Blockchain solution provider Vleppo has figured out a way for NFT holders to establish and enable their legal rights supposedly inherent to their tokens.
Marrying NFTs with Traditional Contract Law
A long-standing problem confronting the blockchain world and NFT owners is the distinct lack of contractual clarity and legal rights in the enforcement of digital asset transactions. Today, Vleppo and Tokel have successfully conducted a breakthrough digital procedure that will pave the way for the blockchain industry and NFT owners to establish and enable their legal rights embodied in the NFTs and digital transactions to be made legally enforceable in the courts of law around the world.
Founded in 2018, Vleppo is a Web3 blockchain solution provider. Its applications have been focused on developing a Blockchain-integrated suite of business tools for freelancers, SMEs, and enterprises. Tokel is a platform that uses unique nSPV technology to deliver a simple, fast, and easy-to-use Blockchain NFT and token creation system.
In June 2022, Vleppo developed a Blockchain Contract Management System (“CMS”) that enables NFT owners to create a digital contract by embedding their NFT’s on-chain ID directly into the Blockchain record of the same digital contract.
Through this process, the NFT can now act as an immutable evidentiary anchor for the digital contract, forever linking the two together. This link is readily observable because Vleppo’s Blockchain system, called Alysides, which is a customized fork of the Komodo Protocol, is both public and permissionless.
Komodo is a community-oriented project, consisting of a customized version of the Bitcoin protocol (known as the Komodo Protocol) as well as a blockchain running on the Komodo Protocol.
This Vleppo Solution has for the first time finally addressed the longstanding concern of the blockchain industry and NFT owners about the lack of clarity on the legal enforceability of smart contracts as related to NFTs.
According to Chris Sloan, Chair of the Emerging Companies Team at US legal firm Baker Donelson:
“The concept of, for example, embedding an NFT of a song into a Ricardian contract that defines a user’s rights with respect to that song is a nice marriage of the benefits of an NFT in terms of being able to track the distribution of a digital asset like that with traditional contract law.”
For a contract to be legally enforceable it needs to fully satisfy the elements of (1) offer (2) acceptance (3) consideration (4) capacity of the parties to contract and (5) an intention between parties to create and be bound to legal relations.
The first three elements are satisfied by any smart contract. Legal issues arise, however, when attempting to demonstrate that both parties intended to create legal relations and/or have the capacity to contract.
This is because current smart contracts in isolation are incapable of definitively confirming that these qualitative elements of a legally enforceable contract have been met. Therefore, it is common practice for smart contracts to be accompanied by a separate natural contract.
By comparison, a digital contract or smart contract executed in the Vleppo CMS, where the ID of the NFT is embedded into the Blockchain record of the contract, ensures that the link between the NFT and underlying contract cannot be broken.
The Vleppo Solution is Blockchain agnostic as this unique solution delivers legal enforceability enhancement to NFT owners, regardless of whether the NFT is on Ethereum, Polygon, Solana, or any other Blockchain.
Furthermore, because of the Komodo Protocol’s superior design and lack of reliance on ‘gas-style’ transaction fees, Vleppo’s CMS can accommodate even the highly complex contractual arrangements in an affordable and efficient way in comparison to other popular protocols, such as Ethereum.