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Powers On… Why aren’t more law schools teaching blockchain, DeFi and NFTs?

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Powers On… Why aren’t more law schools teaching blockchain, DeFi and NFTs?

Blockchain technology is transformative for both our financial system and commercial enterprises, as well as for improving the human condition. More and more unbanked citizens both abroad and here in the United States now can have the capability to transfer and receive funds from loved ones with speed, economic efficiency and anonymity, where necessary, from oppressive regimes and governments and unstable economies. Traditional financial systems that have long not been available in underserved communities in various parts of Africa, Asia and Latin America must now recognize the power and efficiency of blockchain.


Powers On… is a monthly opinion column from Marc Powers, who spent much of his 40-year legal career working with complex securities-related cases in the United States after a stint with the SEC. He is now an adjunct professor at Florida International University College of Law, where he teaches a course on “Blockchain, Crypto and Regulatory Considerations.” 


In less than two years, decentralized finance, or DeFi, has sprung up. These communities can borrow and exchange funds in a matter of minutes for their businesses or personal expenses. DeFi has grown from an ecosystem of less than $1 billion in early 2020 to one with over $250 billion in locked value today. Interest in nonfungible tokens, or NFTs, has equally exploded. These collectibles and other forms of NFTs captured more than $10 billion in sales volume in quarter three, up from $1.2 billion six months prior.

Importantly, these blockchain use cases have legal and regulatory considerations. In particular, the United States Securities and Exchange Commission has made clear that most forms of tokens should be considered “securities” and thus subject to both the jurisdiction of the SEC and the regulatory frameworks of U.S. federal securities laws. 

In a recent article in The International Journal of Blockchain Law, the SEC’s newest commissioner, Caroline Crenshaw, notes

Many DeFi offerings and products closely resemble products and functions in the traditional financial marketplace. […] Market participants who raise capital from investors, or provide regulated services or functions to investors, generally take on legal obligations.” 

In other words, certain aspects of DeFi likely involve the jurisdiction of multiple federal authorities, including the Department of Justice, Financial Crimes Enforcement Network, Internal Revenue Service, Commodity Futures Trading Commission and SEC. In the NFT space, there is no question that various intellectual property rights are implicated, such as copyright and trademark laws, as well as possible securities laws.

The need for tech-educated lawyers 

It is clear there is a growing need for lawyers here and abroad to understand these possible legal issues and jurisdictions. It is, or should be, obvious that the best lawyers are those who can counsel their clients from a sophisticated understanding of the area of business in which their clients operate. To counsel clients involved in the DeFi space, wouldn’t you want a lawyer with the technological literacy to understand blockchain and the legal issues surrounding it? And perhaps one with education or experience in finance or accounting, rather than one who studied philosophy or chemistry in college? As the many uses of NFTs explode, shouldn’t your lawyer have a good handle on the IP laws and artistic rights associated with the proposed NFT?

I believe lawyers should, and that is part of the reason I am now teaching both blockchain law and fintech law at Florida International University College of Law in Miami after practicing law at law firms and the SEC for 40 years. As businesses start up or grow into the use of digital assets, they will need guidance on the “rules of the road,” as I believe most businesspeople want to do the right thing and follow established laws. For this, they should be able to turn to the next generation of lawyers — those currently in law school — for the answers, or at least for the correct guidance. Yet shockingly, only around two dozen or so of the over 200 law schools here in America teach a class dedicated solely to blockchain or solely to financial technology, last time I checked. That is only 10% of all law schools! That has to change, and rapidly.

Earlier this year, I wrote a column about concerns I and others have with China’s efforts to have the digital yuan replace the U.S. dollar as the world’s reserve currency, stating that the U.S. has to more quickly embrace the idea of a central bank digital currency (CBDC) and its development. The same is true with our new crop of lawyers. We must be educating them in new technologies and the use cases of blockchain, artificial intelligence, data analytics, and augmented and virtual reality, among others. This will vitally assist them in better representing clients. The last great technology was the internet, which the U.S. dominated in its development — but that was 25 to 30 years ago. U.S. leadership and dominance are not present with blockchain technology. Lawyers can assist in advancing this goal, with a good understanding of both the technology and laws affecting it, helping to shape or reshape the laws that do and should apply to it.

