Adjudicating Cryptocurrencies at the WTO: Potential Threshold and Substantive Issues

Abstract Taking Venezuela’s complaint against the United States at the World Trade Organisation (“WTO”) as the inflection point, this Article will explore whether a characterisation of cryptocurrencies as a ‘currency’ (similar to a fiat currency) would ensure that cryptocurrencies are not covered by WTO disciplines on goods and services. Despite customary international law principles such as ius cudendae monetae and the persuasive argument that a ‘currency’ is neither a good or service – the Article answers this question in the negative. It will divide issues that can arise during such a WTO dispute into three categories: threshold, substantive and compliance issues. Threshold issues would involve interpretative challenges to determine whether the General Agreement on Trade in Services (“GATS”) and General Agreement on Tariffs and Trade (“GATT”) regulate cryptocurrencies. Since the GATS Schedule of Commitments has historically been interpreted in a technologically neutral manner, identifying cryptocurrencies as a ‘service’ may not prove to be insurmountable. However, the claim that cryptocurrencies are barter goods that will be subject to disciplines of the GATT deserves critical scrutiny – more so because the GATT regulates tangible products and contains specific provisions relating to balance-of-payments. The Article also undertakes a theoretical analysis of the heterodoxical nature of the cryptocurrency to evaluate whether it can be classified as a ‘security’ within the meaning of the GATS’ Annex on Financial Services. These threshold issues are, however, the tip of the iceberg. Once a WTO Panel commences its analysis, the substantive issues for consideration would involve determining whether a unique product such as cryptocurrencies has a ‘like product’ in the respondent Member’s market. Further, the Panel’s analysis would involve a consideration relating to ‘general exceptions’ under Article XIV, GATS or Article XX, GATT which would entail an examination of whether the measure was necessary to achieve, amongst other regulatory objectives, either compliance with domestic regulations or the maintenance of public order. If the measure adversely impacting cryptocurrencies is determined to be WTO-inconsistent, issues of compliance and suspension of concessions are imminent. WTO Panels have historically estimated the . quantum of suspensions of concessions by determining the trade volumes affected by the WTO-inconsistent measure and factoring it for a future time period. The decentralised nature of the distributed ledger technology underlying cryptocurrencies complicates any country-specific quantification of the impact on trade volumes of cryptocurrencies affected by the WTO inconsistent measure. Accordingly, determining suspensions of concessions in relation to cryptocurrencies would require significant judicial innovation by the arbitrator. Adjudicating Cryptocurrencies at the WTO: Potential Threshold and Substantive Issues.