Blockchain, Digital Identity, and Tokenization Law: Shaping the Law of the Future with Genesis
In the twenty-first century, where digitalization is rewriting all the rules for individuals, corporations, and states, identity and asset management is undergoing a profound revolution. Blockchain technology, which emerged as a response to the serious vulnerabilities of traditional centralized systems—such as data breaches, erosion of privacy, and lack of user control—is redrawing the boundaries of law with concepts like Self-Sovereign Identity (SSI) and tokenization.
This transformation is not merely a technical innovation but a philosophical revolution that fundamentally reshapes the individual’s existence in the digital world. At Genesis Law, we are building the legal infrastructure for this technological revolution, ensuring that our clients can confidently exist in this new digital economy in full compliance with the law.
Through the blockchain legal consultancy we provide, we not only help you comply with current regulations but also prepare you for future frameworks, such as the blockchain-based digital identity vision announced by the Presidential Digital Transformation Office for the Turkish e-Government platform.
Why This Field Requires Legal Expertise
Blockchain-based systems present structures that directly conflict with existing legal paradigms while also offering enormous opportunities. Operating in this field requires not only an understanding of the technology but also a deep analysis of its legal implications.
Self-Sovereign Identity (SSI) and Decentralized Identifiers (DIDs)
This model, which grants individuals full control over their identities, is based on Christopher Allen’s fundamental principles (existence, control, access, transparency, etc.). This philosophy calls into question the classical “data controller” definition in Turkish data protection law (KVKK).
In a structure where trust derives not from BTK-approved centralized institutions but from the cryptographic proof that a digital signature on a VC mathematically matches a public key on the blockchain, how can this coexist with the hierarchical trust model of Law No. 5070 on Electronic Signatures? Even the choice of different DID methods—such as did:ion, which is ideal for high-security, state-based identities—has significant legal consequences.
Verifiable Credentials (VCs) and Zero-Knowledge Proofs (ZKPs)
VCs, which are digital and cryptographically secure versions of documents such as diplomas and driver’s licenses, operate within a “Trust Triangle” (Issuer-Holder-Verifier). The most revolutionary aspect of this model is that a Verifier does not need to establish real-time communication with the Issuer to validate the information. When combined with Zero-Knowledge Proofs (ZKPs), VCs perfect the principle of "data minimization."
Zero-Knowledge (ZK) Technology for Finance
Read our services for ZK Technology for Finance consultancy for more information
For instance, selective disclosure mechanisms that allow a user to prove they are over 18 without revealing their date of birth or age open a new chapter in privacy law. The acceptance of such cryptographic proofs as “initial evidence” under the Turkish Code of Civil Procedure (HMK) could fundamentally transform dispute resolution processes.
Tokenization of Identity (NFTs, SBTs, ERC-6551)
Turning identity information, rights, and reputation into “tokens” on the blockchain raises legal questions ranging from property law to capital markets legislation. Reputation systems built with non-transferable Soulbound Tokens (SBTs) provide benefits in areas such as DAO governance but also pose risks, such as social scoring or reputational harm by malicious SBTs sent by authoritarian regimes.
The ERC-6551 standard, which allows an NFT to own its own wallet (Token Bound Account) and hold other digital assets, creates “gray zones” requiring Capital Markets Board (SPK) analysis by enabling an identity-based asset to evolve into a financial portfolio over time.
Our Services – Blockchain-Based Digital Identity and Tokenization Consultancy
At Genesis Law, we build the legal architectures of blockchain-powered digital identity systems, self-sovereign identity (SSI) frameworks, decentralized identifiers (DIDs), verifiable credentials (VCs), and token-based digital asset systems (NFTs, SBTs, ERC-6551). We deliver technically aligned legal solutions under KVKK (Turkish Personal Data Protection Law), Law No. 5070, the Code of Civil Procedure (HMK), and Capital Markets Law (SPK), enabling both public and private sector institutions to adapt to this transformation.
Genesis Law provides strategic and results-oriented legal solutions at every stage of your blockchain-based digital identity and tokenization projects.
1. Blockchain and KVKK Compliance Consultancy
We manage the complexity of data protection law in this new ecosystem for you.
Determination of Data Responsibility and Joint Control Models:
We determine the legal status of the roles in the SSI ecosystem—Issuer, Holder, and Verifier—clearly outlining the scope of responsibility for each stakeholder, and designing joint data responsibility models that go beyond the classical “data controller/data processor” distinction defined in KVKK.
