The power of tokenization
It goes without saying that I'm a big proponent of tokenization. The technology that allows it is in constant evolution, and there is a myriad of potential use cases that can significantly benefit from it, but, unfortunately, we have failed so far in exploring these opportunities.
I thought we had it with NFTs, but that was used mainly for collectibles and games when there is so much more we could have achieved. What a waste.
Don't get me wrong I have nothing against NFT games or collectibles I just think they are probably the less impactant use cases we could have for a concept as powerful as NFTs.
But not all is lost. Every now and then, I read about some new experiment around tokenization, and it gives me hope again that, one day, we will live in a true tokenized society.
Tokenized justice
A Hong Kong court identified two Tron addresses involved in potential illegal activity and sent tokenized legal notices to freeze their assets.
It may not sound like much, but this is actually a big step forward to fighting crime in the crypto space.
Traditionally, the most common method of serving legal documents is in-person service, where documents are physically handed to the recipient. Prior to this, it was challenging, if not impossible, to serve legal documents to wallet holders.
With the tokenization of legal notices, plaintiffs can simply airdrop an NFT into the defendant's crypto wallet, ensuring they were notified even if they are anonymous.
Source: High Court of Hong Kong
Why Tron?
Tron is one of the preferred chains when it comes to illicit crypto actors. According to a report by TRM Tron accounted for almost half of illicit transactions in 2023, which is why Macro Systems, the company behind the technology for the tokenized legal notices started there. However, they already tested their technology on other networks such as Ethereum and Polygon. In theory, it should be possible to use it even on Bitcoin and the company plans to keep expanding their reach.
Challenges
Tokenized justice is promising, but it still faces a multitude of challenges. Lack of awareness and familiarity is the main cause. Many victims of crypto scams don't know how to proceed, and most legal practitioners and institutions are unfamiliar with blockchain technology and its ways of working.
Enforcing is also a big challenge, especially under the current legal framework. The absence of clear, uniform guidelines on using blockchain for legal notifications may create hesitation among courts and lawmakers around the world.
There is also the fact that defendants can simply send NFTs away from their wallets. The record remains forever due to the immutability of blockchain, but it adds another layer of complexity to an already complex situation.
Final thoughts
Tokenization is still vastly underused, but as the adoption of blockchain technology increases, so will the use cases for it.
Despite all the difficulties, some fields are leading the charge in tokenization utilization, and the legal system is one of the latest examples of that.
It's great to see tokenization being employed to solve a real problem that we currently face as a society as opposed to serving only as speculative assets.
Tokenized justice still has a long way to go, but the ability to serve legal notices to wallet addresses involved in potential criminal activity is the first step to modernizing the sector further and bringing it up to speed with the current state of things.
Posted Using INLEO
Oh wow, amazing innovation, Airdrop an NFT as a legal notice to the wallet holder. Yes, that's a really valid challenge, the NFTs can be transferred, although that too can be tracked. However, they can also choose to abandon that wallet so to speak and operate with a new one.
Yup! Still a lot to think about and improve but it's an interesting step
In the lega system, it's all about setting legal precedent
Looks like another way for advertisers to send junk mail to addresses… I understand the premise of serving legal documents in this way but there is still such a long way to go and what’s to stop people using this way of working to scare individuals into giving out information on their anonymity
!BBH
All valid points!
The first one (junk mail) is already a thing, especially on networks with cheap fees
Still a long way to go indeed but it has to start somewhere I guess
So did the Hong Kong court order Tether to freeze the stablecoins of those Tron accounts? I was under the impression that the TRX token itself cannot be frozen, but their associated Tether tokens could be.
For that reason, I thought these anons would be more inclined to use something like DAI on Ethereum, which cannot be censored.
In any case, it's a very interesting way to serve a legal notice.
It seems TRON is the preferred chain for scammers, or at least that's where the data points to.
I also found it interesting. I wanna see where it goes from here