In Argentina, smart contracts acquire legal value thanks to Cardano

The Cardano blockchain has just hosted the launch of the first legally recognized smart contract by the courts in Argentina.

This is a turning point for the adoption of cryptographic technology in the country as it introduces a new fully legal trading system.

It is not the first time that Argentina has opened up to innovation: in December 2023 the government legalized the use of Bitcoin and other crypto.

Let’s see all the details below.

Launched the first smart contract legally recognized by the courts in Argentina

As anticipated, in Argentina the first smart contract recognized by law has just been signed, thanks to the participation of the blockchain of Cardano.

We are talking about a simple loan agreement, in which the counterparties are two well-known ambassadors of the cryptographic Foundation, namely Mauro Andreoli and Lucas Macchia.

The two have agreed on a loan of 10,000 Cardano (ADA), equivalent to 3,380 dollars, payable in 4 months with an interest rate of 10%.

As explained by Andreoli himself in a post on X, the court can impose the full repayment of the loan in ADA, based on the data from the smart contract.

This means that, thanks to the legal framework provided in Argentina, any violation of the agreement can be enforced by a judge.

In signing the loan, Andreoli and Macchia also signed an accompanying legal document. In this document, some key details of the smart contract are explained, including the portafogli used and the transaction ID.

The document also contains private data of the two Cardano ambassadors, such as home address, document numbers, and more.

By doing so, combining the agnostic power of the blockchain with the legal power of the Argentine courts, the first hybrid, partially decentralized commercial agreement is introduced.

According to Andreoli, this represents the first precursor step for a future made of smart contracts in Argentina,

It will, however, be necessary to start educating judges in computer science, who will need to know how to read what is hidden by the virtual contract to enforce the law.

Smart contracts could invade the world of commercial agreements in Argentina thanks to Cardano

Thanks to this first intervention by Cardano, it is possible that in the future smart contracts will accompany a wide range of commercial transactions in Argentina.

Basically, the country has a solid legal framework for contracts, based on the Civil Code and the presidential decree 70/23 issued by President Milei.

The application of Argentine jurisdictional rules above these computer contracts simplifies procedural bureaucracy and facilitates the exchange phases.

It is not excluded that in the coming years we might see more and more Cardano smart contracts opening up to new types of agreements, such as rentals and leases.

As Andreoli reports on this subject:

“Legally, this establishes evidence and simplifies procedural stages, marking the initial phase of creating favorable jurisprudence in the country and facilitating commercial transactions”.

Argentina is also not the only country whose courts have begun to recognize the value of blockchain technology in the execution of judicial proceedings

In August 2023, a court in the United States used a control tool on a blockchain to block several sanctioned individuals from their crypto wallets.

In 2022, the High Court of England and Wales allowed the use of an NFT to serve a lawsuit to a defendant.

Also in that year, a Florida court allowed the notification of a lawsuit via NFT, as the defendants involved were unknown.

We expect that in Argentina in the next year several new agreements will be signed, under the protective wing of Cardano smart contracts.

Cardano and its strong presence in Argentina

Cardano had already made its steps in Argentina, even before launching a legally recognized smart contract.

Under the Milei government, there have been several occasions when the representatives of the crypto project have participated in technological initiatives.

Basically, there is the approval of the Argentine government, which less than a year ago began to support the world of cryptocurrencies.

In December 2023, Argentina has indeed legalized the use of Bitcoin and other digital currencies in commercial contracts, following in the footsteps of El Salvador.

In April of this year, President Milei introduced the mandatory registration process for crypto platforms, establishing a dedicated registry (VASP).

The opening of the country towards the blockchain world was immediately met with enthusiasm by Cardano, which took advantage by launching pilot projects.

The presence of Cardano and the cryptocurrency ADA is well established in the South American country, and it is reaching a significant portion of the population.

At the end of the month, a meeting is expected between the founder of Cardano Charles Hoskinson and Milei under the framework of the capital Buenos Aires.

From here, further initiatives could be launched, aimed at supporting Cardano smart contracts in the financial world of commercial agreements.

 Cardano (ADA): analysis and price forecast

The debut of the first Cardano smart contract recognized by the courts in Argentina does not seem to have influenced the trend of the crypto ADA.

The cryptocurrency is indeed down by about 2% over the last 24 hours with a price at the time of writing of 0.33 dollars per unit.

Cardano maintains the 11th position in the ranking of the most capitalized projects (recently dropped from the top10) with a market cap of 11.8 billion dollars.

ADA is in a downtrend phase since March, ever since it reached the local high of 0.75 dollars per coin.

Since then, we have witnessed trading with decreasing highs and lows, up until the last few weeks where the decline seems to have slightly eased.

If ADA manages to bounce from the 0.3 dollar area, convincingly establishing the local bottom, then we might observe a recovery of prices.

The first significant target is 0.4 dollars, where several sell orders from the bear are positioned.

Above 0.5 dollars, the chart would take on a completely different form and would once again accompany a bullish spirit among traders.

In any case, the true bull market would be definitively opened as soon as Cardano’s coin surpasses the 0.8 dollar hurdle.

Until then, let’s expect a lot of volatility and possible bear tricks.