Corporate Finance News

Mercredi 4 Mai 2016

Delaware Announces Support for Blockchain-based Corporate Shares

Pillsbury named “Legal Ambassador,” “Gold Standard in the Blockchain Space”.

On May 2, 2016, at the second annual Consensus conference in New York, Delaware Governor Jack Markell will announce his support for the creation of a new method of representation of corporate share ownership. In addition to traditional certificated and uncertificated shares, all Delaware corporations (including a majority of the Fortune 500) would have the ability to issue shares using the same technology that underlies the virtual currency Bitcoin.

Pillsbury’s Blockchain Technology focus team has played a leading role in this effort, and it has been publicly designated by Delaware as its “Legal Ambassador” to the blockchain industry. Among other things, the Initiative pertains to the creation of a new type of share registration for Delaware corporations: distributed ledger shares.

This is a significant development in the course of corporate affairs and, we believe, marks the beginning of an inexorable transition to blockchain-based share registration.

Blockchain Technology

A blockchain is a ledger of transactions between parties on a network. The difference between a blockchain and a traditional database is that the ledger is “distributed.” That is, each party on the network maintains a complete copy of the ledger. The parties all participate collectively in the validation and recordation of transactions via a computerized consensus protocol. There is no clearinghouse required to clear and settle those transactions. Thus, a blockchain ledger can efficiently record transactions without costs and delays caused by intermediaries. Though Bitcoin was the first application of blockchain technology, blockchains can also be used to clear, settle, validate and record transactions in any asset that can be digitized, including securities, derivatives, title to real and personal property, health records and legal claims. Blockchain technology has the potential to affect some of the roles currently played by intermediaries in many industries, in the same way that the Internet has changed the roles of intermediaries in many types of transactions.

The Delaware Blockchain Initiative

The Delaware Blockchain Initiative (the “Initiative”) is an outreach effort led by the Governor’s office and Delaware’s Department of State. The immediate elements of the project are:

- the assurance that virtual currency and blockchain businesses will not face new proscriptive regulation in Delaware;
- the Governor’s support for the amendment of Delaware law to accommodate distributed ledger shares;
- the creation of the office of the Blockchain Ombudsman, who will be a point of contact for those seeking to do business using blockchain technology in Delaware;
- the launch of a proof-of-concept with Symbiont – a technology provider and Pillsbury client – to develop distributed ledger solutions for archival records; and
- the naming of Pillsbury as the state’s Legal Ambassador to the industry.

Potential Benefits of Distributed Ledger Shares

The key benefits of blockchain shares are that trades can execute instantaneously, without reliance on intermediaries, and settlement is guaranteed. “T+3” settlement delays need no longer exist. Voting and other governance processes can be included in the blockchain processes. Both publicly traded and privately held companies might benefit from the efficiencies of a blockchain ledger.

Steps to Consider

Pillsbury is working closely with Delaware as it develops its approach to distributed ledger technology and those who will use it in the state. Pillsbury currently serves as a conduit for suggestions, concerns and recommendations to Delaware regarding blockchain technology.

The adoption of blockchain processes will be rapid. Entities incorporated in Delaware or interested in leveraging the benefits of blockchain technology should consider developing a blockchain strategy. Pillsbury can provide strategic counsel; general education on blockchain technologies, benefits, and risks; updates on new developments; and due diligence on potential blockchain technology partners.

Pillsbury Winthrop Shaw Pittman LLP is a leading international law firm with 18 offices around the world and a particular focus on the energy & natural resources, financial services, real estate & construction, and technology sectors. Recognized by Financial Times as one of the most innovative law firms, Pillsbury and its lawyers are highly regarded for their forward-thinking approach, their enthusiasm for collaborating across disciplines and their unsurpassed commercial awareness.

Pour lire tous les articles Finyear dédiés Blockchain rendez-vous sur

Participez aux conférences Blockchain éditées par Finyear :
Blockchain Pitch Day#1 (10 mai 2016)
Blockchain Vision #4 ( 7 juin 2016)
Blockchain Hackathon #1 (octobre 2016)

Finyear est partenaire média de France Blocktech, l'association française de l'écosystème blockchain.

Les médias du groupe Finyear

Lisez gratuitement :

Le quotidien Finyear :
- Finyear Quotidien

La newsletter quotidienne :
- Finyear Newsletter
Recevez chaque matin par mail la newsletter Finyear, une sélection quotidienne des meilleures infos et expertises en Finance innovation, Blockchain révolution & Digital transformation.

Les 6 lettres mensuelles digitales :
- Le Directeur Financier
- Le Trésorier
- Le Credit Manager
- The Chief FinTech Officer
- The Chief Blockchain Officer
- The Chief Digital Officer

Le magazine trimestriel digital :
- Finyear Magazine

Un seul formulaire d'abonnement pour recevoir un avis de publication pour une ou plusieurs lettres

dernières opinions & actus / latest opinions & news