Making Legal Contracts Smart

“(…) The potential to automate a wide variety of business transactions in a way that is secure, transparent, and flexible will likely be one of the most transformational benefits of blockchain. However, software applications that use distributed ledger technology to automate business processes are often confusingly referred to as “smart contracts” despite not being tied to any legally binding obligation or, worse still, not being enforceable in court. In contrast are smart legal contracts: legally binding agreements whose underlying logic is transformed through computation to enable automation, software connectivity, and dynamic business arrangements.

Automated transactions must be executed according to the terms of a legally binding agreement to provide companies with certainty and the ability to be compensated if something goes wrong. Smart contracts that are executed apart from a legal agreement cannot be fully integrated into an enterprise digital transformation strategy. Fundamental transformation requires consolidating systems end-to-end and involving a company’s legal agreements. And even if legally enforceable, smart contracts that operate without incorporating standards will likely be an isolated phenomenon without the full benefit of marketwide adoption. Worse still, smart contracts that are inaccessible to legal and business professionals are likely to remain more of a curiosity than transformational.

The Accord Project was established, in part, to develop a community driven protocol for smart legal contracting. It is built on the fundamental notion that contracting is, and should be, blockchain agnostic. Users are therefore able to use Hyperledger Fabric, Ethereum, and others as warranted. The Accord Project is an Associate Member of Hyperledger and is a consortium of attorneys, technologists, and organizations collaborating to set techno-legal standards and develop open source technology. But it’s not just talk. The Accord Project has already operationalized its vision through the open source software called “Cicero.” (…)”

Via Hyperledger – read full article here:  http://ow.ly/RwzC30j3g0f

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