Currently, smart contracts are gaining prominence because of the emergence of blockchain technology and the popularity of cryptocurrency. In particular, there is more acceptance of the verification of transactions on a public or private blockchain. One notable legal change in corporate law related to blockchain, which might, therefore, spur more use of smart contracts, is the Delaware Blockchain Initiative and the amendments to the Delaware General Corporate Law, which, among other factors, permits issuance of distributed ledger shares.
In an article for the March/April 2018 issue of Thomson Reuters’ FinTech Law Report, partner Huu Nguyen and a global director of research services conclude that in order to prepare ourselves for the adoption of smart contracts, particularly artificial intelligence (AI)-empowered ones, lawyers must keep abreast of the current technology and understand its limitations. Clients may ask their lawyers to work with their programmers to translate a smart contract into code that may very well execute on the blockchain for a long time to come. These pros and cons, the authors write, present legal challenges and opportunities. With the proper implementation and regulation, these arrangements could revolutionize business and the law.