Smart Contract in the Metaverse: A Comparative Legal Analysis of Nigeria and Uganda in the Age of Digital Transaction

Paul Atagamen Aidonojie, Adesoji Kolawole Adebayo, Obieshi Eregbuonye, Kelechi Jude Onwubiko, Joshua John Damina

Abstract


The emergence of the Metaverse as a decentralized digital ecosystem has transformed traditional contract enforcement by introducing smart contracts, self-executing agreements embedded in blockchain systems. This study conducts a comparative legal analysis of the regulatory frameworks governing smart contracts within Metaverse operations in Nigeria and Uganda. Employing a doctrinal legal method, the research critically examines primary legal sources such as statutory laws and case law, alongside scholarly literature, to assess legal recognition, enforceability, and institutional preparedness. The study reveals a significant regulatory gap in Nigeria, where the absence of a comprehensive legal framework creates uncertainty in the enforceability of smart contracts, despite growing blockchain policy initiatives. In contrast, Uganda has established more definitive legal provisions, particularly through its Electronic Transactions and Signature Acts, which explicitly validate digital contracts. The novelty of this study lies in its regional comparative focus on emerging economies and its analysis of how traditional contract principles interact with decentralized digital platforms. The urgency of this inquiry is underscored by the rapid digitalization of commerce, which necessitates timely legal adaptation to prevent regulatory obsolescence and safeguard stakeholders. This research contributes to the discourse on digital governance by proposing a legal reform agenda for Nigeria, advocating for the adoption of a smart contract-enabling framework modeled after Uganda’s approach. Ultimately, it calls for regional and international harmonization to ensure legal certainty, consumer protection, and dispute resolution within Metaverse-driven economies.


Keywords


Smart-Contracts; Legal; Metaverse; Nigeria; Ugandan.

Full Text:

PDF

References


Abdelkader Mohamed Sghaier Derbali, Blockchain Applications for Smart Contract Technologies (Hershey, PA: IGI Global, 2024).

Abir El Azzaoui and JaeSoo Kim, “QNFT: A Post-Quantum Non-Fungible Tokens for Secure Metaverse Environment,” Journal of Information Processing Systems 20, no. 2 (2024): 273–283.

Aboye P. Cosmos and Rick Ezejiofor, “The Impact of E-Taxation on Revenue Generation in Enugu, Nigeria,” International Journal of Advanced Research 2, no. 2 (2024): 449–458.

Adaolu T. Obafemi, Ayoola T. John, and Akinkoye E. Yemi, “‘Electronic Payment System in Nigeria: Implementation, Constraints and Solutions,’” Journal of Management and Society 1, no. 2 (2011): 56–62.

Adaralegbe Babatunde, “E-Business and Matters Arising from Some Commercial Law Perspective,” accessed April 24, 2024, https://www.babalakinandco.com/.../e-business.

Adegite E. Odetukun, Business Law for Accounting Technicians Scheme West Africa (ATSWA), ed. ABWA Publishers (Abuja, Nigeria: 2009);

Adejoh V. Adetunde, “Role of E-Commerce in the Economic Development of Nigeria (Konga a Case Study),” Texila International Journal of Management 4, no. 1 (2018): 1–5.

Adeniyi S. Ismail and Babalola Adesunloro, “Electronic Taxation and Tax Evasion in Nigeria: A Study of Lagos State,” Journal of Academic Research in Economics 9, no. 1 (2017): 45–59

Adriyoosu D. Adebayo, An Examination of the Legal Regulations and Taxation of Telecommunications and Electronic Commerce in Nigeria (Ph.D. thesis, University of Ilorin, Nigeria, 2012), 1–345.

Advertising Regulatory Council of Nigeria Act, 2022.

Ahmad Musamih et al., “Enhancing Claustrophobia Exposure Therapy: A Blockchain and NFT-Enabled Metaverse Approach,” Computers in Human Behavior 160 (2024): 108364.

Ahmad Tarmizan Kusuma and Suhono Harso Supangkat, “Metaverse Fundamental Technologies for Smart City: A Literature Review,” in Proceedings of the 2022 International Conference on ICT for Smart Society (ICISS) (2022): 1–7.

Ahmad Zainudin et al., “Blockchain-Inspired Collaborative Cyber-Attacks Detection for Securing Metaverse,” IEEE Internet of Things Journal 11, no. 10 (2024): 18221–18236.

