How should blockchain evidence be used in practice?

Blockchain evidence deposition, opportunities and challenges.

On June 16, 2021, the People’s Court Online Litigation Rules were released, which will officially come into effect on August 1. The Rules define for the first time the scope of blockchain deposition validity and review criteria in Articles 16 to 19. As stated in the official document, this will help parties to actively use blockchain technology to solve the dilemma of “difficult to deposit” and “difficult to authenticate” electronic data. At a time when the number of litigation cases involving blockchain technology is gradually increasing and blockchain evidence is widely used in judicial practice, the release of the Rules undoubtedly provides clear guidelines for the review of blockchain evidence and indicates the direction of preparation and strategies for parties who are prepared to use blockchain evidence for litigation. The following Sara team analyzes these four articles one by one to show some issues that need to be noted when blockchain evidence is used in practice.

Article 16: If the electronic data submitted by the parties as evidence is stored through blockchain technology and verified by technical verification, the people’s court may determine that the electronic data has not been tampered with after the chain, except where there is sufficient evidence to the contrary.

This provision clarifies that the essence of blockchain evidence is still electronic data, and presumes the authenticity of blockchain evidence after it has been chained. The disruptive nature of blockchain electronic data is being reflected in the dilemma of traditional electronic data. In the past, although China established early electronic data as a kind of legal evidence, but electronic data in judicial practice encountered a series of difficulties, the judge is quite conservative and cautious in its application. According to Professor Liu Pinxin’s research, “the vast majority of the court did not explicitly make a judgment on the admissibility of electronic evidence, accounting for 92.8%; only a few explicitly made a judgment on the admissibility, accounting for only 7.2%” (Liu Pinxin, “Corroboration and Probability: The Objectified Admissibility of Electronic Evidence,” Global Law Review, 2017, No. 4, p. 110). No. 4, 2017, p. 110.)

The reason for this is that, first, the grassroots people’s courts often lack the technical ability to identify the authenticity of electronic data, even if sent to the judicial appraisal institute also cost a higher cost; second, the traditional electronic data is vulnerable to tampering characteristics. Therefore, “electronic data provisions” on electronic data extraction, collection, transfer, production and so on the establishment of a nanny type of cumbersome rules. A little inattentive, the relevant evidence will have to be corrected, or even mandatory exclusion. In order to circumvent these cumbersome rules, and even the electronic data into documentary evidence, physical evidence to use the “alienation” situation.

And blockchain more properly solve these two problems: on the one hand, the blockchain application is simple and widespread, only need to verify the hash value and so on can quickly grasp the electronic data has no change; on the other hand, unless encountered 51% of the arithmetic attack, the electronic data on the chain is basically safe, can not be tampered with. Therefore, the parties only need to ensure that the blockchain evidence before the chain is real and relevant to the case, the relevant evidence is difficult to be excluded from the application of the court.

Article 17 Where the parties object to the authenticity of the electronic data stored by blockchain technology after it has been chained and have reasonable grounds, the people’s court shall make a judgment by combining the following factors.

(a) Whether the deposition platform complies with the relevant provisions of the relevant state departments on the provision of blockchain deposition services.

(ii) whether the party has an interest in the deposition platform and uses technical means to improperly interfere with the process of deposition and forensics; and

(iii) whether the information system of the depository platform complies with national standards or industry standards for cleanliness, security, reliability and availability

(d) whether the deposition technology and process meet the requirements of relevant national standards or industry standards on system environment, technical security, encryption methods, data transmission, information verification, etc.

Of course, nothing is absolute. At present, commercial blockchain e-deposit platforms coexist with official blockchain e-deposit platforms. In the future, if blockchain evidence is widely adopted by the court, it will force the parties to generally choose blockchain for electronic data deposition, and then commercial blockchain electronic deposition platforms may spring up. At this point, it is necessary to consider the problem of uneven platforms. In this regard, Article 17 of the “Rules” puts forward some requirements for blockchain electronic depository platforms.

These requirements are not a raw face, but a summary of past case court arguments. For example, in the “blockchain evidence first case”, Hangzhou Internet Court focused on the review of the platform and the case in the relationship between the interests, its judgment in the discussion, the depository platform company shareholders and business scope is relatively independent of the parties, with neutrality, and through the integrity of the National Network and Information Security Product Quality Supervision and Inspection Center Identification testing, with the qualification as a third-party electronic depository platform.

