The first legally enforceable smart contract on the Cardano network was signed and is currently under the jurisdiction of the courts in Argentina.
Cardano is the site of the first smart contract in which Argentina’s courts have authority, following the country’s legalization of crypto as a payment mechanism in commercial contracts last December.
Cardano Hosts Smart Contract In Argentina
The contract is a loan agreement between Cardano ambassadors Mauro Andreoli and Lucas Macchia for 10,000 Cardano tokens valued at $3,380. The loan is due in four months at a 10% interest rate.
Andreoli clarified in an Oct. 8 X post that this is the first instance in which an Argentine court has used a Cardano smart contract to enforce complete payment in ADA.
“We did it, we have just signed the first legally and judicially enforceable contract on the Cardano network, in full compliance with the laws of the Argentine Republic.”
Additionally, Andreoli and Macchia executed a legal document that substantiated the core details of the smart contract loan, such as the transaction ID, blockchain, and wallet.
Andreoli stated that the “milestone” could expedite the process of Argentine courts more extensively acknowledging smart contracts as a technology that facilitates commercial agreements.
“Legally, this establishes evidence and streamlines procedural steps, marking the initial phase of creating favorable jurisprudence in the country and facilitating commercial transactions.”
He also mentioned that these smart contracts can be implemented in purchase agreements, rental agreements, or other legal contracts.
Argentina has a “robust legal framework” for commercial contracts, but Andreoli stated that the next step is educating justices.
The use of Bitcoin and other cryptocurrencies in commercial contracts was legalized in Argentina in December 2023, 10 days after the anti-central bank libertarian Javier Milei assumed the presidency.
The contract is executed before the Cardano Summit 2024 in Buenos Aires, where Milei is scheduled to meet with Cardano’s founder, Charles Hoskinson, later this month.
Crypto technology has been incorporated into legal proceedings in other justice systems.
In August 2023, a United States court employed an enforcement tool on a blockchain to prevent several sanctioned individuals from accessing their crypto purses.
The High Court of England and Wales permitted using a non-fungible token (NFT) to convey a lawsuit to a defendant in 2022.
As the defendants were unknown, a Florida federal court also permitted the service of a lawsuit via an NFT to the wallets of alleged crypto thieves later that year.
