Arbitrating Disputes Involving Blockchains, Smart Contracts and Smart Legal Contracts, Dispute Resolution Journal, October 2020, Vol. 74, No. 4, pages 89-133.
October 28, 2020
Blockchain-based distributed ledgers (“Blockchain Ledgers”) provide an immutable, secure, and tamper evident alternative to conventional transactional modalities, one which also yields enhanced accountability, traceability, and transparency. The inherent benefits, and hence growing adoption of, Blockchain Ledgers, Smart Contracts, and quite recently Smart Legal Contracts (the latter two being built on blockchains), across a wide range of the economy, has caused and is now accelerating a fundamental paradigm shift that, in certain sectors of society, is increasingly displacing traditional written and oral contracts in favor of automatically executing blockchain-implemented agreements. This paper offers a short historical background of the societal need underlying blockchains; describes, at a high level, the technological basis of blockchains, smart agreements and smart legal agreements; addresses various legal issues and disputes that are likely to arise; and discusses the use and advantages of arbitration, as the only viable approach, for resolving those disputes.