Blockchain’s Legal Agreements Network Makes A Case For Contractsbr>
The Agreements Network is a new tool for delivering legal know-how to the market. In the networked economy, legal contracting happens less on paper and moves to devices and software. Using the Agreements Network, lawyers and companies can design and operate contracts to perform legal jobs, such as contract management and collecting, storing and proving evidence. The Agreements Network’s legal reference layer is a tool for tracking important information like chain of custody for assets, but also supports creation of new products that will transform legal contracting for years to come.
Agreements Network founding participants will collaborate to validate, refine and test operation of the technology while addressing issues that will enable adoption and scaling of legal product solutions geared to meet the explosion of demand for legal “smart contracts.” Legal products augment traditional bespoke legal services. Legal products work by executing simple legal functions automatically at the network level and can be marketed and sold across a global peer-to-peer network. Complementary legal products will bring exciting revenue and client opportunities to any lawyer, while creating a more diverse and competitive marketplace for all consumers.
The law firms BakerHostetler, LegalBono and ErdosIP will be joined by tech companies Clause, Crowdcube, LexPredict, Libra, Mattereum, Monax, Rymedi, TransparentNode and Wolfram Blockchain Labs in the consortium.
“As the world moves ever further down the path of digitization the legal functions of most businesses are being forced to migrate and update their systems,” said Casey Kuhlman, CEO of Monax. “This is, fundamentally, a good thing. It will eventually reduce errors, increase certainty, decrease risk, and streamline operations at a core level.
Kuhlman talked with Block Tribune about the new service.
BLOCK TRIBUNE: What is a permissioned blockchain?
CASEY KUHLMAN: In its simplest terms, it is a blockchain which has a permission layer on it. The Agreements Network leverages the Hyperledger Burrow blockchain client which has a capabilities based permission layer. This means that when new accounts are created on the chain they will be given a global default set of capabilities to take actions within the network. Permissions can also be modified on a per account basis which allow a particular account to do things other than what is set as the network default. For the Agreements Network we set most of the permissions to “on,” we remove the ability for network operators to be able to change other accounts’ permissions (which is essential in an enterprise or consortium blockchain but unhelpful for a public blockchain), and finally change the ability to create new solidity code within the system to be routed through the validators and a governance process defined by the protocol.
BLOCK TRIBUNE: The service claims lawyers and companies can design and operate contracts to perform legal jobs, proving evidence – has this been tested in any court case?
CASEY KUHLMAN: Yes and no. If the question is whether electronic records are able to be submitted as evidence in a court, the answer is certainly. If the question is whether electronic means are capable of representing the traditional notion of a signature sufficient to bind an individual or company to a contract, the answer is it depends on the specific processes utilized by the signatories and also the jurisdiction. If the question is whether blockchain based contracts generally have been litigated the answer is yes — albeit the cases are still rare in the global scope of litigation. If the question is whether contracts on the Agreements Network have been litigated the answer is that the Network is not live and is still in testnet phases so not yet.
BLOCK TRIBUNE: Doesn’t this disintermediate law firms, to some degree?
CASEY KUHLMAN: Technology in and of itself has rarely, if ever, disintermediated incumbents. Our view is that the Agreements Network is built to enable global distribution and operation of legal products. The Agreements Network is public and can be used without permission by any law firm or individual lawyer based on their own desire to get technological scale behind their knowledge or proper legal processes and contract mechanisms.
BLOCK TRIBUNE: The service also supports creation of new products that will transform legal contracting for years to come. What are some potential uses?
CASEY KUHLMAN: Equipment Fleet Leasing: Facilitating As-A-Service Business Models
In the evolving network economy, devices upgrade and proliferate quickly, resulting in a trend towards pay-per-use and leasing models and in deployments of fleets of equipment, for example, robotics like drones. To serve this market, agreements issues such as unit function history, ownership, payments, rights of use, maintenance and insurance may all be parameterized as workflows in the Agreements Network.
Content Creators: Earning Money While Protecting Content Rights
The internet has generated profitable new media platforms for users to create and distribute content (YouTube etc.). Despite the vast opportunities, there are problems for creators of unique content, for example ownership of their intellectual property, ensuring fair remuneration, and protecting against third-party copyright infringement lawsuits. The Agreements Network is a powerful tool to meet these unique challenges.
Corporate Governance: Increasing Margins through Functionality and Reproducibility
Corporate governance (the rules and processes which control a company) is traditionally a meaty revenue stream for lawyers. The first stage in this essential business process is company incorporation or organization. The Agreements Network provides value by creating a persistent record of the incorporation instrument, to anchor further smart contracts for corporate governance, thus unlocking further potential legal work
BLOCK TRIBUNE: Are you building this blockchain, or using an existing one?
CASEY KUHLMAN: The Agreements Network is a standalone public, permissioned network based on Hyperledger Burrow that — once it is live — will be connected to other public blockchain ecosystems via the Cosmos meta-protocol.
BLOCK TRIBUNE: Can services be paid for in tokens?
CASEY KUHLMAN: Legal products distributed on the Agreements Network will be capable of being operated using tokens, yes.