Theft and the evolution of digital assets in Maltese law

Abstract

‘facta lex inventa fraus’: The human being always strives to circumvent and exploit legisla8on enacted. This dissertation articulates and further develops this maxim in light of the emergence of cryptocurrencies and other digital assets, which have challenged the established definition of theft applied by the Maltese Courts. This matter is of particular controversy since the judicial definition, based on the formula8on of Francesco Carrara, is limited to the dispossession of a movable, tangible object, belonging to another, accompanied by the fraudulent intent and the intent to make a gain. The difficulty arises since digital assets do not exist in a corporeal nature. This study comments on the provision’s text, or lack of, the jurisprudential interpretation, and other offences that were necessary to resort to owing to the incapability of the offence of theft, in light of incorporeal, intangible assets. Chapter 1 analyses all the applicable definitions, entering into the five essential elements of Carrara’s definition of theft, alongside expanding on digital assets and the operations of blockchain. Attention is then drawn to the offence of computer misuse, owing to its current applicability with regards to technological advancement. An evaluation of the capacity of the Maltese legislation to deal with the dispossession of digital assets is devised in chapter 2, unveiling issues with the judicial definition of theft, and entering into the auspice of the maxim, ‘nullum crimen sine lege’. The complexities of the reliance on computer misuse are articulated in such a chapter, supported by analysing the offence’s raison d’être, and scope of application. A critique is conducted in chapter 2.4 between crypto theft and crypto fraud. The chapter synthesises these doctrinal tensions and identifies the structural inadequacies that arise when traditional property offences confront modern digital realities. This dissertation also presents a transnational comparative analysis within chapter 3, which aims to iden8fy legislative amendments and mechanisms that Malta could consider adopting, in order to strengthen its own regulatory framework. Chapter 4 builds on the above and concludes by communicating the inadequacy of the current law, and presents academically constructed recommendations for legislators to act.