The intersection of technology and U.S. laws

Let’s look briefly at two legal cases demonstrating how NFT activities have found their way into the crosshairs of U.S. laws. In a lawsuit filed on Nov. 16 in federal court in Los Angeles, Miramax sued director Quentin Tarantino, who had been a collaborator on various movies, for breach of contract, copyright and trademark infringement, and unfair competition. Tarantino had allegedly been preparing to sell seven previously unpublished, unused scenes from his Pulp Fiction movie script in December. Miramax claims this violates its rights to the movie in various operative agreements, and Tarantino apparently believes these proposed NFTs are his to sell under the “reserved rights” provisions of his contracts with Miramax. A cease-and-desist letter from Miramax to Tarantino is apparently being ignored by him. It will be interesting to see what happens with this next month.

In a lawsuit filed in May in the Supreme Court of the State of New York, Dapper Labs — developer of the Flow blockchain and collaborator with the National Basketball Association on selling NBA Top Shot Moments — was sued in a class-action lawsuit. The gravamen of the complaint is that the tokens on the Flow blockchain, which powers and brands the NFTs, are “securities.” Also at the center of the lawsuit is the NBA Top Shot “Marketplace” itself, located on  its website, where you can purchase and sell these “Moments.” Thus, it is alleged that the sale and exchange of the tokens involve the sale of unregistered securities in violation of Section 12(a)(1) of the Securities Act of 1933. Noteworthy is that the legal proceeding was filed in state, not federal, court and that the NBA itself was not named in the action. This can perhaps be explained in that the NBA was not the “issuer” of the securities and that the plaintiff’s lawyer prefers state court, where a judge may be more inclined to allow the case to proceed and not subject them to sanctions.

These cases are illustrative of my point of needing lawyers who understand these technologies and their legal implications. So, let’s get to training our future lawyers for the future, as the future is now!


Marc Powers is currently an adjunct professor at Florida International University College of Law, where he is teaching “Blockchain, Crypto and Regulatory Considerations” and “Fintech Law.” He recently retired from practicing at an Am Law 100 law firm, where he built both its national securities litigation and regulatory enforcement practice team and its hedge fund industry practice. Marc started his legal career in the SEC’s Enforcement Division. During his 40 years in law, he was involved in representations including the Bernie Madoff Ponzi scheme, a recent presidential pardon and the Martha Stewart insider trading trial.


The opinions expressed are the author’s alone and do not necessarily reflect the views of Cointelegraph nor Florida International University College of Law or its affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice.


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Finance Committee Approves Legislation Delaying Crypto Tax in South Korea

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Finance Committee Approves Legislation Delaying Crypto Tax in South Korea

Finance Committee Approves Legislation Delaying Crypto Tax in South Korea

Changes meant to postpone the introduction of a tax on virtual assets such as cryptocurrencies in South Korea have been approved by an important parliamentary committee. The draft legislation seeks to delay Seoul’s plan to impose a 20-percent levy on gains from crypto transactions.

Ahead of Election, Major Parties Support Tax Break for Crypto Investors in South Korea

South Korean parliament is taking steps to suspend a planned tax on profits from digital asset investments for another year. The move has been supported by the ruling Democratic Party, despite disagreements with the government itself, as well as the leading opposition People Power Party.

The amendments, which also envisage the increase of an exemption on capital gains tax for real estate sales amid rising property prices, are viewed by Korean politicians as a popular proposition ahead of the upcoming presidential election in March next year, the Korea Joongang Daily noted in a report.