Aidonojie Paul Atagamen and Odojor Oyemwen, “Impact and Relevance of Modern Technological Legal Education Facilities Amidst the Covid-19 Pandemic: A Case Study of Law Students of Edo University Iyamho,” KIU Journal of Humanities 5, no. 4 (2020): 7–17;

Aidonojie Paul Atagamen, “Challenges Concerning the Legal Framework of an Automated Personal Income Tax in Edo State, Nigeria,” Jurnal Hukum Replik 12, no. 1 (2024): 83–115, http://dx.doi.org/10.31000/jhr.v12i1.7717

Aidonojie Paul Atagamen, A. Oyemwen Odojor, O. Oluwaseye Ikubanni, A. Adeniyi Oyebade, Adeniyi Oyedeji, and Nosa Okuoghae, “The Challenges and Impact of Technological Advancement to the Legal Profession in Nigeria Given the Covid-19 Pandemic,” KIU Journal of Humanities 6, no. 4 (2022): 5–19.

Aidonojie Paul Atagamen, Adebayo K. Adesoji, Eregbuonye Obieshi, and Wakili Saminu Abacha, “Breaking Legal and Socio-economic Challenges to Plastic Waste Regulation in Nigeria: Lessons Learned from Singapore,” Yustisia 13, no. 1 (2024): 64–88, https://doi.org/10.25041/aelr.v5i1.3230

Aidonojie Paul Atagamen, Adesoji K. Adesoji, Eregbuonye Obieshi, Antai Godswill, Owoche Ogbemudia Ottah, and Muhammad Mutawalli, “The Prospect, Legal, and Socio-economic Implication of Metaverse Operation in Nigeria,” YURISDIKSI 19, no. 4 (2024): 455, https://doi.org/10.55173/yurisdiksi.v19i4.201.

Aidonojie Paul Atagamen, Eregbuonye O., Majekodunmi T. Afolabi, and Inagbor Micheal, “The Prospect and Legal Issues of Income Tax in the Nigerian Metaverse,” Trunojoyo Law Review (TLR) 6, no. 1 (2024): 17–50, https://doi.org/10.21107/tlr.v6i1.23874.

Aidonojie Paul Atagamen, Eregbuonye Obieshi, Inagbor Micheal, and Ogbemudia Ottah, “Legal and Socioeconomic Issues Concerning the Nigeria Higher Institution Loan Act 2023,” Jurnal Legalitas 17, no. 1 (2024): 1–23, https://doi.org/10.33756/jelta.v17i1.23143

Aidonojie Paul Atagamen, Ikubanni O. Oluwaseye, and Okoughae Nosa, “The Prospect, Challenges and Legal Issues of Digital Banking in Nigeria,” Cogito Multidisciplinary Journal 14, no. 2 (2022): 186–209.

Aidonojie Paul Atagamen, Joseph Nwazi, and Ugiomo Eruteya, “The Legality, Prospect, and Challenges of Adopting Automated Personal Income Tax by States in Nigeria: A Facile Study of Edo State,” Cogito Multidisciplinary Journal 14, no. 2 (2022): 149–170.

Aidonojie Paul Atagamen, Majekodunmi T. Afolabi, and O. Janet Adeyemi-Balogun, “The Legal Issues Concerning the Operation of Fin-Tech in Nigeria,” Jurnal Media Hukum 30, no. 2 (2023): 78–79.

Aidonojie Paul Atagamen, Majekodunmi Toyin Afolabi, Eregbuonye Obieshi, and Adeyemi-Balogun Omolola Janet, “Potential and Legal Challenges of Metaverse for Environmental Awareness and Sustainable Practice in Nigeria: A Comparative Study with Singapore,” Administrative and Environmental Law Review 5, no. 1 (2024): 37–64, https://doi.org/10.25041/aelr.v5i1.3230.

Aidonojie Paul Atagamen, Nwazi Joseph, and Ugiomo Eruteya, “Illegality of Income Tax Evasion in Edo State: Adopting an Automated Income Tax System as a Panacea,” Jurnal Legalitas 16, no. 1 (2023): 56–86.

Aidonojie Paul Atagamen, O. Oluwaseye Ikubanni, Nosa Okoughae, and Adeniyi Ayoedeji, “The Challenges and Relevance of Technology in Administration of Justice and Human Security in Nigeria: Amidst the Covid-19 Pandemic,” Cogito Multidisciplinary Journal 13, no. 3 (2021): 149–170.

Aidonojie Paul Atagamen, Odojor A. Oyemwen, and Oladele O. Odetokun, “An Empirical Study of the Relevance and Legal Challenges of an E-Contract of Agreement in Nigeria,” Cogito Multidisciplinary Research Journal 12, no. 3 (2020): 181.

Aidonojie Paul Atagamen, Odojor A. Oyemwen, O. Oluwaseye Ikubanni, A. Adeniyi Oyebade, Adeniyi Oyedeji, and Nosa Okuoghae, “The Challenges and Impact of Technological Advancement to the Legal Profession in Nigeria Given the Covid-19 Pandemic,” KIU Journal of Humanities 6, no. 4 (2020): 5–19.

