Key points
- The terms of service of a Web3 dApp must address the legal, technical and operational issues specific to blockchain and smart contracts.
- The publisher must clearly identify its company or its identity, even with decentralised governance, to ensure transparency about the entity responsible.
- The terms of service describe how the technology works and inform users of the risks of losses, technical errors or security flaws beyond the publisher’s control.
- Access via a wallet address means specifying the technical prerequisites, the collection of personal data and the consequences of losing a wallet.
- A dedicated section defines intellectual property in the open-source code, the interfaces, user content and the outputs of smart contracts.
- Using a Web3 lawyer helps ensure that the project’s terms of service are compliant.
Drafting terms of service (CGU) suited to a Web3 decentralised application (dApp) requires you to address new legal, technical and operational issues. The use of blockchain technologies raises specific features that set these digital services apart from traditional platforms. To meet legal compliance requirements, the publisher must frame the use of the dApp, define the users’ roles and anticipate its legal obligations. This process protects not only users but also the publisher against the technical and legal risks linked to decentralisation and automation.
What are the fundamentals of dApp terms of service?
Terms of use remain essential for any digital platform. In the context of decentralised applications, they must highlight the mandatory information specific to the Web3 sector and incorporate specific models such as smart contracts. Publishers rely on national and European legal frameworks while adapting their offering to the autonomous nature of dApps.
The French Law on Confidence in the Digital Economy (LCEN) requires the publisher of an online service to make available to the public its identity or, for a legal entity, its company name, registered office, telephone number and registration (Article 1-1 of Law No. 2004-575 of 21 June 2004 (in French)), even if the solution relies on decentralised or pseudonymous governance. User protection therefore requires transparency about the entity responsible for managing and providing technical support for the dApp. Where this information is missing, its absence could raise legal liability issues.
What specific points should Web3 dApp terms of service cover?
Each decentralised application model has technical features that require the structure of the terms of service to be adjusted. Protecting the relationship between the user and the dApp involves a precise description of how the underlying technology works, the validation methods on the blockchain or the smart contracts involved. This structure provides clear information to users about the potential risks. Using a Web3 lawyer (in French) gives you support in ensuring that your project’s terms of service are compliant.
Some use cases involve direct interaction with tokens, NFTs or automated financial protocols. In this context, legal compliance requires an explicit statement that losses, technical errors or security flaws beyond the publisher’s control may occur. Liability must be clearly delimited so that users understand their rights and limits in an open and sometimes irreversible environment. Where the user is a consumer, however, a clause that removes or reduces their right to compensation if the publisher fails to perform its obligations is irrebuttably presumed to be unfair (Article R. 212-1, 6° of the French Consumer Code (Code de la consommation) (in French)).
How should access and sign-up arrangements be handled?
Accessing a dApp differs significantly from accessing a traditional web platform. Generally, the user accesses the service via a wallet address without conventional authentication. The publisher sets out in the terms of use the exact steps for connecting a wallet and clarifies the extent of the personal data collected.
The security of dApps often depends on the level of wallet integration, the compatible browsers and the robustness of the source code. Users should therefore be informed of the technical prerequisites, of whether the smart contracts are open to public audit, and of the consequences of withdrawing or losing access to a wallet. Setting this out in writing helps avoid incurring disproportionate liability where the user acts carelessly.
How should intellectual property and reuse be addressed?
A specific section of the terms of service describes the policy adopted on intellectual property in the elements accessible via the dApp: open-source code, graphical interfaces, user-generated content or outputs of smart contracts. This provision is essential to guide users on whether they may lawfully use, reproduce or distribute the various components of the application.
If the dApp offers features based on the creation or transfer of NFTs, the terms of use specify how the transfer, assignment or related licence of use operates. The publisher thus defines appropriate protection, both for itself and for third-party contributors, while taking care to respect the principle of censorship resistance inherent in certain blockchains.
Which specific legal obligations must be covered for the terms of service to be compliant?
The use of decentralised applications entails additional regulatory compliance obligations. Depending on the jurisdiction and the use cases, compliance with European texts – such as Regulation (EU) 2023/1114, known as “MiCA”, for crypto-assets, or anti-money laundering rules – adds a further level of requirements to the drafting of the terms of service. These legal obligations apply in particular where a dApp facilitates the storage, purchase or exchange of tokens with real economic value.
The text then contains warnings about the risks of fluctuation, the volatility of digital assets and the losses inherent in operating on public networks. Where the publisher provides crypto-asset services, it must be authorised as a crypto-asset service provider (CASP) (Article 59 of the MiCA Regulation); it must then provide its clients with fair, clear and not misleading information, warn them of the risks (Article 66) and publish its complaints-handling procedure (Article 71). These elements frame the security of dApps in light of the obligations to report to or cooperate with third-party authorities.
How should incident and security management be handled on a dApp?
The terms of service set out the protocol to follow in the event of a security breach, a bug in the smart contracts or a critical update. They explain any role of the publisher or the community in resolving major incidents. Anticipating these situations limits the legal impact of an uncontrolled malfunction inherent in the automation specific to blockchain.
Prevention is also a central point of the terms of use. It involves reminding users that using a dApp exposes them to external risks such as phishing, scams or network outages. Through this statement, the publisher confirms its diligence while making sure that part of the duty of vigilance rests with the end user for each transaction.
Do consent and changes to the terms of service work differently for a dApp?
Drafting the terms of service involves setting out the accepted methods for obtaining users’ consent, often directly through the interface on first connection. Given the decentralised and immutable nature of certain components, later changes to the terms are organised by providing for actual notification or a message displayed on the dApp itself. Where the user is a consumer, a clause reserving to the publisher the right to unilaterally change the duration, features or price of the service is irrebuttably presumed to be unfair (Article R. 212-1, 3° of the Consumer Code).
The publisher takes care to keep an archived, accessible version of the previous terms, which strengthens legal certainty in the event of a dispute. Transparent publication of changes, combined with a functional “opt-in” approach, contributes to the overall legal protection of the dApp and its community ecosystem.
For assistance: crypto-asset lawyer.
