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Coming to Terms with Smart Contracts Part 1 – Fintech Security Challenges and Considerations

Teo Yi-Ling

[2020] SAL Prac 23

As the adoption of smart contracts in fintech and other applications continues to gain traction, concerns about security and reliability of their ecosystem and the legal certainty of the transactions themselves are growing. These two sets of issues will be examined in two parts: this first part will provide a brief description of the smart contract ecosystem, the significant security risks attendant thereto, and discuss a number of best practices ahead of smart contract adoption, to mitigate such risks. The second part will follow up and focus more sharply on the legal nature and enforceability of smart contracts and algorithmic contracts, the notion of “code is law”, and the ramifications for smart contracts given the landmark decision of the Singapore Court of Appeal in the case of Quoine Pte Ltd v B2C2 Ltd [2020] 2 SLR 20.