Smart Contracts … Credibility and Methodology: In-depth Critical Study in Philosophy and Originality
Prof. Mohammad A. Al Khatib
Professor – Civil Law – Law Department – Ahmad bin Mohammad Military College – Doha – Qatar
The research paper presents an in-depth critical study of the philosophy and originality of “smart contracts” and its digital holder: “Blockchain”, in a doctrinal attempt to extrapolate the inherent philosophy of these “smart” contracts, and then to drop them on the traditional contract theory on civil law, with both its inherent and philosophical dimensions. This is carried out according to a research methodology that does not compare law to law, but rather philosophy to philosophy, in an attempt to determine the effectiveness of these contracts within the theory of the contract, in addition to addressing the legal problems that are likely to result from the theory of compliance in general and the contract theory in particular.
The research is carried out according to a research chart, which presented in its introductory preface a brief presentation of the digital holder of these “smart contracts” software known as “Blockchain” series, and then to address in the first requirement the reliability of the definition of these “smart” contracts, researching the compatibility of the term defined for this contracts: “Smart contracts”, with their terminological and conceptual content. Following this, the researcher presented in the second requirement the fairness of the policies underlying these contracts, analyzing the compatibility of the objectives sought by these contracts with the law, in its both dimensions: protectionist and values.
The research concluded that talking about the idea of the contract in “smart” contracts, in both concept and terminology, is merely a linguistic artificiality in order to promote these mechanical contracts, which are far from intelligent, as they do not depart in the characterization and entity from the implementation mechanism of the contract, linked to its existence and nothingness, emphasizing that this characterization alone constitute a factual and actual addition to the theory of the contract, and displaying the legislative shortcomings that such mechanism suffers from, and the need for legislative intervention in that respect.
The research also concluded that this executive mechanism, although linked to the existence and non-existence of the contract, it is a separate from in its philosophical methodology, which excludes the human side in implementation due to the fact that the automated aspect is based on utilitarian economic considerations that only believe in money, and a rigid algorithm that only believes in numbers, with an attempt to establish a major equation in the relationship between law and algorithms, that: “Code is Law”, emphasizing the incorrectness of this hypothesis and its injustice, and that the law is the law governing the code “Law is Code”.
In light of the foregoing, the research called on everyone: jurists, economists, and artificial intelligence programmers, to work together and make concessions, with the aim of reaching a consensual contractual system that takes into account the requirements of the law and its foundations, as well as the nature of digital openness in its economic and programmatic dimensions.
We hope that legislators shall review several legal rules related to contract theory, in order to make them more open and responsive to this digital variable, to develop an initial conceptual perspective of a legal framework that shall not constitute an obstacle to economic and technological development, but rather a product of a successful alignment between the principles of precaution and innovation.
All within a framework which this study hopes to clarify some of its aspects.
Keywords: Blockchain; Bitcoin; Artificial Intelligence; Code Is Law; Economic analysis of law; Mathematical analysis of law; Predictive Justice