Blockchain 101: It’s not just cryptocurrency #ILTACON18 #G009

Session Description: It’s the big buzzword now, but what are the basics that you need to understand to evaluate blockchain as a technology platform for you and your firm or department? Join us to learn about what blockchain is and why it matters. Learn why the importance of blockchain for the legal industry extends far beyond cryptocurrency. We will provide guidance about resources you can draw on to learn more about blockchain and to explore and develop your ideas for use cases.

Slides: [will be available after the conference]

Speakers:

[These are my notes from the International Legal Technology Association’s 2018 Conference. I’m publishing them as soon as possible after the end of a session, so they may contain the occasional typographical or grammatical error. Please excuse those. To the extent I’ve made any editorial comments, I’ve shown those in brackets.]

NOTES:

  • What is Blockchain?  It is another form of a network comprised of software, servers and databases. (It’s just a bunch of code.)
  • Decentralized.
    • no central location for information — this isn’t running on Amazon Web Services
    • network = thousands or millions of computers and databases and users
    • uses the computing power of all computers to transmit (=speed) and store information (=volume)
    • If any one computer goes down, the network does not. Each computer is a “node.”
  • Immutable.
    • Information in a blockchain cannot be altered (except in specific circumstances) = it’s NOT immutable
    • it serves a largely permanent digital record of information
    • digital identity verification and authorization tool
    • provides transaction authenticity and a trusted transaction records
  • Public or “permissionless” blockchain.
    • completely open allowing anyone to join and participat (rea, send transaction to and expect to see them if they are valid)
    • to participate, all you have to do is download the relevant software. All this software is opensource.
    • the security of the information tends to be greater in the public blockchain than in a private blockchain
  • Private/hybrids or “permissioned” blockchain.
    • each of these have their own rules of the road
    • these rules determine how immutable the records really are — what proportion of members must agree before a record may be edited.
    • the smaller the blockchain, the higher the likelihood that it might fail
  • Differences.
    • Privacy
    • Scalability
  • Use Cases in the Legal Industry.
    • smart contracts — these are a series of “if, then” statements that automatically trigger agreed actions without further human action
    • financial services
    • supply chain management
    • identity management
    • voting — blockchain can help ensure one person/one vote by time stamping a record of voting in an immutable form
    • data/asset registries
    • any situation that involves a lot of data, a lot of parties (that may not trust each other completely), the need for accurate records of each transaction
    • early uses in legal
      • internal contract automation
      • contract and deal negotiaon (and auto-updating)
      • calendaring
      • document authentication
      • client identifiy management
      • transaction recordkeeping
      • automated billing
      • service of process verification
  • Examples of Platforms in Legal.
    • OpenLaw (running off Ethereum platform). They are hoping to create a GitHub for contracts
    • The Agreements Network
    • Intergra’s Blockchain for the Global Legal Industry
  • Legal Working Group Examples
    • Wall Street Blockchain Alliance
    • Ethereum Enterprise Alliance
    • Chamber of Digital Commerce — Smart Contracts Alliance
  • Government spending on Blockchain
    • States are moving to use blockchain for government and recording
    • Federal government blockchain spending is set to rise for the third straight year
  • Challenges — this is still a very young technology. The Bitcoin Whitepaper came out in 2008.
    • interoperability
    • regulations
    • scalability
    • energy
    • security risks
    • investment decisions
  • Legal Industry Impact
    • Delaware blockchain initiative — law allows creation/maintenance of corporate records on blockchain
    • West Virginia pilot tested election voting by deployed military — they are using biometrics to validate identify
    • Vermont law approves blockchain data as court admissible
    • Illinois Blockchain initiative
      • medical credentialing process project
      • blockchain in government tracker
      • birth registration pilot project
    • Clients in the Logistics Industry are already pursuing blockchain (Blockchain in Transportation Alliance)
    • Store deal records on the blockchain (not on CDs or in bound volumes)
    • Typical legal functions and the vendors/technologies that use blockchain to support these functions
      • Document management system – -NetDocs, Integra Ledger
      • Document assembly — Thomson Reuters Contract Express, Integra Ledger
      • Document templates for smart contracts — OpenLaw, Ethereum
      • Contract management using smart contracts — Monax’s Agreements Network
      • Document execution, existence – -Basno, Blocksign
      • Notary services — SilentNotary, Ethereum
      • Service of Process — ServeManager
  • Groups working on legal industry opportunities
    • Global Legal Blockchain Consortium (Association of Legal Administrators)
      • ALA has developed the universal process billing codes
      • Standards of Alliance for the Legal Industry (SALI)
    • OpenLaw — they are creating learning tools to help any lawyer develop smart contracts
      • this is a Consensus Project
    • Accord Project
  • Top 10 Industries impacted by Blockchain
    • Banking (FinTech)
    • Healthcare (e.g., processing insurance claims)
    • Government
    • Real Estate
    • Legal
    • Security
    • Politics
    • Rentals and Ride Sharing
    • Charities and Aid Organizations
    • Education
  • What are the Big Four Doing?
    • Deloitte says that if your company is not already looking at Blockchain then you are planning to fail
    • PwC has developed an audit tool for blockchain
    • Accenture is viewed as the  third largest blockchain vendor behind IBM and Microsoft
  • What are the prospects? Gartner says by 2030, this will be a $3.1 trillion industry
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