Web3 technology is changing the digital landscape. Each benefit it offers comes with a range of unprecedented capabilities and circumstances with few concrete legal guidelines to follow. As Web3 grows, numerous legal challenges will become more apparent and require businesses to seek protection from agile legal firms. Current and predicted legal challenges revolve around areas like:
Data privacy and security: Web3 utilizes a decentralized system where entire networks of computers store data. This approach eliminates a central point of vulnerability, but the databases are often publically visible. Businesses using a decentralized data storage system will have difficulty abiding by privacy laws and regulations.
Intellectual property: The decentralized nature of Web3 will make it more difficult for businesses and creatives to protect trademarks, patents, copyrights and other intellectual property. Intellectual property rights laws must evolve to match new vulnerabilities, and businesses will need to adapt to operate within those new laws.
Central authority and governance: Decentralized virtual environments lack authority figures that uphold laws and regulations. Without an agency enforcing laws in decentralized spaces, businesses using Web3 could be vulnerable to illegal activity. Many disputes will go unresolved, so businesses must find ways to defend themselves.