Skip to main content

The State Of Illinois Legalizes Blockchain-Based Smart Contracts


The US State of Illinois made a massive step towards further blockchain adoption. According to the Blockchain Technology Act, which took effect on January 1st, blockchain-based smart contracts satisfy the law under certain circumstances.

 Smart Contracts Admissible In Court
One of the biggest challenges in front of regulators when it comes to crafting legislation for the cryptocurrency field is definitions. The SEC, for instance, has been struggling for quite some time before stating that Bitcoin and Ether (ETH) are not considered securities, while other digital assets launched in Initial Coin Offerings, for instance, pertain to that definition.
The State of Illinois, however, has made a serious step towards regulating blockchain-based technologies with the Blockchain Technology Act.
The bill, which is sponsored by Rep. Keith Wheeler, took effect on January 1st, 2020, and one of the first things that it addresses is the very definition for blockchain itself.
“Blockchain means an electronic record created by the use of a decentralized method by multiple parties to verify and store a digital record of transactions which is secured by the use of a cryptographic hash of previous transaction information.” – Reads the document.
More interestingly, the bill also provides definitions for cryptographic hashes, electronic records, and smart contracts.
Going further, the bill also stipulates that “a smart contract, record, or signature may not be denied legal effect or enforceability solely because a blockchain was used to create, store, or verify the smart contract, record, or signature.” It adds that the submission of a blockchain-based smart contract that electronically contains the record satisfies the law if it requires that document to be in writing.

In other words, smart contracts are now admissible in court, and they can be used to prove merit or to claim enforceability. This is undoubtedly a massive step towards further adoption.
China Already Ahead
While this may seem like a serious legislative breakthrough for the US, it’s worth noting that China is already far ahead in this regard.
Back in 2018, the Internet Court of Hangzhou confirmed that a defendant could use Blockchain to prove innocence
As it was translated by Katherine Wu, the court opined that when an issue involves blockchain technology, “an open and neutral attitude must be adopted.”
In any case, it remains interesting to see how this Act in the state of Illinois will be put into practice and whether or not it will pose additional challenges.

Comments

Post a Comment

Popular posts from this blog

Bitcoin Hash Rate Hits All-Time High: Here’s How It Works And How It Affects The Price

Bitcoin intelligence, data, and analytics firm Glassnode found the Bitcoin hash rate hit a new all-time high over the weekend, ten days before the Bitcoin halving event. In other words, miners are putting more computational power into maintaining the Bitcoin network. Because miners must venture electricity and capital intensive computer processors to mine Bitcoin, the increase in hash rate is a bullish sign. It means miners are after the Bitcoin rewards they get from maintaining the network. And they’re venturing the resources to go after those rewards. Is The Bitcoin Hash Rate Correlated With The Price? In general, the Bitcoin price and the hash rate are not correlated. The price is what buyers and sellers agree to pay for one Bitcoin, and there are many factors – external and internal – affecting the price. However, there is a relation between the two. While the price goes up, it’s more profitable to mine, which likely to cause more miners to turn on their mining equ...
Post a Comment
Read more

IN THE NEW DECADE, CRYPTO WILL BECOME ESSENTIAL LIKE EMAIL: SAYS TYLER WINKLEVOSS

It’s the start of a new decade, and industry famous twin Tyler Winklevoss, the co-founder, and CEO of cryptocurrency exchange and custodian company Gemini Trust, has shared his views on what the next ten years hold for crypto. According to Winklevoss, crypto is already becoming more than a niche technology and a form of money, and it will play an essential role in our daily life in the foreseeable future. “Today, crypto is still a niche technology and a form of money. It is not crucial to your everyday life the way email and other web applications are, but our thesis is that this will change — it’s already changing if you look close enough,” Winklevoss wrote. Winklevoss added that the decentralized nature of cryptocurrencies, which empowers individuals, will be the driving force within the new decade. Crypto will not only redesign the internet but will also redesign the financial and monetary systems to protect the rights and dignity of users, he said. The Winklevos...
Post a Comment
Read more

Qatar Blocks Cryptocurrency Services Throughout The Gulf

As the new year begins, Qatar’s Financial Center, the nation’s regulatory authority, has issued a blanket ban on cryptocurrency-related services in the Gulf nation. The prohibition covers not only cryptocurrencies but “anything of value” that could substitute fiat currencies. Qatar Bans Cryptocurrencies The Qatari Financial Center, which is also the nation’s regulatory authority, has issued a statewide ban on cryptocurrencies and other digital assets that might substitute traditional fiat. Per the report , the authority stated that: “Virtual Asset Services may not be conducted in or from the QFC at this time.” It also reads that this goes for “Anything of value that acts as a substitute for currency, that can be digitally traded or transferred and can be used for payment or investment purposes.” However, it’s also worth noting that the ban doesn’t cover digital forms of securities or other financial instruments that are thoroughly regulated by the Regulatory Authority, ...
Post a Comment
Read more