16 hours Ago By Guardian Nigeria
Blockchain technology is bringing a new level of transparency, security, and efficiency to legal processes. As investors and regulators explore its potential, blockchain is no longer just a tool for financial transactions.It is now paving the way for more accessible, trustworthy, and streamlined legal practices.
With the increasing digitalisation of global systems, legal professionals must adapt to these changes to remain relevant and effective. Although blockchain is often associated with cryptocurrencies, its influence extends far beyond finance, transforming sectors such as law, where it is reshaping the way contracts, property records, and evidence are managed. This secure, digital tool is transforming how legal systems handle contracts, property records, and even evidence.
For legal professionals, understanding blockchain’s potential is essential, not only for advising clients but also for adapting to a future where blockchain could become a core part of legal practice. Understanding blockchain Blockchain is essentially a digital record securely shared across multiple computers. This distributed ledger technology links records known as “blocks” in a chain that can’t be altered, making it ideal for tracking legal transactions.
Because it’s transparent and secure, blockchain has the potential to transform legal processes, from how agreements are made to how compliance is managed. Key Applications of Blockchain in Legal Systems: Smart contracts: Simplifying agreements One of the most promising applications of blockchain in law is the use of smart contracts. These are self-executing contracts where terms are embedded directly into code.
Smart contracts enforce themselves automatically when certain conditions are met, cutting out the need for intermediaries and reducing disputes. For example, in decentralised finance (DeFi), smart contracts facilitate automatic payment transfers upon loan repayments or insurance claim approvals. Beyond DeFi, blockchain enables automation in supply chain agreements, where payment is released to suppliers upon delivery verification through sensors and GPS data recorded on the blockchain.
Similarly, insurance policies can be automated, ensuring prompt payouts based on predefined conditions, such as weather data or flight delays. Intellectual property and land registry: Protecting ownership Blockchain’s secure, unchangeable nature makes it a valuable tool for managing intellectual property rights and land registries. By recording ownership and transaction history on a blockchain, legal systems can ensure the authenticity and traceability of assets, reducing fraud and disputes.
For instance, Dubai’s land registry system uses blockchain to streamline property transactions. This allows buyers and sellers to securely verify property ownership and transaction history, making the process more transparent and reducing the chance of disputes. Similarly, artists and creators can register their works on a blockchain, establishing irrefutable proof of ownership and facilitating licensing agreements.
This could revolutionise copyright protection, ensuring creators receive proper attribution and royalties for their work. Chain of custody and litigation: Securing evidence In legal proceedings, maintaining the chain of custody is critical to preserving the integrity of evidence. It involves a clear and documented record of every interaction with evidence, tracing its source, handling, and transfer.
Any gaps or inconsistencies in this chain can jeopardise the admissibility of evidence, particularly in criminal cases where tampering could lead to wrongful outcomes. Section 84 of the Evidence Act emphasises the importance of ensuring the authenticity and reliability of electronic records. Blockchain offers a powerful solution to strengthen the chain of custody.
Its decentralised and immutable ledger creates an unalterable record of every transaction, significantly reducing the risk of tampering or errors. By logging each transfer and handling stage in real time, blockchain enhances transparency and reliability, ensuring evidence can be confidently presented in court. In cybersecurity and digital forensics cases, blockchain can securely document the handling of digital evidence.
For instance, in cases involving cyberattacks, blockchain systems can chronologically log when evidence—such as server logs or data packets—was collected, analysed, and transferred. The financial scope of blockchain technology and cybercrime Blockchain technology has experienced exponential growth, underscoring its transformative potential across industries. In 2021, the global blockchain market was valued at approximately $4.
5 billion, growing to $17.60 billion by 2023, and is projected to reach $1,879.30 billion by 2034, expanding at a CAGR of 52.
9 per cent. These figures demonstrate blockchain’s economic impact, positioning it as a pivotal force surpassing traditional industries like oil and gas. At the same time, cybercrime continues to inflict significant financial losses globally, with over $6 trillion lost in 2021 alone.
Blockchain’s transparency, immutability, and decentralised nature present critical solutions to mitigate vulnerabilities, secure transactions, and safeguard economies. Blockchain’s broader impact on legal systems Blockchain’s integration into legal systems isn’t just about adopting a new technology; it’s about reimagining how justice is served in the digital age. By automating routine tasks and providing a transparent platform for transactions, blockchain allows legal professionals to focus on complex, strategic issues.
For instance, decentralised platforms like Kleros use blockchain for arbitration services, providing more affordable dispute resolution mechanisms. Online legal clinics can also leverage blockchain to securely share documents and verify identities, reducing reliance on in-person meetings. These innovations demonstrate blockchain’s potential to make legal services more accessible, efficient, and trustworthy.
Challenges and considerations While blockchain holds great promises, its widespread adoption also presents challenges. Legal professionals and regulators must address issues surrounding regulatory compliance, data privacy, and the standardisation of blockchain protocols. For instance, how do blockchain-based systems comply with data protection regulations like GDPR, especially when handling sensitive personal data? Furthermore, lawyers will require specialised training to effectively utilise and advise on blockchain-related legal matters.
The legal industry is taking steps to address these challenges. In the U.S.
, some states have begun recognising smart contracts as legally binding, but global acceptance varies. International cooperation is crucial to establish a universal legal framework for recognising blockchain-based evidence and contracts across borders. This requires developing standardised protocols for data handling and identity verification, as well as ensuring interoperability between different blockchain systems.
Onyiuke is a Senior Advocate of Nigeria and a partner in Accendolaw Partners LP, Lagos while Anene is a supervisory associate counsel in the firm with deep focus on digital assets. Addressing scalability is also vital, as some platforms may struggle to handle the large data volumes generated by legal processes. These efforts are essential for ensuring the seamless integration of blockchain technology into the global legal landscape.
While these challenges are significant, they are not insurmountable. With continued innovation and collaboration among legal professionals, regulators, and technologists, blockchain can seamlessly integrate into legal systems, driving transformative change. Looking ahead Blockchain technology is poised to revolutionise legal systems by introducing new levels of transparency, security, and efficiency.
As the legal industry continues to explore blockchain’s potential, professionals who are familiar with this technology will not only adapt to the digital age but also help shape it. With real-world applications already underway, blockchain is quickly proving its value as an essential tool for the future of law. By embracing this technology and addressing its challenges, the legal profession can unlock new possibilities for delivering justice in a more accessible, efficient, and trustworthy manner.
Legal professionals who are familiar with blockchain technology will be better equipped to navigate the evolving legal landscape and provide innovative solutions to their clients. By understanding the potential and limitations of blockchain, the legal industry can harness its power to redefine justice for the modern world. Onyiuke is a Senior Advocate of Nigeria and a partner in Accendolaw Partners LP, Lagos while Anene is a supervisory associate counsel in the firm with deep focus on digital assets.
.
