Note: BEYOND BITCOIN:
ISSUES IN REGULATING BLOCKCHAIN TRANSACTIONS

Trevor I. Kiviat +

Abstract
 

 
The buzz surrounding Bitcoin has reached a fever pitch. Yet in academic legal discussions, disproportionate emphasis is placed on bitcoins (that is, virtual currency), and little mention is made of blockchain technology - the true innovation behind the Bitcoin protocol. Simply, blockchain technology solves an elusive networking problem by enabling "trustless" transactions: value exchanges over computer networks that can be verified, monitored, and enforced without central institutions (for example, banks). This has broad implications for how we transact over electronic networks.

This Note integrates current research from leading computer scientists and cryptographers to elevate the legal community's understanding of blockchain technology and, ultimately, to inform policymakers and practitioners as they consider different regulatory schemes. An examination of the economic properties of a blockchain-based currency suggests the technology's true value lies in its potential to facilitate more efficient digital-asset transfers. For example, applications of special interest to the legal community include more efficient document and authorship verification, title transfers, and contract enforcement. Though a regulatory patchwork around virtual currencies has begun to form, its careful analysis reveals much uncertainty with respect to these alternative applications.
 

 
The circulation of confidence is better than the circulation of money.
 

 
- James Madison ¹
 


Introduction
 
On December 26, 2014, three million homes nationwide tuned in to watch the North Carolina State Wolfpack take on the University of Central Florida Knights in the Bitcoin St. Petersburg Bowl - the first of several bitcoin-branded, postseason college bowl games. ² ESPN's online presale, held open ...