Smart contracts are a great technological evolution, but questions regarding their validity remain. For example, are smart contracts even legally binding in their current state? The answer to that lingering question may surprise some people. A new whitepaper created by R3 and Norton Rose Fulbright sheds some light on this topic.
The Legality of Smart Contracts In The Real World
Cryptocurrency enthusiasts are well aware of what smart contracts bring to the table. Other than automation and improved transparency, this technology allows for autonomous business models. But if things go awry, is it even possible to hold the participant of a smart contract responsible? A big question that deserves a thorough answer. The recently published whitepaper by R3 and Norton Rose Fulbright provides some valuable insights.
Going by the “code is contract” approach, the answer would be affirmative. However, there is a large set of variables that needs to be taken into account before such a contract can become legally binding. Just because “contract” is in the original term does not mean it is automatically binding. Instead, it serves as an agreement between parties subject to a factual matrix within which