European Parliament Passes New Data Bill Requiring Smart Contracts to Add Kill Switch
The European Parliament has not been very positive towards the cryptocurrency market. Recently, the parliament has introduced a new Data Act that is going to mandate the requirement of a kill switch for all applications that contain a smart contract.
According to local media outlets, this act was passed recently. It was part of a comprehensive bill that related to the matter of commercial usage of technology.
The bill focused on ensuring data management and promoting the adoption of technology among industrial users. However, it was seeking to ensure that the data reserves collected from the industrial users of such applications remain accessible.
Within the layers of this bill, there is a special provision that deals with making required changes in smart contracts as a legal obligation to achieve these goals.
A close inspection of the Data Act indicates that the European legislatures are working on legalizing access to data from DeFi entities. The bill seeks to collect the required data from the related services that are affiliated with these applications claiming it as fair use.
It means that any application that contains a smart contract and is working in association with other technologies such as IoT and other industrial machines is going to be liable by the decree of this act.
The legislators have noted that more than 80% of the data that is generated from such industrial clients is not used or processed. Therefore, the regulators in Europe are making legal amends that would make for the better use and adoption of such data resources.
The regulators have mentioned that named clients and users will be able to use this data for training algorithms while decreasing the operating costs for various uses such as device repair.
New Data Act and Smart Contracts
This data act is also going to bar the access of the data sources from smart contracts to threat actors and malicious users. As per the statement issued by European lawmakers, the new act requires smart contracts to comply with the new technical requirements to ensure safe termination.
The regulators are mandating that smart contracts must contain all the required internal functions to reset, hinder, or block unwanted data sharing at will.
These internal functions are also going to ensure that any types of unsanctioned and non-consensual data connections are revoked. Professor Thibault Schrepel has shed some light on this matter in his latest tweet.
He claims that the proposed changes in the Data Act can harm the smart contract to such an extent that it is impossible to predict it at present. He has also pointed out the legal hindrances that can be used to dismiss such requirements because it is not determined yet who can decide the data blocks in smart contracts.
