Home Economy Bitcoin : Podcast 3: The legal aspect of DeFi Bitcoin : Podcast 3: The legal aspect of DeFi September 5, 2020
To end this series on decentralized finance (DeFi), we take stock of its legal aspect.We talk about it in the podcast: Small point on the terms used in this episode
NFT Token : Non-fungible token, with its own identity; We talk about it here Stablecoins: Stable tokens, which often follow the price of the US dollar RealT: Real estate tokenization project
To deepen the exchange What risk for those who take advantage of DeFi’s flaws? Is this really illegal, because ” Code is Law “?
On the criminal level, it is theft.The offense of hacking, or even money laundering, can also be qualified.On the civil level, the user and the platform are entitled to obtain full compensation for their damage.
By rereading Lawrence Lessig, we understand that ” Code is Law ”Does not designate the replacement of law by the code, but a philosophical reflection on the reconciliation between their respective powers.I stop here, but it is not at all a libertarian theory as we sometimes hear it.Can the creators of these smart contracts / protocols be prosecuted?
In principle, everyone is responsible for the damage it causes.In practice, the way in which the service is offered is of paramount importance (ie it is the service which gives access to the protocol which will be continued).
Apart from cases of willful misconduct, liability may be based on profit (commission, income, data collection, etc.) and / or on the risks that the service poses to its users.
Conversely, the free and open provision of the computer code (free software) does not, in the vast majority of cases, engage the responsibility of its author.
Finally, consumer law will also apply, placing a significant number of obligations on the service provider.And what about the legal value of audits of certain smart contracts?
Legally, these audits have the value that users give them.
The regulations may provide otherwise: as part of the authorization procedure for a Service Provider on Digital Assets (PSAN), eligible services may be required to have ANSSI certification.
Suddenly, can insurance really help if the system is not supervised?
We are far from it insofar as European insurance does not even cover the simple conservation of Bitcoin …
As for banks, several obstacles remain: a still modest market size in the face of technical constraints – how to quantify the risks and control the environment of cryptocurrencies (smart contract, multisig, etc.)? – and regulatory – KYC / AML, compliance rules – very strong.
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See you on the episode bonus , to find out about the latest DeFi tips.
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About the Author : Valentin Demé Passionate about Blockchain technology and crypto currencies, I am the voice of the Cryptoast podcast.I also work alongside the editorial staff of Ouest-France, as a culture correspondent.All articles by Valentin Demé.Related Posts.