Thomas Daniels
The Law Commission of England and Wales has embarked on a consultation process to explore the idea of recognizing cryptocurrencies and NFTs (non-fungible tokens) as forms of property under proposed new laws.
In a statement by the independent statutory body, it was highlighted that there is potential for crypto tokens and NFTs to be granted property rights. The commission is inviting responses from the public until March 22 to advance this proposal.
The commission emphasized the critical role of property rights in scenarios such as bankruptcy or illegal interventions, pointing out the distinct challenges posed by digital assets. Digital assets, which differ from traditional tangible assets or those based on rights like debts and financial securities, challenge the traditional categories of personal property, prompting a reevaluation of the current legal frameworks.
This inquiry is part of the Law Commission’s broader project on digital assets and electronic trade documents under private international law, with a deadline for feedback set for May 16.
Sarah Green, the commissioner responsible for commercial and common law, mentioned that the digital and decentralized nature of these assets creates significant challenges for the existing mechanisms of private international law in resolving issues of jurisdiction and legal disputes.
The objective of the consultation is to collect insights on the experiences and challenges encountered in commercial and legal practices related to digital assets and electronic trade documents.
The feedback gathered will inform the final draft of the legislation concerning the recognition of crypto as property, which will then be considered by the government. This process is also expected to contribute to future legal reforms, especially following the recent introduction of the Electronic Trade Document Act, which supports the digitization of trade documents in the UK.