As another counter-example, in a second instance judgment [(2019) Chuan 01 Min Final 1050], although the third-party blockchain electronic depository platform has industry-recognized standards such as “Information Security Management System Certification”, “Information System Security Level Protection Record Certification”, and “Electronic Certification Products and Services Authorization”, it lacks the certification license certificate issued by the competent department of information industry under the State Council. Therefore, it was denied by the court of second instance to have the ability of electronic authentication services, and the relevant case was reversed in the second instance. (Although the blockchain evidence deposited by the platform has been recognized in other cases)

Therefore, in the future, when parties use blockchain evidence to prove the facts of a case, they should combine the above factors for comprehensive consideration and ensure that the depositing platform is a platform with complete relevant certificates and national certification licenses.

Article 18 If the parties propose that the electronic data no longer has authenticity before being stored on the chain and provide evidence to prove or explain the reasons, the people’s court shall review it.

According to the case, the people’s court may require the party that submits electronic data stored in blockchain technology to provide evidence to prove the authenticity of the data before storage on the chain, and make a comprehensive judgment by combining the specific source of data before storage on the chain, the generation mechanism, the storage process, notary public, third-party witness, and associated corroboration data. If the parties cannot provide evidence to prove or make reasonable explanation, and the electronic data cannot be corroborated with other evidence, the people’s court will not confirm its authenticity.

The provision reminds blockchain evidence of the original malice is its lingering shadow. It is best for the parties to sit on the authenticity of the data before it goes on the chain by means of notarization and other means, with the endorsement of the notary platform. However, it is worth noting that even so, the judicial interpretation does not impose an excessive burden of proof on the party providing blockchain evidence. On the one hand, the presumption of authenticity is still valid and requires the other party to first present some evidence or reasons for not having authenticity before the chain; on the other hand, even if the party providing blockchain evidence has difficulty in stating reasonable reasons, the court will not overturn the presumption of authenticity as long as the electronic data and other evidence corroborate each other.

Article 19 The parties may apply for a person with specialized knowledge to give opinions on technical issues related to blockchain technology for storing electronic data. The people’s court may, upon the application of the parties or ex officio, entrust the authenticity of the electronic data stored in the blockchain technology, or retrieve other relevant evidence for verification.

In the past, people with specialized knowledge (or expert support persons) mainly appeared for experts and appraisal opinions. For example, Article 79 of the Civil Procedure Law provides that a party may apply to the people’s court to notify a person with specialized knowledge to appear before the court to give an opinion on the expert opinion made by the expert or on professional issues. Article 197 of the Criminal Procedure Law provides that the public prosecutor, the party and the defense and litigation agent may apply to the court to notify the appearance of a person with specialized knowledge to give an opinion on the appraisal opinion made by the expert. However, since blockchain is a new technology, its related issues have too much room for discussion in technical terms. Therefore, this article broadens the conditions for the appearance of persons with specialized knowledge to testify.

Write in the end

The impact of blockchain technology on electronic data review judgment is far-reaching. The most difficult problem of authenticity of traditional electronic data has been solved with the help of blockchain technology, and it has even achieved the presumption of judicial validity, in which it can be said that blockchain technology has deeply changed the ecology of traditional electronic data. However, the general use of blockchain electronic evidence in the future may bring problems such as over-exaggerating the probative power of blockchain evidence, the uneven standards of third-party platforms, and the increasing severity of the “original malice” of the evidence before the chain. Therefore, while we appreciate the convenience and efficiency brought by blockchain technology, we should still face the problems that may be brought by the change rationally. The parties who wish to prove the facts of the case through blockchain evidence in the future should actively make pre-trial preparations with relevant regulations to ensure that the legality and authenticity of blockchain evidence can be recognized by the court; and the blockchain technology companies who intend to enter the field of judicial depository should pay more attention to the relevant compliance and criminal risks.

This article is the theoretical research of Sara’s team, not as investment advice or legislative advice, welcome to leave a message to discuss. The above is today’s share, thanks to the readers!

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