Smart Contracts Are Now Recognized Under Tennessee LawMar 27, 2018, 9:56PM
Tennessee has just passed a bill that recognizes the legal legitimacy of smart contracts and using Blockchain technology in conducting electronic transactions.
The State of Tennessee has passed a bill that recognizes smart contracts and ownership of certain information secured through Blockchain technology. This bill represents a large step towards the adoption of Blockchain-based technologies on a state level, and follows on the heels of a similar measure passed in Arizona in March of last year.
The bill defines a smart contract as:
“[An] event-driven computer program that executes on an electronic, distributed, decentralized, shared, and replicated ledger that is used to automate transactions.”
And gives legal authority to smart contract protocols:
“No contract relating to a transaction shall be denied legal effect, validity, or enforceability solely because that contract contains a smart contract term.”
By recognizing smart contracts and Blockchain-based platforms as legally-applicable technologies, Tennessee has opened its door to innovative Blockchain projects seeking a forum to test and develop new concepts. Arizona, for example, has seen exciting innovations in healthcare, the creation of a Blockchain research lab at Arizona State University, and the acceptance of cryptocurrency for state tax remittance.
As another indication that cryptocurrencies are no longer outside the bounds of the law, the IRS has issued a reminder to taxpayers outlining the need to report digital currency income for the 2017 fiscal year. The reminder makes specific reference to the fact that “some taxpayers may be tempted to hide taxable income from the IRS,” due to the “pseudo-anonymous” nature of cryptocurrency transactions, and provides clear guidance to taxpayers who need to report digital income. With multiple state governments passing legislation to help foster Blockchain adoption, and the IRS scaling up their efforts to find potential tax-evaders, the legal framework surrounding Blockchain technology is beginning to take shape in the US.
Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.