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The Hague Conference on Private International Law (HCCH) Project
The HCCH has launched a project focusing on digital asset tokenization to provide legal clarity for cross-border businesses dealing with digital assets.
Scope of the Project
- The project will cover various digital token types.
- It will address legal questions related to digital securities and blockchain-based asset management.
Objectives of the Project
The goal is to determine the applicable laws for cross-border businesses and ensure international legal enforcement.
CGAP Study Proposal on Private International Law Challenges
A proposal suggests that the Council on General Affairs and Policy (CGAP) conduct a study on the legal implications of digital tokens in private international law.
Focus Areas of the Study
- The study will cover real estate tokens, utility tokens, payment tokens, NFTs, and stablecoins.
- It will exclude securities, central bank digital currencies, and carbon credits due to ongoing separate projects.
Expected Outcome
The study aims to present a report with recommendations to the CGAP during a scheduled meeting in 2025.
Joint Project with UNIDROIT
The HCCH collaborated with the International Institute for the Unification of Private Law (UNIDROIT) on a joint project following the adoption of digital asset principles in 2023.
Key Areas of Focus
- Applying existing custody rules beyond traditional custody scenarios.
- Exploring the legal implications of “linked assets” or tokenized assets.
Interest in Tokenization by Financial Institutions
Established financial institutions are showing increasing interest in tokenization.
Industry Insights
Moody’s highlighted a significant increase in the value of tokenized funds driven by US treasury tokenization. Bank of America predicts a transformative impact of tokenization on financial and non-financial markets in the coming years.
