Georgetown Law
Technology Review

Blockchain fever is hotter than ever. The World Economic Forum predicts that ten percent of global gross domestic product will be stored on blockchain by 2027,1WORLD ECON. FORUM, TECHNOLOGY TIPPING POINTS AND SOCIETAL IMPACT, SURVEY REPORT 24 (Sept. 2015). which has caused an unparalleled craze regarding blockchain’s possibilities.2WORLD ECON. FORUM, BLOCKCHAIN BEYOND THE HYPE: A PRACTICAL FRAMEWORK FOR BUSINESS LEADERS 3 (Apr. 2018) (“One of the most unique aspects of blockchain is its high number of evangelists – people who believe blockchain can solve everything from global financial inequality to access to financing for start-ups, the provision of ID for refugees, to solving supply chain problems and enabling people to sell their houses without needing an estate agent.”). Some see it as a new way of organizing modern-day society,3MELANIE SWAN, BLOCKCHAIN: BLUEPRINT FOR A NEW ECONOMY vii (O’Reilly Media 2015) (“[T]he blockchain concept is even more; it is a new organizing paradigm for the discovery, valuation, and transfer of all quanta (discrete units) of anything, and potentially for the coordination of all human activity at a much larger scale than has been possible before.”). while others fear the chaos that it could create.4On the idea that new technologies may, if not create chaos, generate losses, See LAWRENCE LESSIG, CODE: AND OTHER LAWS OF CYBERSPACE, VERSION 2 339 (Basic Books 2006) (ending his book by the following: “it is not a great time, culturally, to come across revolutionary technologies. We are no more ready for this revolution than the Soviets were ready for theirs. We, like they, have been caught by a revolution. But we, unlike they, have something to lose”). On the same subject, see also JONATHAN ZITTRAIN, THE FUTURE OF THE INTERNET—AND HOW TO STOP IT 242 (Yale University Press 2008) (“Traditional cyberlaw frameworks tend to see the Net as an intriguing force for chaos that might as well have popped out of nowhere. It is too easy to then shift attention to the ‘issues raised’ by the Net, usually by those threatened by it.”).There are skeptics5See Kai Stinchcombe, Ten Years In, Nobody Has Come Up with a Use for Blockchain, HACKER NOON (Dec. 23, 2017), https://hackernoon.com/ten-years-in-nobody-has-come- up-with-a-use-case-for-blockchain-ee98c180100 [http://perma.cc/8D5V-TV7E] (explaining that “ten years in, nobody has come up with a use for blockchain”). that deride blockchain as the new Netscape,6A technology which disappeared after being seen as very promising. while others see it as the most important innovation since the Internet.7See generally Lawrence Lessig, Keynote Address at the Sydney Blockchain Workshop:
Thinking Through Law & Code, Again, (Dec. 11, 2015). If the latter proves to be true, societies will radically change and so too must legal systems.
Western legal systems have historically helped establish trust between parties and reduce transactional uncertainty by providing recourse to legal procedures. Nonetheless, establishing trust still imposes significant transactional costs. Blockchain may reduce these costs to “a much, much smaller level”8Russ Roberts, Jim Epstein on Bitcoin, the Blockchain, and Freedom in Latin America,
ECON TALK (Feb. 13, 2017), http://www.econtalk.org/archives/2017/02/jim_epstein_on.html
[https://perma.cc/WAW6-ZFB7]. because it might make contracting easier and, on a broader scale, because it may alleviate widespread contractual inadequacy9Lin William Cong & Zhiguo He, Blockchain Disruption and Smart Contracts 4 (Dec.
27, 2018), https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2985764
[https://perma.cc/Z9QW-W7MA] (“[B]lockchains, via decentralized consensus, enable
agents to contract on delivery outcomes and automate contingent transfers. Hence, the
authentic entrant is now able to signal her authenticity fully. This eliminates information
asymmetry as a barrier for entry and greater competition, enhancing welfare and
consumer surplus in this blockchain world.”). by creating a world in which “computers . . . fill in the gaps of contracts.”10See Thibault Schrepel, Antitrust Conversations with Nobel Laureates, CONCURRENTIALISTE REV. (2018) (quoting Nobel prize winner Oliver D. Hart). Blockchain could then efficiently facilitate trade, but it also presents numerous legal challenges with substantial implications for antitrust law.

Continue Reading