When it was invented in 2008, blockchain was intended to serve as an open and accessible record for transactions using the cryptocurrency bitcoin. Before long, other cryptocurrencies began to utilize blockchain, and advocates for the technology hail it as the ultimate democratic system, as it is available to anyone. As blockchain and cryptocurrency rise in popularity, the questions of how to regulate transactions and protect consumers have come to the fore.
On November 11, 2019, Fordham Law School’s inaugural Blockchain Regulatory Symposium brought together a diverse program to discuss various legal issues related to blockchain. “The willingness of individuals at the highest levels to engage in these dialogues and debates was really amazing ,” said Donna Redel ’95, one of the Symposium’s founders and organizers.
Speakers included respected securities lawyers, legal scholars, officials from the Securities and Exchange Commission, the Federal Trade Commission, and the Commodities Trading Commission as well as the 13-year-old entrepreneur George Weiksner, founder of Pocketful of Quarters, Inc., an innovative company that links cryptocurrency and gaming.
“Many of the blockchain conferences are marketing events,” Redel explained. Fordham’s willingness to host an event with an academic focus “shows the school’s commitment to being on the cutting edge and creating a forum for serious dialogue and debate,” she noted. “Because the event was under the auspices of the law school, participants were able to focus on really having an interactive conversation.
One such conversation was a roundtable entitled “At the Frontier of a Reimagined Legal Landscape.” Participants discussed how our current laws serve users of the burgeoning technology, as well as if—and how—existing law might need to adapt in order to spur greater innovation for the US to remain competitive
The event was held under the Chatham House Rule, which allowed panelists to have a freewheeling discussion where they would not be quoted for attribution.
The facilitators opened by introducing the concept of “smart contracts,” computer code that can enact all steps in the execution of a contract. Some particularly fervent blockchain evangelists claim that smart contracts could ultimately change the role of lawyers. The discussion centered on whether existing contract law needs to be updated for blockchain or if an entirely new body of law is needed. Several of the speakers conceded that lack of education on the new tech is one of the biggest issues facing lawyers working with blockchain or cryptocurrency. “How do we take the code and turn it into ethics that we can explain to a jury or to a judge?” one participant asked.
Many of the most appealing aspects of blockchain—its inherent democracy and its decentralized nature—also make it harder to understand and more difficult to regulate. “In a truly decentralized marketplace, who’s accountable?” asked a roundtable participant. Many of the speakers also agreed that for a so-called democratic currency, blockchain can prove to be incredibly opaque to the average consumer. “The idea that blockchain is somehow empowering for the unbanked or less sophisticated is misleading,” remarked one of the panelists. “It is far too complex for consumers—it is a backend technology.”
One speaker also pointed out that many other countries have established comprehensive regulatory schemes for blockchain and cryptocurrency, and to remain a player in the global field, the US would have to follow suit. To see how law adapts to the rise of blockchain, one of the discussion facilitators suggesting looking to the courts, where new rulings in blockchain-related cases could begin to set new precedents. “The more educated the judges are, the better the law will be,” she said.
Fordham Law’s Blockchain Symposium was presented with support from the Center on Law and Information Policy, the Corporate Law Center, the Blockchain Law Society, and the Wall Street Blockchain Alliance.