Your unique warehouse receipt identifier is the transaction hash of your Ethereum wallet against the LD2.Zero smart contract, located at 0x2f5cdc81a729b750f3b733cb95660e788441c71e
Each warehouse receipt represented by EACH WHOLE XLDZ token is valid only to the bearer for one (1) troy ounce of .999 fine silver stored at the warehouse identified below shall expire unless renewed or surrendered within (10) years from date of issue. The undersigned warehouse official certifies that this silver is insured against fire and theft, storage and insurance fees have been prepaid for ten (10) years from date of issue. Thereafter, storage and insurance fees are one percent (1%) per year of the value of silver prorated at the time of surrender. Additional fees limited to shipping and handling may be incurred upon surrender of this warehouse receipt.
Date of Issuance: May-14-2018 08:25:56 PM +UTC
Warehouse Official: 0xb890a5934f2fd3071730ce62c2c5a09ec188ab69
Warehouse Location: Sunshine Minting, Las Vegas, Nevada, USA
Balance Certification: 0xa0023a464729286cd766fa9656c6947a15655beba262521569cdb4e05a05196e
A LD2 token is a digital warehouse receipt and represents a contract made in accordance with the Uniform Commercial Code (“UCC”). The UCC is a uniform act put into law in an effort to standardize commercial transactions. It has been adopted by all 50 states, the District of Columbia, and the vast majority of U.S. territories [source]. In addition to the UCC, other national and international legislation provides groundwork for digital contracts made under the LD2 token model.
The Uniform Electronic Transactions Act (UETA) and Electronic Signatures in Global and National Commerce Act (E-Sign Act) both support agreements to conduct business by electronic means and electronic signatures. Subsequent US court cases have upheld the validity of such transactions.1 Beyond the United States, electronic signatures are valid and legally binding throughout the majority of countries around the world. Blockchain transactions are signed in a way that establishes this electronic signature.
Control of Electronic Document of Title
UCC § 7-106 specifies the following terms to define a person’s control of an electronic document of title. It states that the system must be one that:
- “reliably establishes [the owner] as the person to which to which the electronic document was issued or transferred”
- Provides “a single authoritative copy of the document” that is “unique, identifiable… and unalterable” (which can be converted to/from a digital medium per UCC § 7-105)
- Identifies the person asserting control as “the person to which the document was most recently transferred”
All the requirements of § 7-106 are fulfilled by using blockchain transactions. The electronic document, adigital warehouse receipt, is represented as tokens issued on, and transacted over, a blockchain.
Multiple paragraphs and sections of the UCC help LD2 further frame these digital warehouse receipts:
UCC § 7-104, Documents of Title. All LD2 tokens issued are negotiable, as stated in § 7-104(a), and (c), by specifying that one troy ounce of .999 fine silver is on deposit at the warehouse ([DEPOSITORY]) and is to be delivered to the bearer (i.e. token holder) on demand.
UCC § 7-105, Reissuance in Alternative Medium, explains that both physical and electronic documents of title can be interchanged through reissuance. These digital documents are every bit as valid as physical ones, provided their substitution is appropriately executed.
UCC § 7-202, Form of Warehouse Receipt, underscores that the warehouse receipt must specify the following: 1) the location of the warehouse facility, 2) the date of issue of the receipt, 3) the unique identification code of the receipt, 4) a statement whether the goods are delivered to the bearer, named person, or its order, 5) the rate of the storage and handling charges, 6) a description of the goods being stored, 7) the signature of the warehouse or its agent.
Note: All of the above informations/details can be found at the top of this page.
1 Alliance Laundry Systems v. Thyssenkrupp Materials, 2008 U.S. Dist. LEXIS 58985 (E.D. Wisc. Aug. 5, 2008)