Who decides what terms apply to Blockchain?

hands-2088954_1920Companies are finding interesting uses for blockchain. Wave is seeking to simplify maritime trade established over hundreds of years. In place of bills of lading other transitional documents, they propose a secure online blockchain mechanism to buy and sell goods. This might even reduce maritime litigation but only if it addresses key issues like late delivery and damaged goods.

Another example is Warranteer. It offers an automated tracker of customer warranties for products (although at the time of writing their website is down). It can let you know the number of warranty claims made against a product and whether the coverage has got better or worse recently. You can then decide whether to buy in the first place. It can even remind you when your warranty is about to expire. It’s aimed at the B2C market now but it’s not hard to see the B2B applications.

Blockchain raises the prospect of smart contracts

Blockchain raises the prospect of smart contracts. Imagine if your insurance policy could automatically pay out. For example, a farmer’s drought policy could independently verify there has been low rainfall and automatically compensate the farmer. Real estate transactions could become simpler by recording the transaction history reducing the need for investigation of the title. Anyone who has bought a house in the UK and suffered the delays while searches are done and information is gathered will be glad to have the process speeded up. Blockchain could also It could give a digital footprint for physical products such as jewellery or art reducing fraud and counterfeiting. Maybe it could monitor cloud availability and automatically trigger service credit calculations and payouts? And because blockchain is (supposedly) secure, it’s also reliable and safe.

Who decides what terms apply?

But who decides what terms apply to each transaction? Does the first transaction set the boundaries? What if someone down the line doesn’t agree to the terms and wants to impose his own? Are they stuck with the first set of terms or could they change the terms from that point? At least variations would become part of the blockchain history too. If it’s an international transaction, which country’s courts would hear the dispute? Could you specify an international arbitration upfront? Or could that be changed later too?

These are some of the difficult legal questions that need to be answered for blockchain to flourish.

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