Australian Corporate Lawyer - Autumn 2017

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blockchain. For example, the ASX is building a
market based on blockchain. Australia Post
has also revealed that it is looking at how
blockchain could be used
in verifying identity and performing
registry accreditation functions and has
made a submission to the Victoria
Electoral Commission on the use of blockchain
for e-voting.
Thomson Reuters has been looking
at blockchain on a number of fronts,
participating in the Hyperledger project and
announcing that it will be the first technology
and media partner to join the R3 global
banking blockchain consortium.
Future impact on in-house lawyers
It’s not hard to imagine a profoundly different
world for lawyers, both in-house and in law
firms, where most trade is transacted bilaterally
without intermediaries like banks, and
is governed by immutable public ledgers, not
hard copy contracts. You would imagine most
businesses and government agencies would
favour a blockchain system that promises
improved speed, enhanced ease-of-use and
lower costs of transactions.
As Allens Linklaters, in their excellent 2016
report Blockchain Reaction, stated, “Our
prediction is that distributed ledger technology
will fundamentally reorder the mechanics of
financial and other transactions. Businesses
will need to decide now to what extent they
will participate and invest in its ongoing
development.”
There are other areas where in-house legal will
be impacted:
• Use of cryptocurrencies in payments and
asset valuations.
• Use in proof of title and change of
ownership from creation.
• Proof of authenticity, e.g. the Don Bradman
signed bat in the boardroom might be
authenticated and tracked by means of a
blockchain. Provenance would be shown
by the blockchain ledger, not by a letter of
authenticity.
• Validation and management of identity.
• Chain of custody e.g. original documents,
confidential materials or evidence are
gathered and tracked in a blockchain
system rather than relying on testimony.
Kennedy and Monahan note that as
blockchain ledgers and systems become
more common, lawyers will need to know
that they exist, the possible evidence they
create and how to handle that evidence.
Discovery requests will need to take into
account the possibility of blockchain systems
and what specific information to request. Most
important, lawyers will need to know how to
explain to judges how blockchains work and
why they can be relied on.
Preparing for the future
Given the profound changes that the
blockchain might create, the first step is to
understand the basics of distributed ledger /
blockchain technology. There are numerous
books, Slideshare packs, podcasts, seminars,
LinkedIn Groups dedicated to this topic. A
simple Google search will get you going.
The second step is to engage with your
organisation’s digital strategy experts and ask
to participate in their blockchain deliberations
and experiments. Westpac’s Block16
mentioned above is an excellent example of
co-creating blockchain opportunities with
vendors. Why not organise a blockchain
hackathon in your organisation with your
external law firms and others?
The third step is to stay abreast of the likely
impact of blockchain on your specific industry.
Financial services are likely to be more heavily
impact than tourism. Notwithstanding,
tracking industry-based technology trends,
both here in Australia and overseas is essential.
It may feel like rose soil tilling now, but you
better be prepared for the earthquake.
Footnotes
1 Sourced from Kennedy and Monohan, “Lawyers Get Read,
There’s a Blockchain Coming”, ABA Law Practice Today, 13
January 2017
VOLUME 27, ISSUE 1 – AUTUMN 2017
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