Blockchain technology in the legal sector

Since its emergence in 2008, the blockchain, also known as the distributed ledger, has grown significantly. Bitcoins and other forms of cryptocurrencies have caught the attention of many investors and asset managers.

The simplicity of recording and securing data and the transparency of the public ledger make this new technology attractive to many. Moreover, the cost of using blockchain technology is significantly lower compared to traditional trading and accounting systems.

Keeping up with the changes in technology is relevant to all industries. Today, many firms in the legal industry are beginning to invest in the use of the distributed ledger technology. This step is also brought about by the reliance of many clients on the blockchain technology.

A 2018 survey reveals that 53.4% of UK’s top 100 law firms are investing in the research of Blockchain Solutions.

The ability of the technology to store huge amounts of records within a secured space means less paperwork for many legal advisors and reduced costs for physical storage. The blockchain will most likely be advantageous for ledger-related tasks, such as documenting and storing court records, pleadings, and contracts.

Many areas in the legal field will likewise benefit from the use of this technology. Among these areas are contracts, criminal law, dispute resolution, intellectual property, land registry, property law, and corporate law.

How will the blockchain technology transform the landscape of the legal sector?

1.      Simpler contract implementation with smart contracts

Smart contract is the term used for a contract that is transferred to the blockchain. This is different from the traditional contract where parties can stipulate and freely change the terms and conditions of the agreement.

Smart contracts are written in codes and are self-executing. The stipulations are kept in a public database and can no longer be modified.

These contracts are programmed to execute certain actions, depending on the criteria and qualifications met by the parties involved in the agreement. This makes intermediaries and third parties unnecessary for contract implementation.

As a result, manual processing and costs related thereto are reduced. It also lessens the risk of human error.

Traditionally, there are two parties involved in a contract. These parties come to a common agreement to bind themselves to the terms stipulated. The contract is deemed perfected from this moment, provided that the terms are valid and lawful.

In a blockchain, it is not enough that two parties agree and sign the document. The parties are further required to register to a blockchain platform by providing government-issued identification documents. This adds security to the transaction made.

Once stored in the blockchain, the contract will be shared in a network consisting of different users. This makes it almost impossible to hack. This security feature ensures that the data stored, along with the contracts, will not be tampered with or stolen.

Smart contracts may prove useful for banks, health institutions, insurance companies, and government agencies.

2.      Added protection to intellectual property rights and reduced approval period for the application and registration of intellectual property

Social media and the Internet have only made it more difficult for artists and authors to protect their work from infringement and to enforce their intellectual property rights.

It has become easier and simpler for many individuals from different parts of the world to copy, reproduce, or distribute works and content created by artists without their consent.

Another challenge for intellectual property applicants is the time it takes for government agencies to approve applications. The government agencies involved are tasked to manually review these applications.

Blockchain technology aids content creators and lawyers in rights management. The public database can provide time-stamps and information on who created the content first. This will significantly help establish proof of authorship.

It becomes less complicated for parties to track the users who have utilized and distributed the content.

Blockchain technology also reduces the time for government agencies to process applications for intellectual property, such as copyright, trademark, and patent.

To achieve this, authors are required to register to a blockchain platform and to upload their content to the database, after which the content will be visible to all members registered in the platform.

Users and consumers who want to access and utilize the content must likewise sign up into the platform. Once registered, the user is further required to ask permission from the author to utilize the latter’s content for a specified purpose.

Before an author approves the request, a smart contract is generated. Once the contract is perfected, the agreement will be stored in the public database.

3.      Added security to the custody and documentation of evidence used in litigation

As investigation of cases and litigation tend to last for several years, physical and paper-based pieces of evidence become vulnerable to getting lost and destroyed. Proper documentation of findings, transportation, and storage of evidence are, therefore, crucial.

While centralized databases can be used to store information on evidence gathered, they are susceptible to security issues. Blockchain technology can deal with this issue. The public database of the blockchain technology makes it highly unlikely for a single-point failure to occur since these pieces of information are stored in a network consisting of many nodes.

Moreover, the immutability (i.e. the inability to be changed) of the public database makes it impossible for the information to be altered despite long periods of time.

4.      Abbreviated litigation and dispute resolution and enhanced court proceedings

Litigation involves a lot of paperwork, as it includes work outside the courts. It includes arbitration, mediation, and other alternative modes of dispute resolution.

Blockchain technology aids in the speedy disposition of cases and reduces the clogging of courts with dockets. It also ensures transparency among all parties involved—the plaintiff, the defendant, the lawyers, the judge, and the jury.

All these parties are required to register to a blockchain platform. The judge can access the respective pleadings and records filed by the plaintiff and defendant.

Afterwards, the jury can make a verdict based on the records kept in the blockchain. This significantly reduces the time it takes to gather all pieces of evidence and to render judgment.


Although blockchain technology is a recent innovation, it is rapidly developing and penetrating many industries. Today, many governments have issued laws and regulations to prevent illicit activities from taking place in the blockchain and to ensure the quality of the system.

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