Blockchain Tech – The New Legal Eagle?
Blockchain technology is not one of the latest inventions, but it could very well be one of the most revolutionary. Most people have heard about it in its relation to Bitcoin, but cryptocurrency applications are a very small part of what this smart technology can do.
Still, blockchain has already made waves across a range of different industries.
Taking all into consideration, we are interested in exploring the potential implementation of this technology in the legal profession. It’s early days, yet some firms have already been investigating how the DLT technology might be applied to contract law for instance. In this blog, we’ll take a look at how blockchain might transform the legal industry.
Smart contracts are one of the ways to simplify the procedure of signing and executing contracts. It works pretty simply—you make up your mind, set up the contract, both parties sign it digitally, and then it’s automatically executed once the right conditions are met.
How’s this different from standard contracts? These contracts are computer programs, also called blockchain contracts or digital contracts that lay down the obligations of involved parties. Once the right conditions are met, the next part of the code is executed.
Let’s say, for example, that somebody has a fairly simple will. He sets up the smart contract to be executed once notice of death is inputted into the system. Ideally, safeguards are also put in place, so the system confirms that said death has been formally registered before going ahead with executing the will.
This could be achieved through a simple confirmation with the relevant authority’s records. Once everything is validated, the deceased’s property is easily transferred by updating the blockchain ledger at the public registry, and the relevant taxes, debts, and fees are paid automatically.
This would imply that a potential estate could be wound up in days, rather than months or years, and all at a significantly reduced cost. Nevertheless, we are currently nowhere near that stage just as yet, but it is conceivable that this will be made possible within our lifetime.
This is something that is currently pretty complex to manage and police. Part of the reason is that there’s no central record to draw upon. Once again, blockchain could change that. Let`s say you are a musician and you compose a piece of music – you could register your copyright on the blockchain.
This would make it harder for anyone to claim your work as their own, but there is an even more practical application – you could also choose to set up a smart contract with a recording company on the blockchain to receive royalties automatically for instance.
NKOR has already created a blockchain app that allows artists to register their intellectual property.
According to this infographic about blockchain disruptions from BitFortune.net, this tech could also be applied to property rights. Instead of registering one’s ownership at the relevant registry, one could register it on a blockchain app designed for the purpose. This would ensure that there are no missing deeds, without having to wait for weeks while the ownership records are updated.
One would simply enter into a transaction on the blockchain and transfer the funds for the property. As soon as the fund transfer has been verified, all ownership records are updated.
Overall, blockchain technology could help simplify legal transactions significantly in the future. We are currently not at the stage where we can leave it all up to tech yet, but that day is not all that far off.
Infographic URL: https://bitfortune.net/blockchain-disruptions-infographic/