Chamber and committees

I listened to a lot of the witnesses who you heard from, and a lot of important and pertinent points were made not only about what is in the bill and the purposes of the legislation, but about some of the wider issues that arise from it.

There were legal voices, as well as other voices offering a more technological perspective. It is important to note that those from the expert reference group who gave evidence, as well as those from the Law Society of Scotland and the Faculty of Advocates, who were focused more on the legal aspects of the bill—the bill has a limited scope and focuses on giving legal certainty to digital assets as property—felt, virtually unanimously, that this is an important bill, that there is a need for it and that it achieves what it is setting out to achieve.

Some of the other issues that were raised were addressed by the witnesses who support the bill. However, there might be a wider debate beyond that. The bill cannot deal with everything, as it has a narrow focus. There were lots of issues to do with blockchain technology and all manner of issues on the margins, and that there might also be debates that arise on the margins of the bill. However, as I mentioned, I think that that was more of a debate around technology and the bill is not an appropriate place to address some of those issues.

That would be a case for the wider legal system. All that the bill is dealing with is identifying what is property. If you sell something to Willie Coffey that belongs to Lorna Slater, Willie Coffey would own the property. You would have sold it when you should not have; therefore, in theory, you could be sued for damages by Lorna Slater. That would be for the wider legal system; it is not for the bill to determine that. The bill simply determines what is property.

Those concerns do not have a direct relationship with this bill, but there is wider development of policy around data centres in Scotland, equipping Scotland for the future and the AI revolution. As you say, the more digital the world becomes, the greater the demand for energy. Our policy is to have green energy data centres in Scotland. We have already seen CoreWeave proposing to establish a data centre in Scotland, and we will see how that develops over time. The company chose Scotland because of our renewable energy potential and has said that publicly.

You are right that a wider digital revolution is taking place and that we must ensure, for environmental reasons, that we deal properly with that big energy footprint. You will be aware that that is a global issue and that a significant percentage of the world’s energy is now being used for data centres. Our policy is to try to utilise our renewable energy potential to have green data centres, because we have that advantage.

I certainly did not.

The bill arises from Scots law, which has been around for centuries as part of our distinctive legal system. The bill will be recognised by the legal profession, at whom it is primarily aimed, and by the courts—it is for the courts as well. The issue that you raise, regarding ensuring that laws are accessible and use language that the public understands, applies to many acts of Parliament. I can sympathise with that, but, at the same time, legislation must be legally sound.

We will ensure that the explanatory notes, which are more likely to be used by the public than the act of Parliament would be, are very clear in explaining what everything means.

I ask Fraser Gough to come in on the point about acquisition.

I read some of the evidence that you got on that, so thanks for raising that. Absolutely—we could consider that issue further. As you say, there is a distinctive Scottish legal system and there may be distinctive Scottish considerations overall. Our position is that we are open minded to that. Clearly, if the committee has a view, we will take that on board. We read that evidence with interest and we have an open mind.

I think that that is right. Some of the issues around carbon credits are pertinent, irrespective of whether they are tokenised and turned into digital assets. These debates are about whether they should be property, as opposed to whether they are a digital asset. The general point is correct in that this area will develop and become bigger. At the moment, 12 per cent of the population hold digital assets, so who knows where we will be in a few years’ time and what the implications of that will be. We have to pay attention to that issue, as you say.

The issue involves taking the key principles that we have in society for property and translating them into the digital world, so that those assets are recognised as property in the traditional way. That is why the bill contains the key principles that the expert reference group laid down: they are the key principles that we should follow when trying to classify something as property.

I am not sure what you mean when you talk about the arguments that the proposal would lead to the creation of more cryptocurrencies. I am just trying to get my head around that.

The approach that we are taking is the correct one. Commercial activity is already taking place out there and the purpose of the bill is to recognise that. We therefore have to give legal certainty to it. The third-last Lord Advocate, or whoever it was, commissioned the expert reference group in the first place, because this is already happening in society. We need to give legal certainty to the trading of digital assets and recognise them as property in the way that we recognise other assets. That is what the bill deals with.

Some of the witnesses who the committee heard from, including members of the reference group, said that things will change in the future and the Parliament will have to return to the issue. However, at the moment, there is a requirement to deal with this specific issue, and the bill does the job.

The situation is evolving fast and the law will have to be agile in future because we can see where the world of technology and digital transactions is going. I cannot sit here and predict what the big issues will be in the next few years, but there will be greater need to understand the implications for Scots law, as Fraser Gough said. This is a global phenomenon and Governments around the world are wrestling with it.