The Clawd ecosystem can register an individual and/or documents within the Blockchain for continued verification and ensure the integrity of the document.
Blockchain is an operating system of interaction with the potential to vastly reduce the cost and complexity of business transactions. Blockchains consist of a peer-to-peer distributed ledger architecture that makes it easier to create cost-efficient business networks where virtually anything of value can be tracked and traded – without requiring a central point of control. The inherent capabilities of blockchain facilitate trust, accountability and transparency – while also streamlining business processes.
Individual identities are registered within the Blockchain where their identity and signature is legally, and globally, accepted and recognized. An individual’s role is certified and beneficial ownership is recorded. Identities and role in the company are verified every year to ensure authentication. Their signed documents are linked to their name within the Blockchain and are updated within real-time. There are no links which can be intercepted by outside parties.
They can use the system to legally sign and link eDocuments to their identity. Document metadata contains an audit trail of the document’s journey and modifications and that the scanning process is compliant with and follows international and national laws. The metadata is stored in the Blockchain and will reveal if a document has been tampered with or is missing.
How Blockchain technology can help your legal operations
Mitigate IT disruption to existing applications Blockchain can transform your transactional and legal operations by helping to:
- Reduce manual effort by up to 75%.
- Provide a single transparent platform that links multiple enterprise resource planning (ERP) systems and e-signature solutions.
- Virtually eliminate complex processes such as disputes, reconciliations, and workflow automation.
- Reduce operations costs.
- Enable real-time reporting.
- Decrease risks through verifiable and auditable transactions.
- Build trust through shared processes and recordkeeping.
- Digitally transform legal functions by integrating with technologies such as artificial intelligence (AI).
How Can Lawyers Use Blockchain Ledger Systems?
While the blockchain will disrupt the legal industry and eliminate external processes in several other industries, savvy lawyers can carve out space for themselves in the age of blockchain technology. It can be used to ensures the Chain of Custody for: Real estate lawyers and Intellectual Property rights just to name a few along with creating smartsContracts. Read the article below.
To understand how blockchain can revolutionize legal transaction processes, it’s important to understand the following fundamentals of the technology:
- Distributed ledger: Unlike many systems that store data via central repositories, blockchain uses a distributed database ledger. Therefore, all participating members of a blockchain network share access to identical information on accounts and balances.
- Consensus: A coordination protocol called a “consensus” algorithm maintains the shared ledger across the peer network. As the term suggests, the algorithm reflects the collective agreement of the network transactions. After a consensus is reached, business transactions can be committed onto the ledger — and cannot be changed or denied by any of the participants.
- Smart contracts: These represent the rules of blockchain like the contract “off-chain” is the rule of the parties. They are stored on the validating nodes in the blockchain. Enabling decentralized automation of business processes across boundaries, smart contracts are critical to operating a digital business.
- Permissions: Authorizations help ensure appropriate transparency and transactions that are security-rich, authenticated and verifiable.
Helping optimize legal transaction costs with blockchain
The mission of legal advisers is to close deals — accurately, in complete compliance and on time. But this effort is often easier said than done. Common challenges include:
- Significant process inefficiencies — resulting in costs
- A high volume of paper-based documents
- Limited ability to provide closing binders fast and cost-effectively, and legally authentic
- Compliance management complexity with digital documents
- Difficulty choosing the right technologies, such as e-signature and optical character recognition
- Lack of actionable insight on documents, contracts and forms data
- Strained participants relationship
Blockchain can overcome these challenges by offering the following benefits:
- Reduced cost due to straight through processing: Much of the work performed by legal teams stems from having to manage a huge number of paper-based documents or to capture metadata required for audit operations. Blockchain provides a single version of the truth for all participants to a transaction and give the possibility to analyze documents based on their authentic metadata.
- Reduced risks and improved accuracy of reports: With shared access to one consistent authentic version of the truth, document reconciliation and inquiries could become obsolete. Therefore, cycle times could also be expedited from days to minutes, enabling auditors, information managers and layers to focus on reports instead of documents and data manipulation.
- Fewer disputes and associated benefits: Verifiable and auditable ledger systems can mean fewer risks associated with signed documents, report integrity, the authenticity of metadata and documents and executable obligations related to a transaction. With access to blockchains, participants to a legal operation could gain visibility, non-repudiation of their actions and retrieve authentic information about documents in a timely and secure manner.
Benefits of Blockchain
- Reduce the document distribution cycle time from days to almost instantaneous.
- Make transactions more efficient by lowering overhead and reducing the number of cost intermediaries.
- Increase transaction visibility to help make tampering, fraud and cybercrime almost impossible.
- Increase the level of trust regarding transactions by using shared processes and recordkeeping.