Competing claims to crypto-assets

Abstract

At the height of the ‘crypto winter’, with several crypto intermediaries filing for insolvency and subjected to schemes of arrangement, who owns what and who has a claim on what becomes all important. At the same time, distributed ledger technologies are frequently presented as a digital solution to these perennial problems of competing claims to the same asset. This article makes two contributions to the literature. First, we show that neither current technology nor law solves the competing claims issue. Second, we suggest policy solutions based on a comparative legal analysis. In essence, the law must: (i) recognize property rights in crypto-assets; (ii) protect bona fide purchasers that receive crypto-assets from a transferor who exerts control over private keys; and (iii) facilitate the enforcement of titles in crypto-assets by the interplay of private and financial law. While full harmonization of national private laws is out of reach, some level of international consensus around these three principles would strengthen the impact of private law in the proper ordering and enforcement of claims to crypto-assets.