Love.Law.Robots. by Ang Hou Fu

NFT

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It’s going to be a busy week! I’ll be attending the conferences below:

Here are the sessions that I am looking forward to:

SCCE Singapore Regional 2022

Of all the conferences, this is probably the one with the most practical topics I can apply to my work. So, although maintaining those Continuing Education Units for my certification is a serious challenge (40 points in 2 years?! Video conference at 1am?! 🤮), membership is still very useful to me.

Compared to last year’s regional, I think this one has far more breadth and indeed some depth into hot topics like ESG and Digital Data Management. Hot favourites like compliance training and supply chain management make an appearance too.

I am particularly curious about the finale: “Are robots running the compliance program?” Automation in compliance is that small victory that I think cash- and human resource-strapped compliance departments should look into. From the handout, the “automation” is Microsoft Power Automate, which while simple to understand and used in many corporate environments, is not as widely applicable compared to something like Zapier. Let’s see what new ideas I will get!

Automate Boring Stuff: Get Python and your Web Browser to download your judgementsThis post is part of a series on my Data Science journey with PDPC Decisions. Check it out for more posts on visualisations, natural languge processing, data extraction and processing! Update 13 June 2020: “At least until the PDPC breaks its website.” How prescient… about three months after I wroteLove.Law.Robots.HoufuIt's always important to automate the boring stuff.

IAPP Asia Privacy Forum

They took a long time to flesh this out — back when I bought the early bird ticket in early June, half of the programme was labelled to be confirmed. I’m glad they managed to flesh this out. It’d be my first IAPP Conference even though I have been a member and am CIPP/A-certified since 2019.

I am a pretty practical person, so I am going to list things that have meaning to me.

  • ” Building Privacy Technology Into Your Privacy Programme ” — Privacy by Design is one of those revolutionary concepts introduced by the GDPR that you probably don’t hear enough about. Privacy engineering has always been very fascinating to me too.
  • “ Towards Innovative and Global Solutions for Trans-Border Flow ” — The biggest challenges in Singapore isn’t really complying with the PDPA here but dealing with the implications of having an open economy. In my context, a regional HQ is a hub for data flows so having an interesting way to handle them will be useful.
  • “ Implementing Privacy in Yet-to-Mature Geographies ” — Related to the previous point, we are in a region where jurisdictions have not had much experience in privacy. Thailand recently made its GDPR-like law effective. Indonesia is still toying with the idea. India’s comprehensive data protection law appears to be trapped in legislative purgatory. Coping strategies will be very appreciated.

Alongside IAPP Asia Privacy Forum, the Singapore PDPC also organise the Singapore version of a conference. Topics seem quite interesting, but given my decreasing focus on data privacy in recent years, I am going to give it a pass.

TechLaw.Fest

It’s my third TechLaw.Fest and my first in person!

Actually. I don't know whether this is an in-person event. Something about the metaverse.

I count myself as a sceptic of the metaverse and was actually profoundly upset that the programme focuses almost entirely on this topic. Compared to last year where there was an even spread, this year looks like an advertorial to convince you that there is something special.

Three Things: TechLawFest 2021I debrief on the TechLawFest in Singapore which ended recently with three key takeaways.Love.Law.Robots.HoufuCompared to last year...

Anyway, I am still sorting out my registration because, frankly, the organisation of this event is messy this year.

I will be hiding out in the Tech Talks section this year. I don’t want to hear a big talk about a fad which no one will care about in a year or two. The metaverse is like cryptocurrency and NFTs; somebody is pouring lots of money into it but nobody honestly has high hopes about it.

Live by the Code… Die by the Code?The excitement about Cryptocurrency and NFTs has turned to panic and loss. Will something different take its place?Love.Law.Robots.HoufuIn an earlier post, I wondered whether the fallout from cryptocurrency will bring forth something good.

Some of the things I wish they covered:

  • The fallout about Crypto Currency and NFTs: This is an awesome topic for litigators and restructuring professionals with all the news going around of bank runs, fraud and corporate dissolutions. To be fair, I have a suspicion that this is going to be covered in “ ** What Happens in the Metaverse Doesn’t Stay in the Metaverse: How Laws Apply Such That In-world Crime Could Mean Real-world Punishment** ” on the Main Stage on 22 July 2022.
  • AI Regulation — I believe there are some major advances in the field (in Europe, I think?) and this is a topic that is getting closer to law and regulation once the technology is more mainstream. The IMDA also released its own AI Governance Testing framework and toolkit in May, so I am surprised nobody wants to talk about it here.
  • I wouldn’t complain about learning more about legal operations. To be fair, “ ** The Virtual Lawyer: How Digitalisation is Changing the Business of Law** ” on the Main Stage on 21 July 2022 seems related. I am going to be rather peeved if it’s about how I can appear as an avatar to my colleagues… as if using Microsoft Teams wasn’t lame enough.