Aidonojie Paul Atagamen, Wakili Saminu Abacha, and Ayuba David, “Effectiveness of the Administration of Justice in Nigeria under the Development of Digital Technologies,” Journal of Digital Technologies and Law 1, no. 4 (2023): 1105–1131, https://doi.org/10.21202/jdtl.2023.48

Andrew Ebekozien, “Smart Contract Applications in the Built Environment: How Prepared Are Nigerian Construction Stakeholders?” Frontiers of Engineering Management 11 (2024): 50–61

André Janssen, “Contract Law in the Metaverse,” in Research Handbook on the Metaverse and Law, (2024): 279–291.

Angela Maria Vargas Ariza, Marleny Corzo Marín, and Mayeth Lizeth Duran Duran, “The Metaverse: Financial Assurance Procedures in Smart Contracts and NFTs,” International Journal of Religion 5, no. 11 (2024): 223–232.

Ankur Gupta, Surbhi Gupta, and Saurabh Sharma, “A Digital Twin Framework for Smart Contract-Based DeFi Applications in the Metaverse: Towards Interoperability, Service Scaleup & Resilience,” Next Generation Computing and Information Systems (2024): 88–94.

Azza Mohamed and Rouhi Faisal, “Exploring Metaverse-Enabled Innovation in Banking: Leveraging NFTs, Blockchain, and Smart Contracts for Transformative Business Opportunities,” International Journal of Data & Network Science 8, no. 1 (2024).

C. Kuppuswamy et al., A Blockchain for Nigeria – Exploring Blockchain Policy and Adoption in Nigeria (Hatfield: University of Hertfordshire, 2023), 1–61.

Catherine Elliott and Frances Quinn, Contract Law, 8th ed. (England: Pearson Education Limited, 2011)

Cheshire and Fifoot’s Law of Contract, 10th ed. (England: Butterworth & Co. Publishers Ltd., 1981).

Contract Act, 2010.

Cybercrimes (Prohibition and Prevention) Act (CPPA), 2015.

Electronic Signature Act, no. 7 of 2011.

Electronic Transaction Act, no. 8 of 2011.

Financial Act, 2021.

Francesco Cannas and Rossella Spada, “The VAT Treatment of Crypto Art: Between NFTs, Smart Contracts and the Metaverse: How a Bundle of New Concepts Can Fit into the Existing Categories,” Intertax 52, no. 1 (2024).

Funmilola Olatundun Olatoye et al., “Blockchain in Asset Management: An Extensive Review of Opportunities and Challenges,” International Journal of Science and Research 11 (2024): 2111–2121.

Grace Osariemen Eghe-Ikhurhe, “The Relevance of Blockchain-Based Voting Adoption in Governance Structure: Evidence from Nigeria,” International Journal of Economics, Commerce and Management 11, no. 2 (2023): 1–21

Hongzhou Chen et al., “Web3 Metaverse: State-of-the-Art and Vision,” ACM Transactions on Multimedia Computing, Communications and Applications 20, no. 4 (2023): 1–42.

Hung Duy Le, Vu Tuan Truong, and Long Bao Le, “Blockchain-Empowered Metaverse: Decentralized Crowdsourcing and Marketplace for Trading Machine Learning Data and Models,” IEEE Access (2024).

Ibrar Yaqoob et al., “Metaverse Applications in Smart Cities: Enabling Technologies, Opportunities, Challenges, and Future Directions,” Internet of Things 23 (2023): 100884.

Ikubanni O. Oluwaseye and Aidonojie Paul Atagamen, “The Legality of Virtual Marriage in Nigeria Given the Covid-19 Pandemic Social Distancing: An X-Ray of the Matrimonial Causes Act,” Madonna University, Nigeria Faculty of Law, Law Journal 6, no. 1 (2021): 123–129.

J. Edem Adoh, “Taxing the Informal Economy in Nigeria: Issues, Challenges and Opportunities,” International Journal of Business and Social Science 6, no. 10 (2015): 53.

Jane P. Mallor et al., Business Law and the Regulatory Environment, 11th ed. (Boston: Irwin/McGraw-Hill, 2001); Richard Stone, Principles of Contract Law, 3rd ed. (London: Cavendish Publishing Limited, 1997).

Jihyeon Oh et al., “A Secure Content Trading for Cross-Platform in the Metaverse with Blockchain and Searchable Encryption,” IEEE Access 11 (2023): 120680–120693.

Kaya Kuru and Kaan Kuru, “UMetaBE-DPPML: Urban Metaverse & Blockchain-Enabled Decentralised Privacy-Preserving Machine Learning Verification and Authentication with Metaverse Immersive Devices,” Internet of Things and Cyber-Physical Systems 5, no. 1 (2025).

Keke Gai et al., “Blockchain-Based Multisignature Lock for UAC in Metaverse,” IEEE Transactions on Computational Social Systems 10, no. 5 (2022): 2201–2213.