The Strategy and Finance Committee at the National Assembly passed the changes to the respective provisions during a meeting on Tuesday. The voting followed the approval of the revisions by its subcommittee on taxation during a session on Monday.

Authorities Need More Time to Set Up Taxation System for Crypto Assets

The two Korean parties have agreed to postpone the adoption of a 20% tax on annual profits from virtual asset investments exceeding 2.5 million won ($2,102). The government planned to introduce the tax on Jan. 1, 2022, but the recent voting indicates the tax is likely to be suspended until 2023.

The Democratic Party has been pushing for the delay as investments in cryptocurrencies have become quite popular with young voters who also find it very hard to save enough money for a home amid skyrocketing property prices. The party also hopes that the raising of the capital gains tax exemption for single residence owners who sell from a price of 900 million to 1.2 billion won ($1 million), will help to increase the availability of homes on the market.

DP representatives have argued that Korean tax authorities need more time to establish a proper tax system for virtual asset investing. However, Finance Minister Hong Nam-ki opposed the delay, stating that “The government is ready to immediately tax virtual assets.” He nevertheless noted that the executive power will comply with any decision by the parliament, which is expected to vote on the amendments in early December.

Do you think South Korean lawmakers will support the proposed amendments concerning crypto taxation? Tell us in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Jack Dorsey Resigning as CEO of Twitter Is Bullish for Crypto, Says Fundstrat

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Jack Dorsey Resigning as CEO of Twitter Is Bullish for Crypto, Says Fundstrat

Jack Dorsey Resigns as CEO of Twitter — Fundstrat Says Bullish for Crypto

Twitter now has a new chief executive officer after Jack Dorsey resigned Monday. Dorsey, who is still the CEO of Square Inc., previously said that he wants to focus on bitcoin. Fundstrat Global Advisors’ managing director and head of research explained why Dorsey’s departure from Twitter is bullish for crypto.

Twitter Has New CEO: Jack Dorsey Steps Down

Jack Dorsey announced Monday that he has resigned from Twitter. In his letter to the Twitter team, the former CEO explained that it was his decision to leave. Parag Agrawal, who served as Twitter’s chief technology officer, is the new CEO. Dorsey is still the CEO of Square Inc., which is currently working on several bitcoin projects.

Tom Lee, managing partner and head of research at Fundstrat Global Advisors, believes that Dorsey’s resignation from Twitter is bullish for the crypto market. In an interview with CNBC Monday, he was asked what Dorsey’s exit from Twitter means for the bitcoin and cryptocurrency ecosystem.

Responding to the question, “Is it bullish for crypto?” Lee affirmed:

Yes, it’s bullish for crypto.

“One thing to keep in mind is that crypto is the intersection of financial services and technology. That’s literally 60% of the economy. Really, financial services is the other half of GDP, so it’s a huge market,” he elaborated. “And there isn’t enough capital allocated towards crypto innovation, so it takes people like Jack Dorsey to really marshal focus and I don’t think the space is overinvested yet.”

Lee added that it is still the earliest days for the crypto space, not only for projects like Bitcoin and Ethereum but also “the amount of crypto equities and businesses built around crypto.”

Earlier this month, Twitter set up a dedicated team to focus on cryptocurrency and decentralized apps.

Dorsey said at the Bitcoin 2021 Conference in June, “If I were not at Square or Twitter, I would be working on bitcoin.” The former Twitter CEO emphasized, “If [bitcoin] needed more help than Square or Twitter, I would leave them for bitcoin,” noting:

I don’t think there is anything more important in my lifetime to work on.

His other company, Square, is “focused on helping bitcoin reach a mainstream audience while at the same time strengthening the network and ecosystem,” Dorsey said during Square’s Q3 earnings call early this month. “Our focus is on helping bitcoin to become the native currency for the Internet … We have a number of initiatives toward that goal. Cash App is just one.”