The past two years have forced a reckoning that the brick-and-mortar law office may not be as essential to lawyering as was assumed by many for a long time. In this session, we hear from a range of legal professionals wrestling with digitalisation and the business of law. #tlf22 pic.twitter.com/ShnH1DRCup

— TechLaw.Fest (@TechLawFest) July 13, 2022

Conclusion

There's going to be lots to do, and I am going to practice live tweeting this year so that I would get better at it. Last year, I tried to write a roundup but it was really tiresome, so please follow me on Twitter!

#blog #Compliance #Cryptocurrency #Ethics #Law #News #NFT #PersonalDataProtectionAct #Privacy #Singapore #TechLawFest #TechnologyLaw #IAPP #SCCE #DataProtectionOfficer

Author Portrait Love.Law.Robots. – A blog by Ang Hou Fu

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It's an exciting time to be alive. In last year's TechLawFest, Singapore's signature legal conference for folks who need to shore up their tech gravitas, NFTs were discussed furiously. Back then, NFTs were the hottest thing in the universe, and lawyers either knew NFTs or didn't.

The world is much different these days. TechLawFest has already moved on to the “Metaverse”.

We've got more top-notch speakers to break down every aspect of the Metaverse for you.

Don't miss out: https://t.co/BvgY2wOqpy ​#futurelaw #lawandtechnology #tlf #tlf22 #techlaw #techlawfest pic.twitter.com/c6OMnx5f3Q

— TechLaw.Fest (@TechLawFest) May 24, 2022

In the meantime, the value of NFTs and cryptocurrencies plunged. Two years of financial gains were wiped out. Suddenly, celebrities piping cryptocurrencies went quiet and were ordered to do some soul searching.

It's the biggest “I told you so” moment in my recent memory. This makes the websites of crypto sceptics fun to read. The “counter” memes are fun too.

Diamond Hands is crypto slang, by the way.

Anyone familiar with the reality in this space is well aware that scams and frauds are plentiful, and the dreams are as beautiful as the chasms you can fall into. This isn't an investment blog, but high risk doesn't lead to high returns. A get-rich scheme is not for the faint-hearted or the ethically firm.

From the Boulevard of Broken Dreams

I am secretly happy that cryptocurrencies and NFTs have finally had their long-coming reckoning. It's not because I like people losing money. Or that crypto bros will finally shut the hell up.

My interest in this area is quite intellectual. I think such technologies raise fascinating questions, which is the most lawyerly thing you will hear me say on this blog for a long time.

Take stolen NFTs, for example:

Looking forward to precedent setting debates on IP ownership & exploitation, having spent 18 years studying copyright & the industry laws. I’d ather meet @DarkWing84 to make a deal, vs in court. We can prove the promise of ape community https://t.co/U1GpYK2X7d

— Seth Green (@SethGreen) May 24, 2022

You might remember Mr Green as either Dr Evil's son, a voice on Family Guy, or the creator, writer, etc., of Robot Chicken. He was also a victim of a phishing scam which took away his NFT. All this sounds rather ordinary, but Mr Green also had plans to use the Ape referred to in his NFT for a show. Without his NFT, he can't make his show.

Sorry, what?

Presumably, it's because when you own an NFT, you own the right to parade it in other material. You know, like how some people pick which shows their pets will star in. If you don't own a pet, there's no show.

However, it's not so simple. An NFT is a reference to a particular bunch of data on a blockchain. Furthermore, “owning” a thing isn't necessarily the same as owning its intellectual property. No one gets the idea that because they bought a Harry Potter book, they get to start their own Harry Potter universe.

Even so, this confusion is particularly rife with digital products. Just because you own the “metaverse” handle on Instagram doesn't take away Meta's right to take back their handle per their terms of use.

Beware the metaverse. It's not all fun and games out there.

In this regard, BAYC's terms of use are a crap shoot.

Source: https://boredapeyachtclub.com/#/terms (access 12 June 2022)

  • Yes, “You Own the NFT”. That sounds great, even though the capitalised “Own” looks fishy.
  • “When you purchase an NFT, you own the underlying Bored Ape, the Art, completely”. What's with the comma between “Bored Ape” and “the Art”? Is “Bored Ape” the definition of the “Art”? Or are there two things, the “Bored Ape” and “the Art”? What does owning something “completely” mean anyway?
  • Clause ii starts with “Subject to your continued compliance with these Terms…”. I guess this is what owning something completely means?
  • Who is “you” anyway?

Of course, this may be only a snapshot of the agreement between BAYC and the owner of NFT. Other terms like the smart contract or at OpenSea may apply. However, with terms this grossly vague, it's hard to expect the other conditions to be an improvement or fully resolve all arguments. You'd expect any lawyer with a bit of imagination to have a field day with this.