Legal Solutions for the “Right to Be Forgotten” vs. Immutability Dilemma:
We design legally compliant architectures that prevent conflict between the blockchain’s “immutability” and the “right to be forgotten” under Article 7 of KVKK. Sensitive personal data is never written to a public blockchain. Instead, only cryptographic proofs (hashes) indicating the existence of DIDs or VCs, and revocation list updates, are recorded. The actual data is encrypted and stored off-chain in environments such as the user's wallet. Through techniques like “cryptographic erasure” via key destruction, we develop legal arguments to recognize such technical methods as valid data deletion under KVKK.
Granular Consent and Disclosure Mechanisms:
We design SSI wallet-based systems that present the user with what data will be shared, with whom, and for what purpose, ensuring compliance with KVKK’s requirement for “informed and freely given consent for a specific subject.”
Global Data Transfer Strategies:
Given the borderless nature of blockchain networks, we develop legal strategies to address the risk of technical cross-border data transfers. These include adapting Binding Corporate Rules (BCRs) to decentralized systems or proposing new data transfer standards in line with KVKK Article 9.
2. Tokenization and Capital Markets (SPK) Law
We minimize legal risks while paving the way for innovation when tokenizing your assets or rights.
Legal Qualification Analysis of Tokens (Howey Test & SPK Criteria):
We analyze whether your project’s token (NFT, SBT, Utility Token) merely grants access rights or implies financial expectations like profit or interest, and determine whether it qualifies as a “capital market instrument” under Law No. 6362, taking preventive action against unauthorized public offerings.
Legal Structuring of NFT and ERC-6551 Projects:
From ownership proof scenarios such as driver’s licenses represented as NFTs to complex ERC-6551 structures where NFTs can store other securities tokens in their own wallet, we chart your legal roadmap across hybrid domains.
SBT Risk and Ethical Governance:
We address the legal framework of reputational risks, privacy breaches, and key loss associated with non-transferable SBTs by designing rejection mechanisms and “community recovery” protocols for users.
3. Smart Contracts, e-Government, and Evidence Law
We ensure your digital agreements and identity verifications are legally valid and admissible in court.
Validity and Enforceability of Smart Contracts:
We ensure the legal validity of smart contracts—where parties’ intent is recorded through private key-signed irreversible transactions—within the framework of the Turkish Code of Obligations' “freedom of form” principle. For cases requiring formalities (e.g., real estate sales), we develop legal solutions and legislative amendment proposals.
Use of VC and DID as Legal Evidence:
We prepare legal arguments for VCs to qualify as “documents” under Article 199 and “initial evidence” under Article 202 of the Code of Civil Procedure (HMK), allowing supplementary evidence like witness testimony even in cases where notarized documents are typically required.
Legal Support for e-Government Integration Projects:
We design the legal and technical framework for complementary models where public institutions (e.g., the Population Directorate, Council of Higher Education) act as trusted Issuers, and citizens use their VCs in the private sector or to access e-Government using wallet-based login mechanisms.
4. Cybercrime and Dispute Resolution
We protect you against the risks of the decentralized world.
Blockchain Forensics and Attribution:
In cases where blockchain transactions are conducted under pseudonyms, we provide legal support during investigations that rely on off-chain data such as IP tracking or KYC records from centralized crypto exchanges.
Fighting Identity Theft and Forgery under Turkish Penal Code (TCK):
We manage criminal proceedings for cases where private key theft constitutes “unauthorized access to information systems” (Art. 243) and data manipulation constitutes “tampering with data” (Art. 244). Creating fake diploma VCs may qualify as forgery under Articles 204 or 207 depending on the nature of the document.
Services In Summary:
Why Genesis Law?
Pioneering and Visionary Approach:
We do not view law as a set of rules that merely follow technology from behind, but as a strategic tool that enables innovation. The comprehensive reports and analyses we publish in this field are a testament to our deep expertise and forward-thinking perspective.
Deep Technical and Legal Integration:
Our team possesses advanced competence in analyzing the intersection between local legal frameworks—such as KVKK, SPK, the Turkish Penal Code (TCK), and the Code of Civil Procedure (HMK)—and highly technical topics like W3C standards, diverse DID methods (e.g., the offline and free did:key vs. the highly secure and censorship-resistant did:ion), and Zero-Knowledge Proofs (ZKPs).
Strategic Legal Partnership:
We don't just tell you what's legal or not—we co-design the most suitable, fully compliant, and innovative legal architectures tailored to your project’s goals. Our aim is to help you become a part of the next-generation infrastructure that will strengthen Turkey’s digital sovereignty.
