New Recommendations for Reform and Development of Law on Digital Assets: Securing UK's Position as a

On June 28th, the Law Commission of England and Wales has today published recommendations for reform and development of the law relating to digital assets.

Here are the key proposals:

1. Digital Asset Use: Digital assets, including crypto-tokens (cryptocurrencies) and non-fungible tokens (NFTs), are used increasingly for a variety of purposes such as investments, payments, and linking to or embodying debt and equity securities.

2. Need for Legal Reform: Personal property law in England and Wales has been somewhat flexible to accommodate digital assets in the last 15 years. Still, with the rapidly changing digital asset market and related technology, there is a need to address the remaining legal uncertainty and complexity.

3. Government Initiative: The Government has asked the Law Commission to carry out the first-ever rigorous common law analysis to determine how the law in England and Wales can adapt to emerging technology.

4. Recommendations for Reform: The Commission's recommendations are designed to provide a comprehensive legal foundation for digital assets, allowing new technologies to thrive and enabling a broad range of market participants to interact with and benefit from them.

5. Common Law Capability: The Commission's report shows that the common law of England and Wales can provide a globally relevant regime for existing and new types of digital assets.

6. New Category of Personal Property: The Commission argues that the common law's flexibility can accommodate a distinct category of personal property for digital assets, which are intangible and differ significantly from physical assets.

7. Panel of Industry Experts: The Commission suggests that the Government create a panel of industry experts to provide guidance on technical and legal issues relating to the control of digital assets.

8. Legal Tools: The Commission also recommends providing market participants with new legal tools, such as ways to take security over crypto-tokens and tokenised securities, that do not currently exist in England and Wales.

9. Clear and Consistent Framework: The reform and common law development recommendations aim to create a clear and consistent framework for digital assets to provide users and market participants with greater clarity and security.

10. Global Crypto Hub: The recommendations align with the Government's goal of attracting technological development and bolstering the position of England and Wales as a global hub for crypto-tokens and crypto-assets.

Read more here: https://www.lawcom.gov.uk/new-recommendations-for-reform-and-development-of-the-law-on-digital-assets-to-secure-uks-position-as-global-crypto-hub/