Today, European law firm Fieldfisher launches a paper on 'Blockchain – an introduction to one of the most significant technological developments in recent years.' This guide looks at the range of ways blockchain is being used at the moment, its potential and future, but also the legal issues that it raises.
The technology itself is still relatively new but is quickly being adopted by some of the largest banking businesses, with The World Economic Forum predicting that it will become the "beating heart" of the banking system. And certain regulators are setting up a 'legal sandbox' that allows a regulatory-light environment in which to use the technology.
One of the benefits of blockchain is that it can in the right circumstances operate as an excellent proof of ownership and in many ways is more resistant to fraud and to hacking than traditional ways of evidencing title.
But as with many technological innovations it does come with legal concerns, which are outlined in the paper.
Robert Shooter, a partner and Head of the Technology, Outsourcing and Privacy group at Fieldfisher says, "The jury is still out as to whether blockchain is the next big thing - quite aside from the legal and regulatory concerns, the main players are still experimenting with viable user cases".
Nicholas Thompsell, a partner in financial services continues, "Whilst we have seen businesses excited about the prospect of the new technology, the current lack of regulation on the blockchain and legal recognition for blockchain concepts currently constrains firms in how far they can make use of the technology. There certainly is a need for more legal clarity".
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