How blockchain has benefitted the legal industry 

Through blockchain, it has become possible for lawyers to streamline and simplify transactional work and provide safety to legal agreements. Scripted text, automated contract management and smart contracts have minimised lawyers’ preparation time and helped them personalise and maintain standard law documents. Such cost-effectiveness has been passed on to their clients. Also, blockchain has enabled everyone to access the justice system by reducing consumer complexity and high legal charges.

Blockchain will add transparency to the legal system

Distributed ledger technology has developed a shared ledger that all parties can access. Blockchain contracts follow compliance, with no surprises and the chance of misinterpretation.

Also, through blockchain, most of the tasks are conducted automatically, significantly reducing the time spent drafting and amending legal documents. Such cost was earlier passed down to the clients, resulting in higher rates of lawyers on an hourly basis. The inception of smart contracts will accelerate the process and cut down the transactional fees between parties. A cost-effective algorithm makes it possible to transparently and automatically handle escrow accounts with the least cost of manual labour. A decrease in cost will enhance the overall demand for legal services.

How blockchain will bring automation and make the system more efficient

Almost 48% of lawyers’ time is invested in administrative tasks, including transforming information between software and updating client trust ledgers. With the utilisation of pre-fabricated smart contracts and legal agreement repository, transaction work and non-billable administrative tasks can be automated easily. Blockchain implementation will reduce manual labour, speed up legal proceedings, and reduce customer charges.

Through blockchain, lawyers can streamline, disintermediate, re-engineer, and automate the legal industry without compromising on any judicial authority. The optimisation of various legal features and financial sectors will increase their efficiency.

Legal documents are like a honeypot for hackers, who always try to misuse confidential information maintained by lawyers. Instead of sending such documents in emails, lawyers can store them on a de-centralised, distributed ledger for enhanced data integrity.

Benefits of blockchain in the legal industry

  • Accessibility: Lawyers can digitally sign and store their legal agreements permanently through blockchain. Through smart contracts, it takes less time to personalise, prepare and maintain standard law documents. This aspect saves time for both customers and the legal industry.
  • Transparency: Contracts based on blockchain have baked-in compliance and hence provide no chance for ambiguity. As it works on distributed ledger technology, it creates a shared ledger that any party can access.
  • Cost Reduction: Automation reduces the time of drafting and amending legal documents. As the document cost is taken care of by the clients, introducing smart contracts minimises the transaction cost for both parties.

How can law firms employ blockchain to stay ahead in this technological era?

Law firms should create a big picture of how they can utilise technology like blockchain. This technology will continue to provide advancement for contract law. By combining blockchain with legal expertise, law firms can provide much-needed legal authority to their clients. As blockchain will continue to advance in future, the legal industry needs to understand this tech tool to leverage its capabilities to keep its legal practices at the forefront of the technology.

Challenges of blockchain technology in the law industry

The complexity of legal industry: Because evidence and documentation are sensitive, hard copies are preferred over digital copies, which may act as a barrier to the blockchain.

Legal issues: Although many countries have adopted blockchain technology, some still find it difficult to trust.

Bottom Line

Blockchain technology offers both opportunities and threats to the legal industry. Lawyers need to do considerable work to advise firms now using blockchain technology. To do so, they need to know the legal industry and technology well.

Hence whether you are a discrimination lawyer, car accident lawyer, dog bite lawyer or have any other profile, you must adopt blockchain to stay ahead in this competitive market. Also, regardless of location, you can implement this technology

Published by Kidal Delonix (1182 Posts)

Kidal Delonix is a contributor to Mr. Hoffman's blog. The views and opinions are entirely his/her own and may not reflect Mr Hoffman's views.

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