According to the Law Commission, the statutory body of the United Kingdom, digital assets are playing an increasingly important role in modern society and, as such, the law relating to them must be reviewed. Reforming the laws will not only protect users’ rights and maximize the potential of digital assets, but can potentially position England and Wales “as a global hub for digital assets”.
Several key areas still need to be reformed
British statutory body, the Law Commission has published a consultation document in which it proposes to reform the law relating to digital assets. The commission said the publication of the document followed a request from the government asking it “to review the law on digital assets, to ensure that it can accommodate them as they continue to evolve and grow”.
In a recently released statement, the Law Commission acknowledged that digital assets are “playing an increasingly important role in modern society.” Therefore, there is a need to develop laws that allow “a more diverse range of people, groups and businesses to interact and benefit online”.
While acknowledging that England and Wales have already taken steps to adapt to emerging technologies such as cryptocurrencies and non-fungible tokens (NFTs), the commission asserted that there are “several areas keys” of the law which still need to be reformed. Such reforms will “protect user rights and maximize the potential of digital assets.”
Commenting on the commission’s proposals, Sarah Green, Law Commissioner for Commercial and Common Law, said:
Digital assets such as NFTs and other crypto-tokens have evolved and proliferated at high speed, so it is essential that our laws are adaptable enough to accommodate them. Our proposals aim to create a strong legal framework that offers greater consistency and protection to users and fosters an environment capable of further encouraging technological innovation.
Developing the right legal foundations
Green also stressed the importance of directing the commission’s efforts toward “developing the right legal foundations to support these emerging technologies.” She suggested that the commission should avoid rushing to impose a regulatory regime, as this could have the unintended consequence of stifling further development of these technologies.
By doing so, England and Wales “could reap the potential rewards and position itself as a global hub for digital assets”. Meanwhile, in the statement, the Law Commission said those wishing to provide feedback to it must do so by November 4.
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