Follow Us

Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Commercial Litigation Entertainment and Sports Law Regulation

Proposed Changes In UCC Address Virtual Currency Financing

Financial institutions are beginning to accept virtual currencies as collateral for financings. Could this become common for independent film productions and other entertainment industry ventures? This article examines the scope of UCC Article 9 with a focus on virtual currencies, taking into consideration issues of classification and perfection.

X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Virtual currencies continue to gain acceptance in commercial transactions. As a result, financial institutions are beginning to accept such currencies as collateral for financings. Could this become common for independent film productions and other entertainment industry ventures? However, Article 9 of the Uniform Commercial Code (UCC) falls short of providing adequate guidance on how to create or perfect a security interest in virtual currencies. This uncertainty, and the consequent risks to lenders, are further exacerbated by the lack of helpful case law and non-uniform state laws. Recognizing this problem, the Uniform Law Commission and the American Law Institute in 2019 organized the Uniform Commercial Code and Emerging Technologies Committee to consider changes to the UCC intended primarily to address “digital assets” (a term used but not defined by the Code drafters), such as some virtual currencies.

To continue reading,
become a free ALM digital reader

Benefits include:

*May exclude premium content

Read These Next