Virtual assets through the prism of international private law

Abstract

The research is devoted to the study of the legal nature of virtual assets and the specific features of their conflict-of-laws regulation within the system of private international law. The rapid development of digital technologies, in particular blockchain, crypto­currencies, tokens, NFTs, and smart contracts, has led to the emergence of new objects of civil legal relations that are actively used in cross-border transactions and therefore require appropriate legal regulation. In this context, the issue of determining the legal status of virtual assets and the applicable law governing the relevant legal relations, comp­licated by a foreign element, becomes particularly relevant. The research provides a comparative legal analysis of the statutory definitions of the concept of "Virtual Asset" in Ukraine, the European Union, Poland, the United States, Germany, and Norway. Special attention is paid to the Law of Ukraine «On Virtual Assets», which recognizes virtual assets as objects of civil rights, as well as to the amendments to the Civil Code of Ukraine introducing the category of "digital objects". It is established that, unlike the Ukrainian approach, EU legislation predo­minantly treats crypto-assets as a digital repre­sentation of value or rights without granting them the status of objects of civil rights. The possibility of applying traditional conflict-of-laws connecting factors, in particular lex rei sitae, to determining the legal status of virtual assets is analyzed, and their inadequacy is substantiated in view of the intangible and decentralized nature of such assets. The current conflict-of-laws approaches to transactions involving virtual assets under Ukrainian law and EU law are examined, including the connecting factors of lex voluntatis and the law of the closest connection. Possible alternative conflict-of-laws criteria for determining the legal status of virtual assets are proposed, including the law of the place of business of the service provider, the personal law of the virtual asset holder, or the law of the place of operation of the distributed ledger. The article concludes by emphasizing the need for further development and legislative consolidation of special conflict-of-laws rules governing virtual assets.