The Status of Cryptocurrencies in International Law of Trade and Foreign Investment

Document Type : Original Article

Authors

1 Associate Professor of International Law, Group of University of Qom, Qom, Iran.

2 Master of International Law, University of Qom, Qom, Iran

Abstract

Cryptocurrencies are digital assets created using encryption techniques intended to serve as a means of exchange. Given their cross-border nature, it's important to consider their status within the international legal system. While many governments have recognised cryptocurrencies as money, others view them as assets that can be traded, like goods or services. Under certain conditions, they may also be treated as investments. This raises the question of how cryptocurrencies should be classified under international law of trade and foreign investment law. The hypothesis is that categorising cryptocurrencies as goods, services, or capital presents challenges in applying traditional international law of trade and foreign investment frameworks. The World Trade Organization, as the most critical component of the international trade regime, lacks explicit rules related to cryptocurrencies. Applying the principles of the national treatment and the most favoured nation within this framework to cryptocurrency-based transactions will encounter obstacles. One of the most significant challenges in classifying cryptocurrencies as foreign capital is determining whether these assets meet the requirements for such classification, regardless of their origin. If cryptocurrencies can be considered securities or telecommunications services, they may be included under the scope of the World Trade Organization's legal system. Additionally, investing in technology such as distributed ledger using cryptocurrencies, purchasing company shares with cryptocurrency, buying equipment for investment purposes, or acquiring AI tokens could all be examples of capital under general investment treaties.

Keywords

Main Subjects

References

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ModernTechnologies Law
Volume 4, Issue 8 - Serial Number 8
October 2023
Pages 169-180

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History

  • Receive Date: 31 January 2023
  • Revise Date: 16 May 2023
  • Accept Date: 22 June 2023

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