Tokenizing Contracts on OpenLaw and Ethereum

Open, ESQ
Income Share Agreement template // supports Ethereum tokenization

Legal Rituals for enforceable promises can get fairly elaborate 🤝⛓.

\/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/

Competing denominations of legal faith have made drafting enforceable promises even murkier, with law firms and similar market participants espousing their own brands of promise-keepers, or, Contracts.

Despite this legacy of paper chasing in business deals, the internet continues to liberate a great deal of contract law corpus and similar promise-keeping rituals, through what has been sourced through law firms themselves, such as Cooley GO and the Orrick Startup Forms Library, and by broader efforts like the NVCA model legal templates for venture financing.

As it stands: Things are looking rosier for legal consumers: for legal form gatekeepers, less so. But we digress. . . .

To the point and carrying the torch: “Market Legal Forms” built around open-source templates and communities can rapidly grow markets by clarifying the consequences of a given deal pattern through a feedback loop of negotiation and dispute resolution on common terms.

✨📜✨ // behold, the platonic ideal of legal template, yet unformed, but aching to mince words with the internet! //

\/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/

For nascent markets, like the creation and assignment of income shares to finance higher education or “ISAs” //

(students contract to sell “stake” in future income for education or related loans)
👩‍🎓🤝💸

legal template acceleration through open-sourcing seems like a clear path to bootstrap the wisdom of the Market for this new scene⚡.

Better yet, having a neutral accounting system that doesn’t rely on legacy players or the coordination of human capital to manage assignments under ISA Forms can make legal satisfaction far more predictable, and therefore, valuable for secondary market participants 🤖.

\/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/

For example // 🌈

If Bob loans Alice $100k to support her Stanford education for a stake in Alice’s future earnings under an ISA, Bob can immediately benefit from this papered legal event by then assigning his future income claims through another contract to Carol for a lump sum payment 💰.

// ❤️ Legal Assignments LOVE Digital Tokens 🏵️ //

Mirroring an ISA claim on a public blockchain like Ethereum further supports the security of such paper ISA assignments by stamping the underlying, obliging legal references into an easily traceable digital artifact, like a Token ✨📜 // 🏵️✨.

We have been hard at work developing such blockchain solutions for the ISA market, and are proud to present our findings!

/\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\ /\

For OpenEsquire, it is our mission to make Ethereum tokenization simple and relatable to students, educators, and potential lenders alike.

Ideally, tokenization and other technical assists become invisible support beams for online dealmaking and everyone sleeps better with more money in their pockets.

// At this moment, Open-Sourcing a Master Form of ISA seems both readily achievable as well as decisive in showing the benefits of blockchain accounting for legal contracts //

To this end: We are pleased to have recently partnered with Polybird Exchange in order to pilot and develop a base template for ISA on OpenLaw as well as an Ethereum tokenization mechanism that credibly supports ISA assignments for secondary market trading.

In the course of our partnership, we were also delighted to come across the story of Widya Imanesti, an international student pursuing a master’s degree at Cornell who adopted the OpenEsquire ISA and helped us further refine our workflow in collaboration with her sponsor, EnableCredit, which is currently exploring education crowdfunding through ISAs denominated in DAI stablecoin.

\/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/ \/

Now, we are even more pleased to open-source the OpenEsquire ISA template from our private library, enabling anyone with a free OpenLaw user account and MetaMask digital wallet to begin experimenting with Tokenizing Contracts 📜 // 🏵️:

ENTER OPENESQ ISA:

(Drafting ISAs has never been simpler)

The OpenEsquire ISA has default terms collected from our work with collaborators, easily adjustable through a sidebar questionnaire:

We have also weaved in crafted references to blockchain accounting and the concepts of tokenizing balances of claims in order to allow parties to easily incorporate digital asset and blockchain-based repayment schemes into their ISA deals, placing future performance entirely online:

Section 2(c) accounts for Tokenization of ISA
Section 4(d)(iii) accounts for digital asset repayments by student to satisfy ISA obligation

The OpenEsquire ISA template also includes simple inputs to tokenize and program negotiated loan payments on Ethereum mainnet using our ERC-20 token factory and embedded DAI stablecoin scripts:

A glimpse under the hood:

We Markup So You Don’t Have To // But Feel Free to Ping Revisions!

Each OpenEsquire ISA also allows anyone to raise their hands for help and contact us about aspects of tokenizing their ISA and related opportunities (we are added as reviewing party with one click . . . ):

Come all ye bold ISA Tokenizers!

This is the end result 📜🤖👍:

Smart Contract Execution Buttons at Top of Execution Screen
Human-Readable ISA Text

In the above image, you might also notice the hash of the OpenEsquire ISA contract executed by the parties, “14f2d1ad31eb79a928977446e293d5fb0268431c1b923ffd9dd81351361e128d”

Going ahead, this contract hash is a unique value and will distinguish our Ethereum digital artifact from other copycat tokens that might purport the same related legal obligation.

Upon clicking the tokenization button and confirming the MetaMask popup . . . 👀

This hash value will be stamped as the name of the token, providing a highly-legible reference to a real legal contract and the future (judge-enforceable) obligations it entails:

LINK: https://etherscan.io/token/0x2d1ddff7a9a56ce181f79e74fc2f3025966b527d

Short Clip of this exercise:

What next?

Try out OpenESQ ISA:

https://app.openlaw.io/template/Income%20Share%20Agreement%20(OpenEsquire)

List with us:

We are also happy to discuss how to list your digital assets with our partner Polybird, whether a student, lender, or other ISA market participant.

Otherwise: Reach out and join us on this journey! ✌️

info@openesq.tech

Open, ESQ

Written by

Open, ESQ

Our mission is to educate attorneys about Ethereum smart contracts.

Welcome to a place where words matter. On Medium, smart voices and original ideas take center stage - with no ads in sight. Watch
Follow all the topics you care about, and we’ll deliver the best stories for you to your homepage and inbox. Explore
Get unlimited access to the best stories on Medium — and support writers while you’re at it. Just $5/month. Upgrade