Controllable Electronic Records refer to digital records that can be definitively attributed to a single party with exclusive authority to transfer or dispose of them. This legal concept, often found in commercial law statutes, provides a framework for treating certain electronic assets as transferable property. It establishes a clear chain of ownership and control, vital for legal certainty in digital transactions. This framework is particularly relevant for digital assets.
Context
The legal status of digital assets as controllable electronic records is a central discussion point for policymakers and legal scholars globally. This classification influences how digital assets are treated in lending, security interests, and bankruptcy proceedings. Jurisdictions are updating their commercial laws to accommodate the unique characteristics of blockchain-based assets, aiming to provide clear guidance for market participants.
New UCC Article 12 establishes "control" as the perfection standard for security interests in digital assets, fundamentally de-risking secured lending.
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