ABSTRACT
This Article turns from the current legal battleground for crypto, securities law, to the next one, corporate law. Are blockchain actors fiduciaries like corporate directors? A suit seeking to impose fiduciary duties on blockchain developers might soon arise in the US, as a major UK case on that very issue bounces between the lower and appellate courts. That case illustrates the issue’s importance, and the lack of a clear answer. This Article dives into the nuances of blockchains and the crypto assets that power them to discuss when fiduciary duties may be appropriate on the blockchain, who should owe them, and who should be the beneficiaries.
The Article also reveals how whether crypto assets are securities influences the corporate law answer, and discusses whether fiduciary duties, if imposed, should be modifiable by contract as in traditional business entities. Throughout, the Article compares the decentralized blockchain Bitcoin and its crypto asset bitcoin with the centralized FTX, a cryptocurrency exchange founded by Sam Bankman-Fried and its crypto asset, ftt. Applying the criteria outlined earlier, this Article concludes that no one on the Bitcoin blockchain should be considered a fiduciary, while FTX and Bankman-Fried are fiduciaries who owed duties of care and loyalty to ftt holders.
Ibrahim, Darian M, Corporate Law on the Blockchain (September 19, 2023), 7 Stanford Journal of Blockchain Law and Policy (Forthcoming); William and Mary Law School Research Paper No 09-477.
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