Smart contracts are a natural extension of blockchain technology. Even so, this technology is still in the early stages and prone to bugs and flaws. Over in Tennessee, the concept of smart contracts has now been legally recognized. This new bill was signed earlier this week, and is a pretty big development for the industry as a whole.
No one will deny smart contracts have a lot of potential. Even though they are far from perfect, it is evident the promise is certainly there. Coming up with new use cases for this technology is not all that difficult either. However, one has to wonder whether or not these contracts have any legal value. In Tennessee, they certainly do so now.
Legal Power for Smart Contracts
More specifically, a new law was signed this week. Governor Bill Haslam makes smart contracts legal in the entire state. That in itself is a rather surprising development. It is also the first time a US state effectively legalizes such technology through a bill or law. In Tennessee, this process has been going on for several months. Avoiding legal loopholes and such is always a bit tricky when it comes to blockchain.
It seems Tennessee will not be the only state legalizing smart contracts. Both Nebraska and Florida officials are contemplating similar measures. Making it legal to store data on a blockchain is a big development for the industry. Theoretically, it doesn’t need a law or bill, but it’s still nice to have regardless. Anyone is free to use blockchain technology as they see fit, for legal purposes.
With smart contracts now having legal power, an interesting situation is created. It may even force developers to improve their overall coding of smart contracts in general. Until the technology matures, legal recognition is not a big issue. It’s good to see some US states take proactive measures in this regard, though. Tennessee is certainly on the right track.
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