From 5G to a sovereign cloud and the Extended Monaco project, Monaco’s digital transition is well underway. The Principality now has its eye on blockchain. But how to implement this new technology, considered by some the safest data storage technology in the world?
There was a time when people thought it was useless, but even skeptics have now joined the camp. So what exactly is blockchain? In short, blockchain is a fully transparent and secure data storing and sharing technology. For Monaco to become a leader in the field, the country must pave the way for the democratisation of blockchain. “Blockchain will open up new financing methods, thus attracting new companies,” says David de Pariente, partner at the Gordon S. Blair law firm, adding “the Principality must seize this unique opportunity and be ahead of its competitors”.
Getting to grasps with a new economic system
Much like the internet turned sectors upside down and transformed the way we go about the world, blockchain too is expected to make us rethink our systems and habits. Lawyer Thomas Brezzo is a member of Monaco’s National Council and president of the Legislation Commission. He believes it’s high time we stopped being afraid of blockchain. “The technology has often been depicted as a “threat” for the legal profession when actually it would simplify legal procedures, while also being very cheap. We can mention for instance a smart contract, which is executed automatically. However, even if the technology becomes increasingly present and there is widespread adoption of blockchain, the legal profession will never be in danger. We will need the law to regulate the new economic system created by blockchain and there will always be legislative questions to solve,” he adds.
Blockchain and the law
Blockchain is legally recognised since law n° 1.482 for a digital Principality, passed on 17 December 2019. The law was a first step to outline a judicial framework and allow the development of other projects, says Thomas Brezzo: “Law n° 1.491 of 23 June 2020 related to token offers introduced into Monegasque law a legal framework that allows fundraising through digital technology, such as blockchain,” he says.
Welcoming investors, but not at any cost
While more and more countries are encouraging companies to come and invest within their borders, Monaco has moved away from the trend. The Principality refuses to welcome investors at any price. To settle in Monaco, investors and companies will have to meet specific criteria and propose a project that is cohesive with Monaco’s brand.