SMART CONTRACTS: PROSPECTS FOR LEGAL REGULATION

Abstract

Abstract: The world is undergoing tremendous changes in connection with the transition to the information society. These changes lead to certain challenges that contract law faces.

The emergence of smart contracts, the transformation of the institution of fulfillment of obligations towards the automation of fulfillment are occurring due to the development of information technology, the Internet and electronic commerce. Factors such as distrust of the parties to each other, the desire to reduce the costs of the participation of intermediaries in transactions as well as the time to fulfill obligations and guarantee their fulfillment lead to the use of smart contracts.

At the same time, the concept of a smart contract and the peculiarities of its application are not reflected in the current legislation, which can create difficulties in practice. Thus, the parties that enter into a smart contract do not receive proper legal protection due to the lack of relevant provisions in the legislation. This also raises a question of what options are available to fulfill the obligations from a smart contract.

The purpose of this paper is to study theoretical and practical problems of legal regulation of smart contracts and review the legal consolidation of smart contracts in UK legislation as part of the regulation of digital financial assets. This paper analyzes the concept of a smart contract as well as the general possibilities for smart contract adoption in the United Kingdom's contractual practice. In addition, the legal challenges surrounding the use of smart contracts are examined.