Publication: Digital technology-based solutions for enhanced effectiveness of secured transactions law:the road to perfection?
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2018-05
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Duke Law School
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Abstract
This article has two objectives. First, the article examines how the
incorporation of specific digital technologies to the different stages of secured
transactions could mitigate the imperfections of the secured transactions system
and enhance its effectiveness. To begin with, an envisioned integrated ecosystem
of smart property and self-executed smart contracts for security agreements
could effectively reduce verification and monitoring costs. Next, a fully
automatic electronic—maybe, blockchain-based—registry fed by a (IoT)
network of interconnected assets would dramatically improve the accuracy of
consistently-updated registered information. Furthermore, implanted AI-based
solutions could be used to detect changes of circumstances and deviations from
agreed provisions. Finally, AI-guided smart contracts could assist in decisionmaking
to prevent breaches and automatically enforce remedies.8 Second, given
this backdrop, the article focuses on some of the legal implications for secured
transactions legal system and assesses whether the current legal framework is
prepared to face the challenges inherent to these new technologies, to exploit the
multitude of opportunities presented by the technologies, and to manage the
involved risks. Alternatively, if the current system is incapable of taking on this
challenge, this article will consider an appropriate legal response.
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Keywords
Digital technology, Collateral security, Blockchains, Internet of things, Commercial law
Bibliographic citation
Rodríguez de las Heras Ballell, T. (2018), Digital Technology-Based Solutions for Enhanced Effectiveness of Secured Transactions Law: The Road to Perfection?, Law and Contemporary Problems, 81(1), pp. 21-44