How crypto and blockchain are disrupting lawyers and the legal sector

Industry

Think about what distributed ledger technology can provide – hard-to-hack data records, verifiable transaction histories and a mechanism for automated contracts – and it’s easy to see how it could be hugely disruptive for the work lawyers do.

Lawyers must wade through large volumes of established case law, ensure contracts are properly written and provide supporting documentation for the arguments they make. Whether they’re helping a client close a property sale, defending someone against criminal charges or representing a business owner in a legal dispute with another company, lawyers’ jobs revolve around verifying legal precedents, past events, agreements and transactions over time.

These are all things blockchains can help with.

For many people familiar with blockchain technology, the first thing they might think of when considering impacts on the legal sector is smart contracts… that is, “self-executing contracts with the terms of the agreement between buyer and seller being directly written into lines of code”. But distributed ledger tech could enable far wider-reaching changes in the practice of law.

Consider corporate law, for instance.

“Think about what a corporation is—on some level, a corporation is its records,” lawyer John Mark Zeberkiewicz told Fortune in 2017. “Ultimately, just about every corporate document and transaction could be recorded on the blockchain, creating an immutable record of all corporate acts.”

Or think about the criminal justice system.

“A dependence on paper-based working continues to result in unnecessary duplication and increased margins of error while manual processes such as the use of hard-copy discs contribute to higher volumes of lost evidence,” noted a 2017 report from The Police Foundation. “Offenders, whose records may be misplaced or out of date when they are transferred between institutions, are also affected. Poor file management can have significant implications for both ensuring rehabilitative interventions are appropriately targeted, and in the most serious of cases, that accurate custodial release dates are adhered to and thus human rights observed.”
Intellectual property law could also benefit from blockchain.

“A bulk of intellectual property (IP) filings have to undergo a manual review which is a long-tail and time-consuming process,” the blockchain application design firm LeewayHertz pointed out. “It is not only difficult to register new IP, but also to transfer ownership and update filings.”

The company added: “Due to the lengthy approval process, it becomes challenging to examine who created the IP first. Blockchain can bring disruption to the handling of patents and trademarks by reducing approval wait times and required resources.”
Blockchain could also make it easier to handle collections, set up escrow accounts, verify land registries and provide notary services… minus the notary public.

“Once real services are put into blockchain, the role of a lawyer to do due diligence about the good or services, to check what can be offered under a contract, prepare the terms and present them to a purchaser is negated entirely,” Joanne Frears, a solicitor at Lionshead Law, said in this article about legal innovation. With the added help of artificial intelligence, she continued, blockchain could render some practice areas obsolete, including banking law, financial services law, litigation support and paralegals.

At the same time, however, the rise of blockchain will also create new areas in which to practice law, as well as new opportunities for law-related businesses. For example, the startup Legal Nodes aims to “decentralise the provision of legal services and create the first distributed ‘law firm’”.

“We believe that fully automated legal services are the future of the legal industry,” the startup’s co-founders, Nestor Dubnevych and Margarita Sivakova, said in Forbes. “When the market will be ready, our platform would be able to transform into a fully autonomous legal services provider.”

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