The Commodity Futures Trading Commission (“CFTC”) recently published a detailed primer on smart contracts. The Primer discusses their functionality, use cases, regulatory environment and potential risks. It describes a “smart contract” as a set of coded computer functions that (1) may incorporate the elements of a binding contract (e.g., offer, acceptance, and consideration), or (2) may execute certain terms of a legal contract, or (3) allows self-executing computer code to take actions at specified times or based on reference to the occurrence or non-occurrence of an action or event (e.g., delivery of an asset, weather conditions, or change in a reference rate). The Primer also observes that a smart contract may not be a legally binding contract, which is a critical distinction for developers and entrepreneurs (and their counsel) in the digital economy.
Ohio is the first state in the United States to accept tax payments in cryptocurrency. Starting today, December 3, 2018, companies operating in Ohio can elect to pay certain Ohio state taxes in Bitcoin. Many Ohio state taxes are eligible for payment in cryptocurrency, including (among others) sales tax, withholding tax, pass-thru entity tax, and public utilities tax. As long as an entity operates in the state of Ohio and pays Ohio state taxes, the entity is eligible to pay such taxes in Bitcoin.
As reported on the Hunton Insurance Recovery Blog, in what appears to be a case of first impression, an Ohio trial court ruled in Kimmelman v. Wayne Insurance Group that the crypto-currency, Bitcoin, constitutes personal property in the context of a first-party homeowners’ insurance policy and, therefore, its theft would not be subject to the policy’s $200 sublimit for loss of “money.” Continue Reading “Crypto-Property:” Ohio Court Says Crypto-Currency is Personal Property Under Homeowners’ Policy
Interest in the crypto economy continues to grow in Congress. On September 25, 2018, Representative Warren Davidson (R-OH) hosted a roundtable, “Legislating Certainty for Cryptocurrencies,” with more than 50 financial institutions and crypto start-ups invited to attend. Additionally, the House Financial Services Committee has scheduled a hearing on financial innovation on September 28, 2018, entitled Examining Opportunities for Financial Markets in the Digital Era. Continue Reading Recent Congressional Action Involving Digital Assets and Blockchain Technology
Recently, Canadian investment firm First Block Capital Inc. reported that FBC Bitcoin Trust, which the firm bills as the “first and only open-ended bitcoin fund approved by Canadian regulators,” has achieved mutual fund trust status under Canada’s Federal Income Tax Act. Units of a mutual fund trust are considered qualified investments under registered plans such as Registered Retirement Savings Plans (“RRSPs”) and Tax-Free Savings Accounts (“TFSAs”). Continue Reading Canadian Bitcoin Fund Granted Mutual Fund Trust Status