Legal Risks in the Application of Blockchain -Part 4

(2) Legal application level

The technological revolution in the era of intelligent Internet causes the existing legal system to face “broken window” challenges and “creative destruction”. The decentralized nature of blockchain makes its application a difficult problem at the legal level. Blockchain provides conditions for applications in various fields from a technical level including improving transaction efficiency, solving credit problems, as well as realizing value transfer. The use of blockchain in electronic deposit certificates can verify the authenticity of documents without requiring centralized authorization. However, the development of technology and the existing legal system have formed conflictsto a large extent. Problems that still have loopholes at the legal level like responsibility accountability after the occurrence of risks in conflict-related application fields, and the assurance of personal privacy and transaction security still need to be resolved.

In legal norms and system construction, on the one hand, in terms of the popularization of smart contracts, since contracts are compiled from code, they are convenient and efficient in application. However, once problems and loopholes occur, it is difficult to identify the relevantresponsible personnel and make up for changes. The determination of contract validity is a great risk point. Programming code can only identify data, but not the purpose and motivation of others. Even if there is a severemisunderstanding or fraud in the smart contract, or the two parties maliciously collude to damage the interests of the third party and the public interest, they cannot identify and terminate it.