From Code to Court and Beyond: Alternative Dispute Resolution On and Off the Blockchain

This article appears in the Dispute Resolution Journal®, a publication of the American Arbitration Association®-International Centre for Dispute Resolution®, Volume 78, Number 4 (Nov-Dec 2024).

In the lead article of this upcoming edition, the Mayer Brown authors explore the role of alternative dispute resolution in smart contract disputes, with a focus on the United States. The opening two paragraphs are below and the full PDF can be accessed at the end of this page.

Smart contracts are a revolutionary step in the digital and legal worlds. While not every smart contract is a legal contract, a smart contract is often a streamlined, digital expression of consent that happens to be stored on a blockchain. The growing popularity of smart contracts raises the question of not whether disputes will arise from their use but how breaches of smart contracts will be resolved. Users of smart contracts have already identified arbitration as a mechanism well suited to the novel needs of blockchain disputes. This article explores the role of alternative dispute resolution (ADR) in smart contract disputes, with a focus on the United States.

Despite their appellation, smart contracts are neither smart nor always—or even often—legally binding contracts. A smart contract is a computer program or transaction protocol that automatically executes certain actions once certain terms are met. A useful analogy is to that of the vending machine: once the dual terms of a certain amount of currency and the push of a button are met, the program (i.e., the smart contract) automatically executes by dispensing an item.

Please click here to download the entire article as it appears in the publication.