Keep up with the latest developments and legal issues in the telecommunications and emerging technology sectors, with exclusive access to a comprehensive collection of telecommunications law news,...
Large law firms are serving as the de facto regulators of still-evolving blockchain technology applications while government enforcement agencies and industry best practices catch up, Vinay Gupta, CEO of Mattereum.com, told Bloomberg Law.
The London-based executive said law firms are on the front lines of figuring out legal questions surrounding the technology, which is being implemented in legal contracts, equity instruments, and many other areas. It may take another five to 10 years of technical development before blockchains and their related cryptocurrencies, coins, and tokens can be more precisely regulated, Gupta said in a recent video interview.
“It’s the beginning of a process, and everybody knows that we’re going to see years and years and years of technological innovation, all of which will have to be kind of factored into regulation and legal practice,” Gupta told Bloomberg Law.
Blockchain platforms allow multiple parties that don’t necessarily need to trust one another to make transactions in real time without the need for an intermediary, like a bank or government. Transactions are recorded on a transparent, auditable database chain that is designed to resist collusion or hacking.
Gupta focused on the potentially sweeping benefits of blockchain technology, especially in opening new paths to funding startups through digital tokens and cryptocurrencies.
In 2017, the use of initial coin offerings, or ICOs, exploded as a way for individuals and companies to raise funds, similar to an initial public offering or crowdfunding campaign, by selling digital coins or tokens on a blockchain. But fraudulent token developers, drawn to the markets, have tried to sell tokens without complying with securities rules, or by offering bogus services.
Gupta, who has a global perspective on blockchain development in government and industry, helped coordinate the 2015 release of Ethereum, a now internationally known blockchain that has been used to launch hundreds of new cryptocurrencies, tokens and applications and allowed entrepreneurs to raise billions of dollars. He serves on the U.K.-funded innovation initiative Digital Catapult and runs the funding firm Hexayurt Capital as well as Mattereum.com, both projects advancing the use of blockchain-enabled legal agreements, or smart contracts.
Gupta, who also helped design the blockchain strategy for the city of Dubai, which aims to be the world’s first blockchain-powered government, suggested a new regulatory model that allows engineers or computer scientists to qualify as accredited investors. That way, technically knowledgeable individuals could help root out fraudulent schemes and focus investment dollars on the most promising innovations, even if they are difficult for traditional venture capitalists to understand.
To contact the reporter on this story: Michaela Ross in Washington at email@example.com
To contact the editor responsible for this story: Keith Perine at firstname.lastname@example.org
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)