ROLE OF SMART CONTRACT IN ARBITRATION: A CRITIQUE

Abstract

Smart contracts are programmable agreements that can be executed reliably by a network of mutually distrusting nodes without the involvement of a central authority. Integrated into blockchain systems, smart contracts enable the automatic enforcement of agreement terms, eliminating the need for intermediaries. The ongoing technological revolution has significantly impacted various sectors, including the legal domain and its complementary dispute-resolution mechanisms. This article aims to achieve three objectives. First, it explores the arbitral framework, highlighting that it does not explicitly prohibit the incorporation of emerging technologies into arbitral proceedings. Second, it examines the interplay between arbitration and advanced technologies such as blockchain, smart contracts, big data, artificial intelligence, and cryptocurrencies. It posits that while technological advancements enhance and streamline dispute resolution, arbitration serves as a safeguard for the tech industry and its innovations. Key features of blockchain technology—decentralization, self-regulation, peer-to-peer networks, immutable records, and timestamps—make it one of the most transformative innovations of our time. This discussion focuses on the application of blockchain technology in digitizing land records within the Indian context. However, the limited adoption of smart contracts is largely attributed to uncertainties surrounding their enforceability under current state contract laws.