Do you think Jack Dorsey resigning from Twitter is bullish for bitcoin and crypto? Let us know in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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RChain and Hoo: The Arrow Has Already Been on the String

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RChain and Hoo: The Arrow Has Already Been on the String

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On November 27th, 2021, RChain‘s founder Greg Meredith and blockchain scientist Atticbee were invited as guests to an AMA hosted by the Hoo Exchange. Hoo is a Dubai based innovation driven crypto exchange and has their in-house developed public chain, HSC, built for the global cryptocurrency market. In this session, Greg Meredith and Atticbee shared the latest developments in RChain and remarkable ideas about the future of the blockchain and metaverse.

RChain and Hoo: The Arrow Has Already Been on the String

RChain and Hoo: The Arrow Has Already Been on the String

Built as A Coordination Technology, Instead of Payment Platform

According to Greg, RChain focuses on blockchain as a coordination technology to provide a means for global coordination as conditions get more and more severe due to climate change. RChain is designed as a scalable global computer and storage mechanism, rather than a payments system. It is impossible to build a general purpose computer out of a cash register, while to build a cash register out of a general purpose computer is like a walk in the park.

This is the first blockchain that scales linearly. This means that as you add nodes/hardware it gets faster, not slower. The current test data shows that the testnet gets roughly 1,000 tps per node per CPU. So a network of 10 nodes with 10 CPUs each gets 10,000 tps. 20 nodes with 20 CPUs each gets 20,000 tps, etc. Data can be realistically stored, updated, and searched on-chain.

RChain’s smart contract language Rholang, is a concurrent transactional query language, reconciling the best of SQL and NoSQL. It means one can write sophisticated queries to search stored data, which distinguishes itself from systems like IPFS. Smart contracts can be statically checked for concurrency and security errors. So, errors like what caused the DAO bug will be caught at compile time not in deployment. Imagine what would have happened to Ethereum if they had been running at 40K tps when the DAO bug was exploited.

Synergy Between Metaverse and RChain

In the AMA Greg explained his long involvement in the metaverse area. He worked directly with the pioneers of VR/AR, was hired at the research lab where Kim Fairchild did SemNet, by Kim Fairchild himself. He also was the one who suggested to Alan Wexelblat the title Software.

However Greg expressed his concerns about our real world. Yes, the metaverse is hot, but planet Earth is even hotter. In fact, in as little as a decade we are likely to see more than 1.5C temperature rise making the tropical zone uninhabitable, with wet bulb conditions — where the humidity and temperature are so high your sweat cannot cool you off — making it so that people will not even know that they are dying of heat exposure. Unfortunately, about 40% of the world’s population lives in the tropical zone. So, in as little as 10 years, 2.8B people are going to become climate migrants. Unfortunately, those 2.8B people will not be able to move into the metaverse. It won’t be any cooler for the servers running the simulations.

Atticbee later commented that this question needs to be answered: what is the role of blockchain in the metaverse? If metaverse only uses blockchain to trade game props, virtual real estates etc as NFTs, then the current technology may be good enough, at least if the transaction volume is low. However if Metaverse tries to simulate the real world, and uses blockchain as the trustable computing layer, RChain’s computing model is much closer to how the real universe works than the state machine used by virtually all other projects. As Greg Meredith said before, evolution has already picked out the best concurrent computing model, and the sequential Turing machine is never the chosen one.

Also the underlying blockchain technology and the upper layer metaverse will mutually stimulate and evolve. Just like in history – when we only had steam engines, we could only build trains and ships. After we created the combustion engine, we could do cars, airplanes etc. Every tech breakthrough will open new doors for tomorrow’s world. With RChain’s concurrent computing, seamless sharding and on-chain storage, Metaverse will be reshaped by RChain’s breakthrough technology.

