First of all, on behalf of the entire team at Graś i Wspólnicy sp. k. Law Firm, I would like to welcome you to our blog dedicated to the broadly defined law of new technologies. Starting today, every Thursday, we will publish posts by our lawyers on legal topics related to blockchain technology, copyright, industrial property law, and the legal aspects of AML (anti-money laundering).
We're kicking off our series with an introductory post on the legal aspects of blockchain technology. Today, we'll address a fundamental question: what are cryptographic tokens, and what types exist?
Cryptographic tokens are created using blockchain technology. These tokens can be defined as digital objects that represent the right to perform a specific action.
There are three types of tokens. The division criterion is their function in circulation, which also influences their legal assessment:
- utility tokens
- payment tokens
- investment tokens (security)
Utility tokens are most similar to tokens of legitimacy within the meaning of Article 921 15 of the Civil Code. They most often provide their holder with access to resources offered by a given website or platform that are not available to individuals without the appropriate token. These tokens are most often issued by entities operating the website or platform.
Payment tokens (also known as virtual currencies), of which Bitcoin has gained the most popularity, are, like traditional currencies, intended to be used to purchase goods or services. The fundamental difference between payment tokens and the classic means of payment, such as money, is the issuer. In the case of payment tokens, the issuers are typically private entities not authorized to issue official means of payment. Therefore, payment tokens do not have the legal power to redeem incurred liabilities. Virtual currencies are also characterized by their highly volatile value and are not issued with an obligation to redeem the issuer.
Investment tokens, on the other hand, incorporate rights that are similar to financial instruments, including securities. It is generally accepted that Polish law adheres to the principle of a closed list of securities. Only by rejecting the prevailing position in this regard can a given token be considered a security, assuming that it incorporates rights similar to, for example, shares.
Our law firm had the pleasure of providing legal advice on the innovative Need for Game Idea platform ( https://www.pway.io/ ), the world's first platform using blockchain technology to collect video game ideas from players around the world. For submitting a game idea, users receive one Pway token. If their idea is implemented and the game goes on sale, they can expect to receive a share of the game's profits, paid out in the form of Pway tokens.
Thank you very much for your time and attention. We invite you to follow our blog; next week we will publish another post, this time on copyright law.
This post does not constitute legal advice.
