This is a deep dive on the future of work around the world and the technology trends that impact them.
It was a ton of fun recording this podcast with the omniscient and ever engaging Joseph Gartner at the ABA Center for Innovation – (full transparency, I sit on the Council). With Joey’s new role as Director and Counsel, we chatted all things #blockchain, #cryptocurrencies, and #NFTs and their impact on the legal industry. It is fantastic to be a part of a group pushing on #innovation in the legal industry at the ABA with Chair, Don Bivens and the entire Center for Innovation Governing Council.
Question: What do the Iranian national football team, NFTs, Hotel Rwanda and tennis great, Andy Murray have in common?
Answer: Stevie Ghiassi, Co-founder of Legaler and Legaler Aid. And my guest this week!
In this episode, Stevie chats with me about his unlikely journey from running a chain of souvenir shops to becoming a legal tech entrepreneur. He also talks about the important work that Legaler Aid is doing, and ways in which legal tech and blockchain have helped them pivot after Covid took away traditional fundraising streams.
Yet again we’re seeing innovative ways that cryptocurrency and blockchain are being used, and how they offer real opportunities for the legal industry.
Interview with Joseph Raczynski, written by Michelle Worrall Tilton
Attorneys look to precedent to solve today’s legal problems. “Steeped in tradition” is how we often describe the legal profession. As result, it’s no surprise that there is inherent tension between emerging technology and the legal profession. The American Bar Association’s 2020 TechReport, which surveys firms and tracks attorney use of technology in their practices, reported that only 7% of attorneys are using tech tools, such as Artificial Intelligence (AI), for document review and research. Firms with more than 100 attorneys are more likely to use AI, as well as firms that engage in mass tort litigation. Despite promises of increased efficiency, productivity, and profitability, a significant number of attorneys cite distrust of the technology and underlying algorithms.
Even though the legal services market is estimated to be a $1T industry globally, Forbes reports that it is also one of the least digitized:
That is, until the COVID-19 pandemic forced the legal community to remote hearings, yoga pants, and dining room tables seemingly overnight. Prior to the pandemic, the ABA’s 2019 TechReport estimated that the vast majority of law firms of all sizes – other than solos – worked in traditional law firm environments. Now, many managing partners are rethinking their office space needs because technology allows attorneys and staff to work from home. Cloud-based document storage doesn’t demand the physical space once required for the paper detritus of the legal practice.
According to commercial real estate brokers with expertise in law firm office space, firms have been downsizing for some time – and the trend is expected to intensify post-pandemic. It’s anticipated that firms will increasingly implement a hybrid model where employees schedule the use of a community workspace or a conference room, but otherwise work remotely. This provides the opportunity for collaboration and meetings with clients in a professional and inviting setting – think chic hotel lobby – while reducing the real estate footprint and attendant expense.
Despite the occasional mishap of appearing in virtual court as a cute kitten, the legal profession has progressed in dog years with respect to the use of technology during the pandemic. Remote hearings provide greater access for certain types of cases and hearings. Litigants and their attorneys are saving time and money by not having the hassle of travelling back and forth to court. It’s easier for litigants to attend hearings remotely without having to take off as much time from work or to arrange for child care. Corporate clients are now accustomed to remote environments and online meetings. Many companies, such as Salesforce, American Express, and Microsoft, have reverted to permanent work-from-home arrangements for some employees. A silver lining of the pandemic is that the legal industry has had no choice but to embrace technology. So, what will the practice of law be like in the next twenty years?
Fortunately, we don’t have to guess how technology will transform the legal profession in the years to come nor do we need to rely on a DeLorean time machine with a mad scientist sidekick. Thomson Reuters Corporation has a forward-thinking technology specialist on the payroll with the title of “Futurist.” Joseph Raczynski is a Technologist & Futurist, Manager of Technical Client Management for the cutting-edge legal products and services company. Raczynski, who is based in Washington, DC and focuses globally specializes in the future of technology and its impact on the legal profession. He has expertise in cybersecurity, blockchain, artificial intelligence, cryptocurrency, and drone technology. Raczynski also hosts a popular podcast, The Hearing, which focuses on legal innovation.
After talking with this fascinating tech expert via halo-conferencing (not really, but made you wonder), it’s clear that technology will play a significant role in the future of the practice of law. While firms were pushed to adapt and use new technology during the pandemic, some firms that have operated for decades with little change, may revert back to that mindset. Firms, however, that buck the system and invest in technology will thrive in the long term. According to Raczynski:
Firms that are willing to embrace technology will provide better services for their clients. They will be better able to quickly sift through and digest immense sums of information. “In the decades ahead, data and services to understand that data will reign supreme,” Raczynski predicts. Facing pressure from corporate clients to cap rates and reduce billings, some firms are incubating legal tech companies to speed development of software and other products to facilitate the efficient delivery of client services. Those that are successful will license their internally developed tech services to other firms or sell the technology to companies. Either way, these entrepreneurial firms are generating new revenue streams while developing tools to better serve their clients. For example, national plaintiff personal injury firm, Parker Waichman, developed case management software, which it licenses to other firms to help them manage mass tort litigation. Not to be left out, smaller firms are banding together in collaborative settings to invest in technologies together that they wouldn’t be able to manage financially on their own.
With insight from Raczynski, let’s zoom ahead for a glimpse into the future.
