The Fiduciary Duties of Network Participants of Blockchain Systems

Abstract This chapter reviews and contributes to the debate concerning the fiduciary duties of network participants of blockchain systems, with a focus on software developers and decentralized autonomous organization (DAO) members. After briefly introducing the concept of fiduciary duties in the UK and the US, the chapter surveys the early academic debates on the fiduciary status of core developers. It then turns to an analysis of the main case law in England and California relating to fiduciary duties in this space, before arguing that the imposition of implicit fiduciary duties could lead to unjust outcomes, deter participation in blockchain systems, and stifle innovation. Instead, the remainder of the chapter contends that pursuing co-regulatory efforts which are grounded in the principle of regulatory equivalence, such as the adoption of the COALA DAO Model Law, will secure the public policy objectives of imposing fiduciary duties, without sacrificing the distinctive features of blockchain networks.