The Urgency of Regulating Blockchain-Based Smart Contracts in International Business Law: Legal Certainty and Global Regulatory Harmonization

Abstract

Blockchain-based smart contracts automate cross-border commercial performance, yet their finality does not by itself resolve questions of consent, validity, liability, applicable law, jurisdiction, evidence, remedies, and enforcement. Existing scholarship generally examines domestic contractual validity or sector-specific digital-asset regulation, leaving insufficient analysis of an integrated transnational framework. This study analyzes the legal status and regulatory urgency of smart contracts in international business law and formulates a harmonization model capable of reconciling code-based execution with legal certainty. It employs normative legal research using statutory, conceptual, comparative, and international-law approaches. Legal instruments and regulatory developments in Indonesia, the United States, the European Union, Singapore, UNCITRAL, and UNIDROIT are analyzed qualitatively. The study finds that functional equivalence and technological neutrality support legal recognition, but fragmented national rules remain inadequate for algorithmic error, oracle failure, code auditing, consumer protection, dispute resolution, and cross-border enforcement. The article proposes Transnational Smart Contract Regulation, an UNCITRAL-oriented model organized around legal recognition, blockchain evidence, electronic signatures, party autonomy, jurisdiction, code auditing, cybersecurity, digital consumer protection, online dispute resolution, and enforcement. Its novelty lies in integrating legal certainty, harmonization, and law-and-technology theories into a risk-based regulatory architecture that preserves innovation while ensuring intelligible consent, accountability, corrective intervention, and interoperable remedies.