Lehmann on Digital Assets in the Conflict of Laws

Matthias Lehmann (University of Vienna and Radboud University Nijmegen) has made available on SSRN the article on Digital Assets in The Conflict of Laws: A Comparative Search for the Ideal Rule that is being published on Singapore Journal of Legal Studies 2024.

The abstract of the article reads as follows:

Which law applies to private disputes over assets recorded on the blockchain, such as Bitcoin, Ether or stablecoins? This question has long eluded legal academia and practice. Now, states have begun to enact hard and fast rules. This contribution compares legislative provisions, soft law and judicial rulings in the US, England, Singapore, Germany, Liechtenstein, Spain, and Switzerland, and juxtaposes them to the recently adopted UNIDROIT Principles on Digital Assets and Private Law.

A careful analysis of these novel rules shows the emergence of a new gulf in the conflict of laws. The law governing digital assets is determined in different ways. This divergence risks undermining the functioning of the crypto economy even further. That is why this gap must be overcome before the differences are further entrenched and reciprocated by the laws of those states which have not yet regulated the question. The means to do so is a uniform text of conflict of laws.

Mindful of the need for conflict-of-laws unification, an attempt will be made to distill an ‘ideal’ conflicts rule for digital assets from the various national and international approaches. This results in an exact proposal of how an ideal rule could look like. It can serve as a blueprint for national legislation or case law. The hope is that this suggestion will lead to a worldwide consensus in determining the law applicable to digital assets.