatest Research OutputsThe Forms and Limits of Choice Architecture as a Tool of GovernmentYeung, K. 15 Jul 2016 In : Law and Policy.ArticleHypernudge: Big Data as a mode of regulation by designYeung, K. 22 May 2016 In : Information Communication & Society. 20, 1, p. 118-136ArticlePublic Health Interventions as Regulatory GovernanceYeung, K. 3 May 2016 In : Public Health Ethics. p. 1-2Comment/debate‘Law, Regulation and Technology: the Field, Frame and Focal QuestionsScotford, E. A. K., Brownsword, R. & Yeung, K. 2016 Oxford Handbook of Law, Regulation and Technology. OUPChapter
UCL Roberts Building, Malet Place, London WC1Organised by the UCL Centre for Law, Economics and Society with the support of the Modern Law Review and UCL Public EngagementThe workshop deals with emergent economic, political and legal phenomena in the field of FinTech. It pursues two distinct goals. First, it intends to generate awareness and facilitate a better understanding of the actors, phenomena and dynamics of the new financial order. Second, it explores the political and legal implications of financial and technological innovation based on blockchain technology. These debates will constitute the basis of an edited volume that introduces practitioners and researchers to the regulatory and political challenges of blockchain technologies and its diverse uses.The Speakers include:Tomaso Aste (UCL)Iris Chiu (UCL)Georgios Dimitropoulos (Hamad Bin Khalifa University Law School)Stefan Eich (Princeton Society of Fellows)Hermann Elendner (Humboldt University of Berlin)Jonathan Greenacre (Oxford University)Rohan Grey (Modern Money Network)Philipp Hacker (EUI)Michael Jacobides (London Business School and NY Fed)Rosa María Lastra (Queen Mary University of London)Ioannis Lianos (UCL)Pietro Ortolani (Max Planck Institute Luxembourg)Giovanni Sartor (European University Institute)Alexandros Seretakis (University of Luxembourg)Paolo Tasca (UCL)Angela Walch (St. Mary’s University School of Law)Aaron J. Wright (Cardozo School of Law)Karen Yeung (King’s College London)Claus D. Zimmermann (Sidley Austin LLP)