Technological changes keep happening and these influence how various sectors operate bringing changes to the experiences of the end users too. However, not all industries adapt to technological evolution equally. Internet technologies have changed human life in massive and unprecedented ways and invention of blockchain is also very disruptive- say the experts. Blockchain is not only meant for developing crypto currencies- contrary to the mass perception! In fact, it has already been adopted by many industries like automotive, banking, insurance and education- in a number of ways. The legal sector has been slower to respond to it but slowly its adoption in legal scene has picked up pace.
Why use blockchain tech in legal sector?
Initially, it may seem law and blockchain are two very different sectors and they may not have to do anything with each other. However, there are many reasons for incorporating blockchain in the legal sector- as it becomes clear in finer analysis.
- Data safety and ease of sharing- The majority of law firms deal with huge amounts of data including client information details and millions of case data. This data keeps growing with time. Keeping such gargantuan amounts of data safe and easily accessible can prove to be tedious-more so for large law firms. Usage of advanced cloud storage has made things better but using blockchain enhances the safety level. Blockchain is a decentralized ledger which is hacking proof-almost. The safety of data will not be compromised when blockchain is deployed and there is no single server to hack. Using blockchain can also help speed up operations in the legal sector. Data sharing between various related parties will be simpler and faster.
- Better contract management- In legal scene, making contracts and agreements is a prerequisite and it is required for many things. Examples include contracts and agreements for house mortgage, offering rent, selling property, leasing lands, buying and renting cars, insuring vehicles and many more. For such needs, the lawyers and law firms need to frame various contracts and agreements. While software usage for such work is common now, using blockchain tech is even better. Smart contracts, when deployed ensure transparency is involved in the process. Owing to immutable nature of blockchain, agreement once made cannot be tampered in any way.
OpenLaw is one nifty Blockchain-based application that law firms and attorneys are using to make legal documents nowadays. More such apps are expected to come up in the near future. It has pre-set algorithms and inbuilt templates to create accurate documents.
- Enhanced efficiency – When blockchain is deployed for making and managing legal documents and contracts, the lawyers are relieved. Same is applicable for employees working in the law firms. When the basic and repetitive tasks are handled by blockchain powered apps accurately, the lawyers and staffs can focus on other important work. This helps enhance their efficiency at work.
- Better case study handling and access- The lawyers need to study hundreds of cases when they are at work. Accessing printed books and materials can be tedious. Digitization does help but blockchain usage helps take things to a new height. Data saved using this tech cannot be altered and it is easily accessible. So, the lawyers do not need to depend only on the agency staffs or printed materials to do intensive case studies.
- Significant time saving- The legal sector is known for delays in almost everything though things have improved compared to the past. Not all delays are intentional though. A huge amount of time is lost in accessing case information and sharing relevant data between various teams. From lawyers to the judges, everyone can get work done faster-this way. Eventually, less time will be required to resolve the cases-benefitting everyone.
- Enhanced identity verification- In legal sector, verifying identity is a prerequisite. It can be required for anyone involved in a case or even for making a rent or sales agreement. The existing id verification methods can take time and risk of frauds does exist. By using blockchain, identity verification can be faster and fraudulent identities can be caught. This will be especially helpful in legal sector recruitments and insurance claim verifications.
Future of blockchain in the law sector
Admittedly, the legal sector has been slower in adopting blockchain technology but a number of entities have started using it –in the last few years. Eminent law firms like Alistair Maughan, Hogan Lovells and Fieldfisher are already experimenting with this emerging technology. With time, even the midsized law firms will warm up to it. The benefits are too big to ignore-as it is.
There are a few hurdles that may slow down blockchain adoption in legal scene-feel the industry experts. The GDPR in the EU countries is one regulation that may act as hindrance. There is a perception that adopting this tech on large scale in legal sector may lead to some amount of job loss. Combining blockchain apps with AI may reduce the need of relying on certain types of legal professionals. However, it is clear that legal sector cannot operate without using technology. It is a matter of few years before blockchain deployment in the sector becomes more widespread.