What Your Clients Will Want You to Know About Blockchain
When many of us hear the word “blockchain,” we think of Bitcoin. But Judy Rinearson, partner at K&L Gates, thinks attorneys need to know: “The blockchain is not just cryptocurrencies. It’s a very intriguing and powerful technology that a lot of applications can run on.” The blockchain, she believes, will transform much of what lawyers do, in ways that have nothing to do with cryptocurrencies. “Your clients are going to want you to know about the blockchain,” Judy says.
Although there are a number of K&L Gates attorneys who are also coders and engineers, Judy is not one of them. She found her way to blockchain through her previous work at AmEx, where she worked on prepaid cards. “At that time in the late 90s, prepaid cards were talked about similarly to the way people talk about cryptocurrencies today,” Judy says. “The prepaid industry really had to fight to show that it had value, to show that it was relevant.”
When cryptocurrencies first started gaining popularity, colleagues turned to Judy’s expertise to help navigate it. “As the new crypto world started coming I was approached by a number of people in the industry saying ‘Judy, you were there when prepaid went from being the bad boys of the payment industry to being now a globally accepted, well-respected payment product. How did you do that? Come talk to us.’” Through those conversations, she began to realize that cryptocurrency was really just “the tip of the iceberg when it comes to blockchain.”
“I’m convinced that we’re definitely going to see #blockchain in the litigation space.” — #ModernLawyer @JRinearson on modernlawyerpodcast.com Click to Tweet
There are a number of blockchain applications that Judy predicts will directly impact legal practice. Widespread use of smart contracts is one of them. “A lawyer sees that the power of smart contracts are automated triggers that you build into a normal contract,” Judy says. She explains what that would look like in a simple contract: there is a sales agreement in which the parties agree that if the items are delivered, and if they pass inspection, then payment will be issued within a set number of days. With smart contracts, she says, funds could automatically be released after the items are delivered and inspected. “It’s transparent for both parties in the contract,” she says. “Payments are made without jumping through 3 or 4 or 5 other people. It all becomes much more seamless.”
Judy also sees a lot of potential in blockchain applied to litigation. “Litigation is a very time-driven, procedural-driven process that requires very careful following of specific guidelines, time deadlines,” she explains. “I think it would a great way to exchange documents, a great way to be transparent, and a really good way to show chain of title or chain of custody. I’m convinced that we’re definitely going to see it in the litigation space.”
Judy’s firm, K&L Gates, is taking a leading role in exploring applications of blockchain for legal practice. They’ve kicked off an internal blockchain initiative that involves setting up a blockchain sandbox, getting feedback from clients on the applications, and then establishing their own blockchain where they can build their own use cases. Judy explains that this program was developed out of an interest in staying ahead of clients’ expectations. “Lawyers, it’s in our nature, we serve our clients. And so the main reason I can tell you K&L Gates decided to get involved is because we knew our clients wanted it. The expectation of the clients was that you’re our lawyers, you’re a high tech global firm, you should know about this. And they’re right.”
To learn more about how blockchain might affect the future of legal practice, tune into this week’s episode of The Modern Lawyer podcast, available on iTunes, Soundcloud, and modernlawyerpodcast.com.
