Regulating Emerging Technologies: Prospective Sensemaking through Abstraction and Elaboration

Emerging digital technologies require regulation that will avoid harmful effects but that also, ideally, fosters innovation. We report on a case study of how actors, representing a variety of perspectives (legal, regulatory authority, government, industry, and technology), interacted to construct a law on trustworthy technology in the European state of Liechtenstein. This regulatory construction was enabled by collective prospective sensemaking relying on the interrelated processes of abstraction and elaboration, through which actors collectively reconceptualized the regulatory target in terms of the technology (from blockchain to trustworthy technology), its uses (from cryptocurrency to token economy), and required roles (from financial service provider roles to trustworthy technology systems roles). Abstraction allowed the group of actors to extract and generalize essential properties to support the regulatory goals of technology neutrality and innovation-friendliness. Elaboration allowed the group to identify and specify details and requirements to support the regulatory goals of creating legal certainty and protecting users. Through these processes, actors could construct a shared, collective understanding that accommodated various viewpoints and paved the way for writing a law. From this case study, we develop a theory of collective prospective sensemaking in regulating emerging technologies.