Senate Bill 300 which was introduced by Senator Matt Dolan could pave the way for Ohio to be the next US state to legally recognise smart contracts and record on the blockchain. The bill makes amendments to the Uniform Electronic Transactions Act so it will now allow for smart contracts to be as legally enforceable as any other contract.
If the bill is passed, it would introduce a new language, stating that blockchain technology can be used to process and store electronic information as well as providing ownership rights.
“Notwithstanding any other law, a person that, in or affecting interstate or foreign commerce, uses blockchain technology to secure information that the person owns or has the right to use retains the same rights of ownership or use with respect to that information as before the person secured the information using blockchain technology.”
The bill continues: “This division does not apply to the use of blockchain technology to secure information in connection with a transaction to the extent that the terms of the transaction expressly provide for the transfer of rights of ownership or use with respect to that information.”
Notably, the bill makes amendments to language in a different section that pertains to electronic contracts, adding that “smart contracts may exist in commerce”. It also states that whilst a contract may be denied legal effect or enforceability solely because an electronic record was used in its formation, it goes further and specifies that smart contracts may be used for legal documents.
If the law is passed in Ohio, the state should join Arizona, California, Florida, and Tennessee in recognising both smart contracts and blockchain transactions in electronic records.
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