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Smart Contract Accountability Problems: Default Oracle Liability as the Solution

Leana Ter-Martirosyan

Columbia Business Law Review2025https://doi.org/10.52214/cblr.v2025i1.14257article
ABDC A
Weight
0.37

Abstract

Smart contracts have emerged as a transformative force in contract law, leveraging blockchain technology to automate transactions and reduce reliance on human intermediaries. However, their widespread adoption is hindered by significant legal challenges, particularly in determining liability for transaction failures. This Note examines the accountability problems inherent in smart contracts, focusing on the critical role of oracles—third-party entities that feed external data into blockchain-based agreements. While existing scholarship explores the theoretical foundations and potential applications of smart contracts, this Note shifts focus to liability allocation and proposes a novel framework: default oracle liability. Under this proposal, oracles bear primary responsibility for transaction errors arising from inaccurate data sourcing or validation failures. If oracles demonstrate that they functioned correctly, liability shifts to smart contract developers, who are responsible for ensuring secure and error-free code. By clarifying accountability, this framework incentivizes higher standards for data accuracy and software integrity, ultimately fostering a more reliable and legally-viable environment for smart contracts to operate.

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https://doi.org/https://doi.org/10.52214/cblr.v2025i1.14257

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@article{leana2025,
  title        = {{Smart Contract Accountability Problems: Default Oracle Liability as the Solution}},
  author       = {Leana Ter-Martirosyan},
  journal      = {Columbia Business Law Review},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.52214/cblr.v2025i1.14257},
}

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Smart Contract Accountability Problems: Default Oracle Liability as the Solution

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Evidence weight

0.37

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.16 × 0.4 = 0.06
M · momentum0.53 × 0.15 = 0.08
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.