EU Data Act Ignores Blockchain Industry Pleas, Potentially Making Smart Contracts Unlawful
A final version of the new European Union Data Act has largely ignored pleas from the blockchain industry, raising concerns that it could render most smart contracts unlawful. The text of the law, seen by CoinDesk, reveals that provisions aimed at safely terminating automated data-sharing agreements still broadly refer to “smart contracts,” rather than the industry’s preferred term of “digital contracts.” Lobbyists had hoped that the law would be limited to privately owned and permissioned data records. Additionally, the text places responsibilities on the “vendors” of the automated programs, potentially imposing unwarranted accountability in decentralized cases. The law’s scope also appears to be wider than what lobbyists had requested, as it does not specifically mention private or permissioned networks.
Key Points:
- The final version of the EU Data Act disregards pleas from the blockchain industry.
- Provisions regarding the termination of data-sharing agreements still refer broadly to “smart contracts.”
- The law includes responsibilities for “vendors” of automated programs, potentially leading to limitless liability in decentralized cases.
- The law’s scope extends beyond what lobbyists had requested, as it does not specify private or permissioned networks.
- The text of the law must be agreed upon by the European Parliament and Council of the EU to become law.
Hot Take:
The EU Data Act’s failure to address concerns raised by the blockchain industry raises questions about its impact on the legality of smart contracts. The broad terminology used in the law and the imposition of responsibilities on vendors could hinder innovation in decentralized networks. While the law aims to regulate automated data-sharing agreements, its current form may have unintended consequences for the blockchain industry. It remains to be seen how the law will evolve during the legislative process and whether amendments will be made to address the concerns of industry stakeholders.
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