EU's Data Act Vote Sparks Controversy in Web3 World, Raising Concerns for Smart Contracts

Experts and members of the Web3 community are currently discussing the idea of including kill switches in smart contracts, as new data controls demand it.

As stated in a report from CoinDesk, the European Parliament has approved the implementation of fresh data regulations that may require the placement of "kill switches" in smart contracts in order to cease or reset activities. Dubbed the Data Act, the 2022 EU bill strives to offer folks more control over data produced by their smart devices. Even so, the Web3 community has expressed their disfavor of the legislation. On Tuesday, March 14, the European Parliament voted on the Data Act. A total of 500 Parliament members were in favor, 23 were opposed, and 110 abstained.

While talking about the bill, Pilar del Castillo Vera, who is the main lawmaker in charge, highlighted that the new rules will give consumers and companies the power to manage how data generated by interconnected devices is utilized. However, the suggested clauses in the bill have worried many people involved in the Web3 community.

The updated proposal put forth by del Castillo Vera mandates that smart contracts should come equipped with protective measures to safeguard trade secrets and access controls. Additionally, they must have the capabilities to reset or terminate. However, professionals are worried that these actions may impede the fundamental aspect of smart contracts.

There were people who disagreed with the suggested laws. Thibault Schrepel, who specializes in laws for blockchain technology and works as a professor at VU Amsterdam University, shared his concerns about the laws in a tweet before they were voted on. Schrepel thought that the rules in Article 30 were too strict when dealing with the challenges of immutability. This could put the safety of smart contracts in danger in a way that is difficult to predict.

Additionally, Schrepel pointed out that the wording in the bill relating to the individual who has the responsibility of initiating a kill switch on a smart contract is not clear. He suggests that this creates a disagreement with the underlying principle that automated programs ought not to be modified by anyone.

Are Smart Contracts at Risk? The EU's Vote on the Data Act Causes Controversy in the Web3 Community.

The thoughts and beliefs shared by the writer or any individuals cited in this piece serve only to inform and do not offer financial, investment, or any other type of guidance. Risk of loss of funds is a possibility when investing in or trading cryptoassets.