Click to Play VS Click to Pay

When asked about RChain’s plan for ecosystem development, Greg answered that RChain focuses on a transaction volume driven route.RChain is looking at applications, such as self-sovereign data, online advertising and sponsorship, and social networks that generate large transaction volumes. The economic argument is simple. Currently, proof-of-work miners are making millions per day. What would make them want to switch proof of stake validators? If you lower transaction costs, you are just going to cut into their profits. If you cut transaction costs by a factor of 100, but raise transaction volume by a factor of 1,000, then they stand to make 10X, and at a fraction of their power consumption. Now, you have a real argument for them to move to proof-of-stake.

Once you understand that transaction volume is where the action is, then you just have to look at the Internet. How many times do you click to pay versus click to “Play”? That is, how many times do you click to post on Instagram or Twitter or WeChat versus to pay a bill or a vendor? How many times do you click to stream on YouTube or Spotify versus to pay someone with PayPal, Venmo or WeChat? It’s hundreds (if not thousands) to one. All the transaction volume is in click to “Play”.

And wherever you play, there are ads. In fact, online advertising is the largest economy in the world. It’s bigger than oil. So, RChain wants to help people make lots and lots of decentralized clicks to play DApps: social networks, streaming services, logistics services, data services, etc. And it wants to stream sponsored content through those decentralized services, but do so in a way that it eliminates surveillance capitalism. It also wants people to have a say as to whether their data is sold and if it is sold and get a cut of the profits.

Migration From Other Public Chains’ Ecosystems to RChain

RChain’s sharding solution allows other chains to be mounted as shards. This means that smart contracts can be written as if other chains were just RChain resources. In this case, for the RChain side, there is a very easy migration.

The biggest stumbling block to migration is the mismatch in the computational model. RChain operates concurrently while most other blockchains operate sequentially. This means other chains cannot handle RChain’s execution demands. RChain execution requests to other chains will queue up and queue up as they process them one at a time.

Of course, going the other way is simple, but it means that RChain has to slow down to match the sequential semantics of the other chains.

Toward a Leaderless Global Computer

RChain has been in mainnet for just under 2 years. Last year it released a major feature: the last finalized state, which means that new validators can synchronize to the chain without having to go all the way back to the genesis block. This year it is releasing a major performance improvement called block merge, that gives the linear scaling. It’s the culmination of Greg’s research of architecture and mathematics in the last 30 years, some of the work can go back to Microsoft’s BizTalk Process Orchestration that Greg worked on 20 years ago.

As Atticbee explained, there exists the following relationships btw “traditional computer” and the blockchain “global computer”:

  • Traditional Computer : Blockchain computer.
  • Multithreading : concurrency of block merge.
  • Multiprocess : sharding (composability).
  • Firewall : on-chain formal verification (behavior type system).

All these 3 parts are necessary for a truly useful global computer. And the computational layer should be carefully chosen so that all these parts can be supported, it means the chosen computational model should support concurrency, composability and a behavior type system.

RChain and Hoo: The Arrow Has Already Been on the String

Figure: Computational Model Comparisons

Unfortunately that leaves very few choices. From the above table, only Pi or Rho-Calculus can provide all the required features. Rho-Calculus is the upgraded version of Pi-Calculus. With reflection with much more expressive power. It is the first process of calculus suitable as a smart contract language. And Greg Meredith is the founder of Rho-Calculus.

RChain and Hoo: The Arrow Has Already Been on the String

Figure: The Knowledge Graph of RChain

With the coming “block merge” milestone the multi-threading/concurrency capability will be demonstrated. After that RChain will have a “seamless” sharding solution that makes many shards “look and feel” like one. Finally in the Venus milestone, a behavior type system will be implemented to allow thousands of contracts to safely cooperate with each other. Above that it will be possible to add a smart contract orchestration layer like a decentralized Kubernetes. Without a carefully chosen computational model, all these are impossible and the platform will be locked in as a payment solution, rather than a global computer that can handle a global scale, all-in-one computing infrastructure to serve Web 3.0.


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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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