LSB Advocate Increased Use Of Blockchain Technology
The Legal Services Board (LSB) is encouraging more legal services regulators to promote the uptake of Blockchain technology by regulated firms.
Research conducted by the LSB has found that only 2% of legal service providers have started using Blockchain technology whilst only 5% of all legal service providers have already made, or plan to make investments in law tech businesses, products and services.
Advocates of legal technology and the use of blockchain working with the LSB have claimed the uptake has been mainly limited to the financial services sector.
It has been argued during the LSB’s recent ‘Talking Tech’ podcast that a more efficient working process, driven through innovative distributed ledger technology (DLT), will reduce timescales and improve the conveyancing and consumer journey.
Dr Anna Donovan, the inaugural vice dean of innovation at University College London’s Faculty of Laws, said:
“Blockchain provides significant opportunities to enhance consumers’ access to legal services, particularly once we reach widespread adoption. This will mean that consumers can have their legal needs met in a more direct, faster and potentially cheaper manner (in comparison to current models).
“Whilst this technology is currently the focus of the financial services sector there are huge opportunities across the legal services market, including for example in conveyancing and probate.
“At the moment, a small number of legal services providers are offering services to their consumers that leverage smart contract technology, whilst others are developing complementary dispute resolution mechanisms. That said, at this time (and as this is still a nascent technology), the majority of work within the sector is advisory in nature.”
“At the moment investment is largely coming from financial services, where there is capital to invest and where the nature of financial services transactions lends themselves to this kind of technology.
“To help the adoption of DLT within the sector in a sustainable manner, one that reaches the right balance between innovation and consumer protection, regulators are well placed to use their convening power to support multi-disciplinary research, increase understanding across the sector and, where appropriate, provide best practice guidance, training and information.”
Dr Helen Phillips, Chair of the Legal Services Board, said:
“The potential uses of blockchain technology are both enormous and exciting, and it’s vital that the legal services sector seizes the opportunity to use it to improve access to justice.
“Distributed ledger technology has the potential to drive considerable time and cost savings for both providers and consumers of legal services. It increases transparency, builds trust and speeds up transactions, all of which will benefit consumers.
“The financial and banking sector has made significant strides in exploring the benefits of blockchain and I hope the legal sector follows suit.
“It’s important though that we all understand the risks and potential pitfalls of these innovations, and the LSB is looking carefully at the role regulators must have in protecting users of legal services. We need an approach that balances fostering innovation with consumer protection.
“Legal regulators must not ignore the opportunities and I look forward to working with partners to understand and agree how everyone can benefit from new technology.”
Should more law firms start embracing Blockchain technologies?