Thammasat University students interested in law, business, economics, and related subjects may find it useful to participate in a free 28 November Zoom book talk on Blockchain Regulation and Governance in Europe.

The event, on Tuesday, 28 November 2023 at 4:30pm Bangkok time, is organized by the Faculty of Law, The University of Hong Kong (HKU).

The TU Library collection includes several books about different aspects of blockchain technology.

The speaker will be Professor Michèle Finck who teaches law and artificial intelligence at the University of Tübingen, Germany.

Students are invited to register for the event at this link:

https://hkuems1.hku.hk/hkuems/ec_regform.aspx?guest=Y&UEID=90614

With any questions or for further information, please write to

aiiflhku@hku.hk

The book by Professor Finck, Blockchain Regulation and Governance in Europe, is available to TU students through the TU Library Interlibrary Loan (ILL) service.

The event website notes:

In Blockchain Regulation and Governance in Europe, Michèle Finck examines the relationship between blockchain technology and EU law and introduces the theme of blockchain governance. The book provides a general introduction to blockchains as both a regulatable and a regulatory technology and outlines the interaction between distributed ledger technology and specific areas of EU law, such as the General Data Protection Regulation. It should be read by anyone interested in EU law, the relationship between law, innovation and technology, and technology governance.

As TU students know, blockchain technology is an advanced database mechanism that allows transparent information sharing within a business network.

A blockchain database stores data in blocks that are linked together in a chain.

The data is chronologically consistent because the chain cannot be deleted or modified without agreement from the network.

As a result, blockchain technology may be used to create an unchangeable ledger to track orders, payments, accounts, and other transactions.

The system has built-in mechanisms that prevent unauthorized transaction entries and create consistency in the shared view of these transactions.

Traditional database technologies present challenges for recording financial transactions. Individuals may claim falsely that they have paid a debt or received payment.

Blockchain resolves such issues by creating a decentralized, tamper-proof system to record transactions.

Professor Finck wrote in an article for the German Law Journal posted online:

“Blockchain” is the word on the street in the technology and business worlds right now. It first emerged as the technology enabling the emergence of the Bitcoin cryptocurrency but has since acquired independent significance as developers around the globe rely on the tool to create a wide range of applications. Termed the “new Internet” or “the Internet of value,” blockchain promises to anchor innovative solutions in multiple domains of business and life.

The technology remains in its very early stages of development and there can be no doubt that many of the current blockchain projects and start-ups are eventually doomed to fail.

There is moreover no way of knowing whether the technology itself, which suffers from considerable limitations, will be able to mature to a degree enabling these applications.

Many are however certain that blockchain technology and its transformative influences are here to stay. With that development, many questions—which are to be approached from an interdisciplinary perspective—emerge. For lawyers, the challenge consists of identifying the legal, policy, and strategic implications of blockchain technology. Many of these aspects will crystallize as the technology and its use cases continue to unfold. Its precise future cannot be predicted so that policy-makers are essentially asked to regulate uncertainty. It is nonetheless not premature to map the regulatory and governance challenges that have already emerged and ponder possible solutions. This is particularly so as this an in and of itself neutral technology that will not however be used in a neutral manner. Rather, distributed ledgers can be used for good and malicious ends.

This is the task which this Article addresses. This Article will briefly introduce the technology and current projects before presenting a typology of regulatory approaches that have been adopted to date. Drawing on early experience and past instances of technological innovation, the Article suggests that regulatory debates ought to accompany the technology from its early stages. While regulators must be careful not to stifle innovation nor repeat some of the mistakes of Internet governance, regulation amounts to a tool providing certainty for those involved in blockchain development. This can ultimately benefit, rather than restrict, innovation.

Blockchain, while itself presenting the capacity to regulate self and others, also hinges on a stable regulatory framework. The development of blockchain technology will in no small part depend on the regulatory framework within which it occurs. This is not to say, however, that a heavy regulatory hand ought to regulate the technology in every detail. Rather, flexible and open approaches are needed. Indeed, as technology develops, so must law. With this in mind, I suggest that a co-regulatory approach accounting for the specificities of the technology should be deployed to create the certainty and stability needed to sophisticate and mature blockchains while respecting the public interest objectives regulators are designed to safeguard. This will hopefully provide guidance to those concerned with blockchain regulation, but also more broadly stimulate debate on the relationship between law and technological innovation. As we live in an age where new applications emerge with increased frequency and pace, this question is indeed one of general application.

The arguments outlined above will unfold in several parts. First, I introduce blockchain technology, including key concepts and terminology. Second, I shall explore the implications of this wave of technological development in introducing possible use cases. Third, I note that regulators ought to be involved from the early stages of blockchain development. Finally, these observations will lead me to conclude that early-stage regulatory discussions are necessary to accompany blockchains’ development as they provide legal certainty for innovators and early adopters and allow for public interest objectives to be protected. In light of the fast pace of development in these areas it should be noted that this article takes into account developments up until summer 2017. Its aim is to provide a starting point for further analysis and discussion rather than comprehensive analysis. […]

Conclusion

Despite the buzz surrounding blockchain, it is important to not lose out of sight that blockchain remains at the very early stages of its development, faced with challenges of scalability, maturity, performance, privacy, security, and, as of now, also wide-spread adoption. It needs time and experience to develop and this is a key realization that should guide any regulatory action. Yet, looking at the speed of innovation and more recently also adoption of blockchain technology, this technology is not to be written off as emerging only in the long-term. Rather, given the rate of accelerated innovation that can be observed.

Regulators should not wait to converse with the industry until blockchain is fully mature. Rather, innovators and regulators should collaborate already at this stage to facilitate innovation beneficial to all. Blockchain is a malleable tool and how we frame it, including from a regulatory perspective, will be key. There also needs to be awareness on behalf of all actors involved in the system that setbacks will naturally occur. Early applications of blockchain are at least in part overhyped but that does not mean that the technology is in itself. As with every technology the turning point of adoption comes when opportunities are considered to outweigh risks. When that happens, technology and industry are ready to go and the regulatory framework should be too.

(All images courtesy of Wikimedia Commons)