The Supreme Court of China has ruled that evidence authenticated using blockchain technology will now be binding for legal disputes, according to a report by Coin Telegraph. This marks the latest of several new rules which have emerged as Chinese authorities move to clarify procedures for internet courts. The rule went into effect immediately upon its announcement late last week.

Authenticity Required

According to the announcement from the Chinese Supreme Court, "internet courts shall recognize digital data that are submitted as evidence if relevant parties collected and stored these data via blockchain with digital signatures, reliable timestamps and hash value verification or via a digital deposition platform, and can prove the authenticity of such technology used."

This latest announcement follows from an August 2017 world first in a country which has led the way with blockchain innovation. At that time, the Chinese city of Hangzhou opened a court specifically dedicated to trials for internet-related disputes. One of the unique features of this court was its "netcourt" web platform. That particular court handled its first case which involved legally valid evidence derived from blockchain technology back in January of 2018.

Two New Internet Courts on the Way

Besides the first internet court in Hangzhou, China is also planning on launching courts in Beijing and the southern city of Guangzhou. These courts deal with all manner of Internet-related cases, including "litigation acceptance, delivery, mediation, evidence exchange, pre-trial preparation, court trial, and sentencing" on the internet.

For the rest of the world, the Chinese internet courts open up a new door in the world of blockchain. Blockchain-related innovations are increasingly being recognized for their potential to legally authenticate evidence. Indeed, it's possible that blockchain will prove so important to the legal sphere that it could even upend it entirely. One crucial aspect of this shift may have to do with the fact that a blockchain generates immutable, time-stamped data which can then be used as an auditable trail. Because smart contracts follow pre-specified rules, the security of the blockchain is set before any transactions or documentation takes place.

While no other country has yet followed in China's path, the U.K. Law Commission did announce earlier in the summer of 2018 that it would review legal frameworks involving smart contracts so that it doesn't lag behind as blockchain legal applications develop.

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