Regulatory Framework on Smart Contracts: A Comparative Analysis

Abstract

Smart contracts use a few contemporary technologies, such as blockchain and digital currency. Due to this, it carries numerous advantages to the consumers due to the nature of the technology such as transparency, quickness, lack of third-party intervention, and decentralization. Although numerous research has been conducted on smart contracts, there isn't currently a tangible remedy to deal with various lacunas in the regulatory framework for smart contracts. In this study, secondary data was gathered by analyzing academic websites and databases like Google Scholar including governmental and non-governmental organizations from various countries. In addition, doctrinal legal research using a comparative analysis approach has also been used in this research. Regulatory frameworks in various countries including but not limited to Malaysia, the United States of America, Malta, Switzerland, and Dubai have been observed. The finding shows that the issue of the legitimacy of smart contracts, capacity as well as validity and certainty of Oracle were the main legal issues with smart contracts. This paper has contributed to our understanding of the existing gap in Malaysia's regulatory systems. Additionally, this improves the corpus of knowledge in this area, assisting legislators and other decision-makers in amending new regulatory frameworks for Smart Contracts.