Florida Law Limits Legal Recognition of Smart Contracts and Prohibits Local Taxation

A new law grants smart contracts limited legal effect, specifying conditions under which they can be denied enforceability, while prohibiting local governments from imposing taxes on them. The legislation, as discussed in a Carlton Fields article, highlights the complexities and obtuseness of smart contracts in legal contexts.

The article from Carlton Fields, titled “Smart Contracts” Are Mostly Obtuse, focuses on the nuances of this law, particularly its provisions related to the legal validity of smart contracts. It details the specific limitations that determine when a smart contract may lack legal effect.

Background on the law includes restrictions aimed at balancing technological innovation with legal certainty. The legislation addresses key challenges in enforcing code-based agreements within traditional contract law frameworks.

Involved parties implicitly include lawmakers who enacted the statute and local governments barred from taxation. No specific dates, deadlines, or named individuals are mentioned in the provided content.

The law's broader context pertains to cryptocurrency and blockchain regulatory matters, aiming to provide clarity on smart contracts without fully equating them to traditional contracts. Regulatory bodies at the state level are central to its implementation.