Blockchain in the Law
A blockchain is a time-stamped series of data maintained by a computer network that isn’t owned by a single person or institution. Each of these blocks is secured and interconnected using cryptographic principles. Blockchain has no singular authority. Thus, all information is transparent. Also, all parties are held accountable for their actions.
In layman’s terms, blockchain enables companies to make transactions without the bureaucracy of traditional systems. To secure these transactions, the technology uses cryptography. Thus, anything that built on the technology is transparent. It offers agile transactions, a layer of accountability and a distinct method of fostering trust with clients.
Intersection: Blockchain and Legal Industry
Blockchain can record information on a continuously updated register. Due to blockchain’s transparency, the decentralized network offers client-facing lawyers who deal with sensitive information a crucial asset. With law firms capitalizing on the low barrier of entry, expect easier onboarding of digitized assets and improved flexibility.
in contrast, blockchain differs drastically from a traditional spreadsheet. In fact, as mentioned earlier, no single entity manages the system. The distributed ledger is shared across the network, known as nodes, with each involved party having access to the ledger. Whenever you generate a new block, you add it to the previous one. When visualized, it resembles a chain of blocks.
Blockchain In The Law: Unique Benefits
Below are a few of its biggest selling points in the legal industry:
Accommodates all clients
As technologically savvy generations become older and require the counsel of lawyers, they will bring a unique commodity that uninitiated lawyers might have a difficult time understanding and quantifying — and that’s the concept of the digital asset. Lawyers need to be cognizant of how browsers and social media sites collect information. Blockchain technology, for example, can be an asset for handling these types of assets. With the aid of blockchain, lawyers will understand how valuable the distribution and monitoring of consumer information is.
Smart contracts represent a negotiation between parties with the terms translated into parsed computer codes with different types of conditions. With the code embedded into a decentralized system for easy monitoring, this pushes the legal profession into the 21st century. These contracts are autonomous, auto-sufficient, and an asset for lawyers.
There has been fear-mongering of the smart contract essentially replacing the role of a lawyer. That line of thinking represents an ounce of truth in a pound of fiction: smart contracts can minimize the role that lawyers might hold in registering and transferring assets, but they cannot limit the unique position that lawyers have of translating complex negotiated terms into codes. The gray area between technical computer codes and legal prose drafted by lawyers is rather large.
Reduces system complexity and bureaucracy
Blockchain-enabled platforms allow easy sharing and coordination of documents in a distributed ledger, making paperwork largely obsolete. The technology empowers lawyers to update and authenticate data to make counseling decisions. It also helps in the accurate dissemination of information between clients, mediators and paralegal specialists.
The work that lawyers do can be thankless. This is especially true with the onslaught of stereotypes that paint lawyers as detached and dishonest characters. With the help of blockchain, expect to see more efficient record-keeping. The public has greater access to these records and information, offering a lawyer of transparency during all legal processes. The blockchain provides proof of document notarizations and ensures all data points are independently verifiable.
Contact Austin LRS Lawyers
Lawyer Referral Service of Central Texas connects tentative clients with lawyers who are utilizing blockchain technology to ensure accuracy and transparency of client-lawyer information. To get in contact with a blockchain-friendly lawyer, contact us.