Challenges and Solutions for Establishing the Parties’ Intent in Blockchain-Based Contracts under Iranian and European Law

Abstract

Blockchain-based contracts, as a new generation of digital obligations, provide a self-executing and decentralized method for structuring contractual relationships, in which the role of human will is fundamentally transformed when confronted with automated mechanisms. In this context, establishing the parties’ intent—one of the identity-defining elements of any legal agreement—faces challenges such as user anonymity, disintermediation, reliance on pre-determined code, and difficulties in identifying the moment and content of consent. The main issue addressed by this research is how a valid and legally attributable intent of the parties can be established in blockchain contracts under Iranian and European law, and what conflicts arise between traditional doctrines of intention and consent and technological mechanisms. This study adopts a descriptive–analytical method with a comparative approach. Data were collected through the examination of statutory instruments, specialized technology regulations, judicial decisions, and up-to-date scholarly literature. The analytical tools include a limited empirical review of sample smart contracts, legal analysis of code, and a comparative interpretation between classical contract law principles and European Union regulations. The findings indicate that although blockchain technology offers transparency, immutable record-keeping, and automation of obligations, shortcomings such as the lack of reliable identity verification, the possibility of programming errors, difficulties in applying traditional theories of intent, and conflicts between code and the parties’ actual will create serious ambiguities in establishing consent. The study proposes the adoption of supplementary regulations on digital identity verification, mandatory inclusion of declaratory layers, the possibility of judicial review of code, and the development of integrated frameworks bridging technology and law, in order to strike a balance between automation and human intent.