It is a common complaint, from inventors and lawyers alike, that the law tends to have trouble keeping up with new technologies, especially when they become widespread and assimilated in unexpected ways. It is certainly true that applying decades old statutes in new contexts can present substantial challenges. But sometimes, once the tech trappings are stripped away from the latest shiny new thing, courts find a familiar structure underneath and the applicable law becomes more clear.

An example of this arose recently in the world of crypto. The term "crypto" refers to a class of digital assets (including cryptocurrencies and non-fungible tokens or NFTs) backed by an unalterable digital ledger called a "blockchain". No single person or entity controls the blockchain—it is "distributed" among multiple servers—and every transaction in the associated asset is recorded on it. It is functionally impossible to alter, delete, or destroy records once they are entered on the blockchain. In theory, this system permits the creation of a digital asset that can be tied to an "owner" (who may remain anonymous) and never counterfeited. A "cryptocurrency" (such as Bitcoin) is a digital asset backed by a blockchain, intended for use as an investment or to purchase goods and services. (Other systems, such as NFTs, attempt to use blockchain technology to guarantee "uniqueness" of a digital object or backstop intellectual property or contractual rights.)

At first glance, cryptocurrency would seem to present many of the classic difficulties faced by courts assessing new technologies. It is generally a purely non-tangible asset, often developed by companies or individuals with limited presence in the United States. Many cryptocurrencies are designed to be untraceable or anonymous, and transactions in them are, by definition, highly distributed—spread out over computers and servers around the world. Courts must therefore ask some basic questions: where are cryptocurrencies "located?" Where do transactions involving them take place, and where can they be regulated? These new assets also present definitional questions: what is cryptocurrency and which legacy statutes apply to it? Is it a currency? A commodity? A security? What form of regulation is most applicable to this new construct?