Seminar, InfoSec Seminar: NFT Art, Digital Asset-Backed Securities, and Universal Constructions in The Mathematical Philosophy of Law and Finance

Speaker: Joseph Tanega

Date/Time: 25-Mar-2021, 16:00 UTC

Venue: Virtual seminar

Details

Abstract: In the era of distributed ledger technologies (“DLTs”), questions arise as to what forms of legal interpretation should be applied to these new technologies involving digitized programs in the form of self-executing computer programs, i.e., whether as property rights, assets, securities, money, legal tender, intermediated securities, asset-backed securities certificates, investments as US Securities Regulations, as well as other jurisdictions.  Since the phenomena are new, they raise serious questions of legal taxonomy and more generally, the meaning of financial innovation with a focus on digital artifacts that are “unique assets” such as Non-Fungible Tokens (“NFTs”) or physical representations of legal objects, such as Digital Asset-Backed Securities (“DABS”).

We side-step the traditional legal taxonomic interpretations that are tied to specific jurisdictions to ask more general questions as to how any legal and financial interpretation of digital assets may turn out to be is consistent with a much more general perspective and principles that incorporate law, finance and technology, since after all the announcement of financial innovation involving such technology involves the undeniable simultaneous recognition of the technology as a de facto physical manifestation in at least 193 jurisdictions where the internet exists.  We are primarily concerned with the general framework of the abstract expression of de facto that underlies all legal phenomena that veers to and is rooted in un­iversalistic principles rather than any territorial circumscription.  Under this view, the current development of highly variegated and differentiated regulatory regimes and the legal guidance they offer as well as legal cases and their commentary form a broad global discourse that is dependent on observations of human activities and their correspondent ideas.  Instead of taking an “ideological stance” that is ultimately associated to political-economic divisions and distinctions, we hereby promote a new interdisciplinary view that is aligned to the post-Copernicum Revolution that we call, The Mathematical Philosophy of Law and Finance.  These principles are of knowledge creation and we apply these principles to the case of blockchain and DLTs in the field of financial innovation.

In this presentation, focusing on DABS and NFTs, we examine the relevant legal and financial developments in blockchain technologies especially in relation to the activities of the U.S. Securities Commission (“SEC”) and some of the pivotal administrative decisions reached in the period 2017 to 2021, and present examples of digital financial innovation as an illustration of our model.  Our primary interest is to provide a general theoretical construct (i.e., “Universal Constructions under Category Theory”) that may be used by educators and professionals to communicate findings within law and finance discourse to a broad public audience.  Thus, our intended contribution is towards a methodology and mapping of the social science of law and finance where a systematic understanding of a simple but rigorous mathematical philosophy will lead to generous developments in an area which is now inchoate but very likely to grow globally, namely, the intersection of law, finance and technology.

 

Bio: Joseph Tanega is a Professor of Law and Finance, Diplomatic Academy, Vrije Universiteit Brussels (VUB) and has published 79 peer reviewed scholarly works including 16 books and many articles in prestigious journals on financial law, securitisation, money market funds, risk management and international payment systems.  He is a former Deputy Attorney of the State of Hawaii, investment banker of Nomura Securities, Director of Business Risk Consulting and thought leader of financial institutions and capital markets for Ernst & Young, and Senior Legal Consultant to the IFC, World Bank. He is grateful to Philipp Jovanic, UCL’s Information Security Group, and members thereof from Imperial College, Cambridge University and Royal Holloway for their interactions. The earliest version of this paper including comments was thanks to Annamaria Viterbo, Alberto Oddenino and Gustavo Prieto, as members of the Scientific Committee, and those attending the Conference on the “International Economic Law in the Era of Distributed Ledger Technology,” Collegio Carlo Alberto, Piazzo Arbarello 8 – Torino, on the 9th of April 2019.  A part of this paper concerning the Mathematical Philosophy of Law and Finance was presented at the Conference on The Future Tech, on the 26th of March 2019, under the auspices of Professor Tomas Davulis, Dean of the Faculty of Laws, University of Vilnius.  The usual disclaimers apply.

 

 

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