The Current And Future Implications Of Cryptocurrency For The Legal Industry
One of the features of cryptocurrency that’s often touted as a benefit by its many supporters is its lack of regulation, relatively speaking. Blockchain technology has given us the means to cut out the middlemen (banks and governments) in peer-to-peer transactions. It’s also arguable that legislators should increase their regulation, but that hasn’t prevented a number of legal issues from arising.
Just last month, Canada’s largest cryptocurrency exchange, QuadrigaCX, closed following the unexpected death of its chief executive. When Ernst & Young accessed the cold wallets of the deceased CEO that were supposed to have $150 million in cryptocurrencies, they found that five of the six wallets were empty and the sixth contained a fraction of the missing millions.
Any system that is administered even in part by people is likely to be fallible on some level, and the inevitable consequence is legal action.
Legal Issues Surrounding Cryptocurrency
The emergence of cryptocurrency and blockchain in recent years has provided companies, as well as private investors, many exciting opportunities. However, these benefits often come with a generous slice of risk. Despite being around for a decade, cryptocurrency still operates in largely uncharted international legal territory because many of the legal frameworks that are now tasked with regulating cryptocurrency were written before things such as cryptocurrency existed.
I frequently see clients and potential cryptocurrency investors trying to navigate these legal issues. With collective experience spanning international exchange, SEC regulations and compliance, our law group has worked with clients all throughout the evolution of cryptocurrency in the past few years. We have seen a number of legal issues arise relating to cryptocurrency, as well as the technology that supports it. These include:
• The legal rights and obligations of corporate and private individuals
• Contractual issues -- primarily focused on breach of contract
Co-Founder of ICO Law Group, and a professional in cryptocurrency market analysis and measurement of it's regulatory enviroment.