This is perhaps why Mr Green would love to make a deal rather than meet the current owner of his phished NFTs in court.

The issues with stolen NFTs aren’t so novel

Delorean Photo by Mark Sivewright / Unsplash

Regarding the issue of who “owns” a stolen NFT, you may be surprised that there are precedents. In fact, this problem is so well known that it forms a key part of a first-year contract law student’s learning.

The theory, distilled, is as follows. The original owner didn’t intend to transfer his NFT to a fraudster. There was a mistake that voided his consent to the (smart) contract that operated the transfer. If such a contract is voided, the fraudster had no right to transfer his NFT to his unwitting buyer. The unwitting buyer thus doesn’t own the NFT. The court will order the buyer to transfer the NFT back to the original owner.

We would be short-changing the law students if the issues were so straightforward:

  • The unwitting buyer is also a victim because he bought the NFT without knowing it was stolen. It’s a choice between two victims — either take the NFT from the unwitting buyer or leave the original owner out.
  • What kind of mistake should void consent? Surely, they have to be really big mistakes, right?
  • Is the buyer really a victim? The cost of an NFT is fairly well known. Can one buy an NFT at such a low price that he or she has to know it is part of a criminal enterprise?

It’s even more surprising that you don’t have to travel out of a web3 world to find an example. In Quoine Pte Ltd v B2C2 Ltd [2020] SGCA(I) 2, computers were made to trade Ethereum and Bitcoin at superfast speeds and without human intervention. The code led to unexpected results such that USD285 million in Bitcoin (back then) were contested between two market participants. Was the bug a mistake that allowed one participant to cancel the contracts? The majority of the court said no. The code was doing what everyone intended.

If this was the case, how is hitting the transfer button a mistake? In a decentralized and “trustless” world, a buyer isn’t expecting the identity of a seller to be a material issue in a transaction. Aren’t you supposed to be taking good care of your account yourself anyway? The system is working as expected.

“Working as expected” is the kind of phrase you throw around when you are feeling unkind. Quoine’s dissent is also interesting, and I reproduced it here:

There is nothing surprising, impermissible or unworkable therefore about a test which asks what any reasonable trader would have thought, given knowledge of the particular circumstances.

Three Things: Our Robots made our mistake worseThe plot sounds like something from right out of a movie. In the dead of the night, computers have been doing their thing — buying and selling cryptocurrencies based on maths and science. One morning, a human checks in and realises that something has gone very wrong. A glitch in the algorithm caused…Love.Law.Robots.In Blog version 2020, I wrote about this case.

A reasonable trader, or a reasonable market participant, isn’t an ordinary guy. He represents the best of us, the fairest of us and the guy we need to be when we are tempted by greed, hubris and selfishness.

In a world replete with scams and grifters, perhaps a reasonable person is what cryptocurrency needs.

The building blocks of a major lawsuit are in place

![Lego has been my life since as far back as I can remember, when I was younger I loved building houses, making all the Lego family comfortable in their awesome new home.

Now, I watch my 5 year old nephew delve head first into the infinite possibilities that Lego provides. It’s an opportunity to see what comes from a young mind. It’s awesome. Never grow up.](https://images.unsplash.com/photo-1498747324273-943f73ca00b6?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=MnwxMTc3M3wwfDF8c2VhcmNofDExfHxidWlsZGluZyUyMGJsb2Nrc3xlbnwwfHx8fDE2NTUyNzQxMDA&ixlib=rb-1.2.1&q=80&w=2000)Photo by Hello I'm Nik / Unsplash

In other news, a law firm in Singapore managed to secure a worldwide freezing order over an NFT in a purely commercial dispute (a botched loan agreement). There aren’t any details on how such an order will be enforced — would they serve it on an online marketplace and force them not to process any transactions? In any case, the fact that it succeeded will tempt others to try it themselves.

The more people look to the legal system to enforce what they perceive as their rights, the more opportunities courts will have to comment on them. The outcome might not be what early adopters prefer or expect — a court can hold that it isn’t reasonable to claim that a phished NFT belongs to an unwitting buyer because the code of the smart contract worked as expected. Similarly, cryptocurrency is as decentralised as finding a marketplace which wouldn’t obey court orders.

The key here is that there must be people who value their NFTs enough to request a court to protect their rights. In a bull run, the incentive to do so is muted because it would probably be more profitable to continue investing. In a bear market, when the chips have fallen, promises that have been made must be kept. And that’s when the lawyers come in.

Hopefully at some point, we’d clear the deck of grifters and scam artists, and leave cryptocurrency, NFTs and even maybe the Metaverse with the norms of a sustainable enterprise.

That’s what everyone wants, right?

#tech #TechLawFest #TechnologyLaw #Cryptocurrency #NFT #Contracts #Law #News

Author Portrait Love.Law.Robots. – A blog by Ang Hou Fu