Laurence Koffman and Elizabeth MacDonald, The Law of Contract, 7th ed. (New York: Oxford University Press, 2010).

Longbing Cao, “Decentralized AI: Edge Intelligence and Smart Blockchain, Metaverse, Web3, and DeSci,” IEEE Intelligent Systems 37, no. 3 (2022): 6–19.

Mohtasin Golam et al., “Meta-Learning: A Digital Learning Management Framework Using Blockchain for Metaverses,” IEEE Access (2024).

Muhammad Adnan, “Smart Grid 3.0: Navigating the Future—Unleashing the Power of Metaverse, Blockchain, and Digital Twins in the Evolution of Smart Grids,” Blockchain, and Digital Twins in the Evolution of Smart Grids, January 20, 2024

National Blockchain Policy For Nigeria, 2023

National Information Technology Development Agency Act (NITDA), 2007.

Nigerian Communications Commission Act, 2003.

Nigerian Data Protection Regulation Act, 2023.

Nigerian Startup Act, 2022.

Ouns Bouachir et al., “AI-Based Blockchain for the Metaverse: Approaches and Challenges,” in Proceedings of the 2022 Fourth International Conference on Blockchain Computing and Applications (BCCA) (2022): 231–236.

Paul P. Momtaz, “Some Very Simple Economics of Web3 and the Metaverse,” FinTech 1, no. 3 (2022): 225–234.

Pronaya Bhattacharya et al., “Towards Future Internet: The Metaverse Perspective for Diverse Industrial Applications,” Mathematics 11, no. 4 (2023): 941.

Renaka Agusta, “Marketplace NFT untuk Metaverse Berbasis Smart Contract Blockchain Ethereum” (Master’s thesis, Institut Teknologi Sepuluh Nopember, 2023).

Rick Duxbury, Contract Law, 8th ed. (London: Sweet & Maxwell, 2009)

Sam Gilbert, “Crypto, Web3, and the Metaverse,” Bennett Institute for Public Policy, Cambridge, Policy Brief, 2022.

Shen Su et al., “Detecting Smart Contract Project Anomalies in Metaverse,” in Proceedings of the 2023 IEEE International Conference on Metaverse Computing, Networking and Applications (MetaCom) (2023): 524–532.

T. Afolabi Majekodunmi, Oluwaseun Janet, Aidonojie Paul Atagamen, O. Oluwaseye Ikubanni, and Oyebade A. Adeniyi, “Legal Issues in Combating the Scourge of Terrorism; Its Impact on International Trade and Investment: Nigeria as a Case Study,” KIU Journal of Humanities 7, no. 3 (2022): 129–139.

Tae-Gyu Lee, “A Test Method for the Convergence of the Metaverse and Blockchain,” in Proceedings of the 2024 26th International Conference on Advanced Communications Technology (ICACT), 321–326, 2024.

Tega Edema, Contract Law in an Era of Technology: Examining Liability in Smart Contract Transactions, ABUAD Law Journal 8, no. 1 (2020): 74–93.

The Money Laundering (Prohibition) Act, 2022

Vinden Wylde et al., “Post-COVID-19 Metaverse Cybersecurity and Data Privacy: Present and Future Challenges,” in Data Protection in a Post-Pandemic Society: Laws, Regulations, Best Practices and Recent Solutions, 1–48, 2023.

Wieland Müller et al., “Metaverse, Ubi Es? A Transaction Cost-Based Analysis of the State of the Art of Smart Contracts in the Metaverse,” in Proceedings of the 57th Hawaii International Conference on System Sciences (HICSS) (2024): 5038–5047.

Winston Ma and Ken Huang, Blockchain and Web3: Building the Cryptocurrency, Privacy, and Security Foundations of the Metaverse (Hoboken, NJ: John Wiley & Sons, 2022).

Xiaorui Zhang, “Blockchain Technology-Based Metaverse Development Application,” in Proceedings of the 2023 IEEE 6th Information Technology, Networking, Electronic and Automation Control Conference (ITNEC), vol. 6, 1521–1524, 2023.

Yijing Lin et al., “Blockchain-Based Efficient and Trustworthy AIGC Services in Metaverse,” IEEE Transactions on Services Computing, 2024.

Yongjun Ren et al., “HCNCT: A Cross-Chain Interaction Scheme for the Blockchain-Based Metaverse,” ACM Transactions on Multimedia Computing, Communications and Applications 20, no. 7 (2024): 1–23.

Yuchuan Fu et al., “A Survey of Blockchain and Intelligent Networking for the Metaverse,” IEEE Internet of Things Journal 10, no. 4 (2022): 3587–3610.

Yuntao Wang, Zhou Su, and Miao Yan, “Social Metaverse: Challenges and Solutions,” IEEE Internet of Things Magazine 6, no. 3 (2023): 144–150.




DOI: https://doi.org/10.33756/jelta.v18i1.28584

Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.