DeFi Common Sense: Crypto-backed Lending in Janesh s/o Rajkumar v Unknown Person ("CHEFPIERRE")

Abstract

One of the selling points of cryptoassets has been the ability to subject them to so-called ‘smart contracts’ embedded upon blockchains; yet, despite numerous common law decisions accepting cryptoassets as property, until Janesh s/o Rajkumar v Unknown Person (“CHEFPIERRE”) no courts have had the occasion to consider how such property (in this case, an NFT) interact with these ‘smart contracts’. The case considers ‘smart contracts’ in the context of decentralised finance (DeFi), thus also raising questions concerning the legal effectiveness and prudence of using cryptoassets as objects of security. Although the non-participation of the defendant meant that the court was deprived of full arguments, the judgment remains worthy of consideration, both for what the court does consider – specifically, criticisms of the Ainsworth test of property – and what it does not.