Raczynski predicts that current roles undertaken by attorneys will change significantly over the next twenty years. “Much of the rote work being performed now, will be gone,” he says. “That said, many new facets which we haven’t even conceived will likely supplant some of those activities.” Certainly, AI imbued eDiscovery tools will be the norm for document review. This technology eliminates the “amounts of eyes on pages,” he says.
AI and machine-learning will continue to facilitate and expedite research and trial practice. Raczynski describes how attorneys will have computer applications at their . Research platforms will have semantic and nuanced understanding of the actual meaning of legal opinions and will go well beyond key-word matching. The applications will quickly access every case and ruling on point and “spit out decisions,” which will likely be “the final decision,” or at the very least be “augmented intelligence” to assist the judge or jury, he predicts. Litigation will become less burdensome and more efficient for the majority of cases. Perhaps, too, this will result in significant financial savings to clients. Interestingly, Raczynski anticipates that technology will reduce courtroom drama as finders of fact will make decisions based on data – and be less influenced by attorney performance. Courts will be virtualized with mixed reality 3D glasses for the judge and jury that will bring crime scenes, accident reconstruction, and other cases to life.
Outside of the courtroom, Raczynski anticipates that technology will automate transactional work. While contract negotiations will still exist, “everything will be interactive, voice automated, templated, intuitive, and securely stored on a blockchain,” he says. Blockchain creates an immutable, digital record of transactions. It eliminates human error, which is commonplace in contract drafting. Retinal scans will be used to confirm the validity of executed documents.
Blockchain technology, according to Raczynski, will be run so that triggering language on this platform will automatically negotiate deals or execute contractual obligations. “What we are talking about is fully codified contracts,” he predicts, “with the ability to interact with factual data and either negotiate on its own, based on Party A’s and B’s preferences, or even self-litigate when something in the code goes awry.” While blockchain is still somewhat nascent and the stuff of computer scientists, it will transform global commerce and the practice of law.
Technology will also transform law practice management and allow attorneys to spend more time serving clients instead of handling administrative issues. Thomson Reuters conducted a study on time management and reported that with smaller firms, approximately 61% of their time was spent practicing law. The balance of their time was spent on the business of running the firm, which is crucial, but not a billable activity. The larger the firm, the less time spent on administrative work. In the future, law practice management will be facilitated through the use of a decentralized autonomous organization or DAO. This is a business model structured on self-executing smart contracts that function without the need for in-person decision-making. Smart contract governance doesn’t require boards of directors or firm management committees to meet, analyze data, and make decisions. Rather, a DAO outsources the analysis through smart contracts allowing for token-holder network consensus. Voting attorneys would hold tokens based upon their seniority, billings or pecking order status.
Admittedly, much of this technology is difficult to explain let alone visualize in practice. However, there are steps that law firms should be taking now to better position themselves to be able to leverage emerging technology. “Opportunity abounds in the legal market right now,” Raczynski says. He portends a golden age for the practice of law: the intersection of where the legal industry marries technology. While firms of all sizes were once reluctant to spend disposable income on technology – even on network security – large firms, in particular, are starting to increase their IT spend and budget for the future. Planning and budgeting for the proactive use of technology are key first steps.
There has been a significant shift in law firm operational budgets allowing for an increase in technology spending. As attorneys have become more technologically advanced, there has been less need for clerical staff to draft pleadings and correspondence, perform filings, mail letters, and other tasks. Younger lawyers, who have never used a Dictaphone or fax machine, have long been drafting their own briefs. Since the recession in 2008, firms have been increasing attorney-to-clerical ratios and spending less on clerical support staff. A legal secretary, who once supported one or two attorneys, is now working with eight or more. As described earlier, firms are spending less on their office leases by reducing square footage. Technology has filled the void left by these drastic operational changes, while freeing up cash for reinvestment in IT products and infrastructure.
Importantly, technology also levels the playing field. Solo and small firms are poised to benefit as the cost of technology decreases. “If they decide to embrace technology, Raczynski says, “it enables them to automate, find answers quickly, and respond to their clients with aplomb.” He recommends that solo and small firms connect with the growing LegalTech community to see how they can learn, interact, and leverage new ideas to benefit their practices. Additionally, law schools are excellent sources for technology training and incubating new ideas.
In Tomorrowland, there will be significant opportunities for tech forward iGeneration attorneys. Law school graduates, who grew up with mobile devices in their strollers, will have key leadership roles. Attorneys with degrees in engineering, network security, computer science and coding will be valuable hires. As technology is second nature for them, they can undertake important IT operations and reverse-mentor firm members who aren’t as tech savvy.
Finally, corporate clients aren’t going to wait for their hometown attorneys to become comfortable with emerging technology – especially when some firms are deploying high tech tools in their practices. Corporations are investing in their own technology infrastructures and expect the same commitment from their professional service providers. They also expect law firms to engage in vigorous network security to protect sensitive client data from malicious actors, which is a real threat. Ideally, law firms will automate routine research, drafting, and discovery review, so that attorneys can focus on customer service, including responsive and timely communications, learning about their clients’ unique business needs so they can be proactive instead of reactive, and cultivating new client relationships.
There is no time like the present to prepare for the future. Attorneys should attend technology conferences, network with legal service vendors, join cyber law committees, and connect with futurists like Raczynski to gain a better understanding of the technology that is already transforming the practice of law. Learning something new will feel uncomfortable at first, but it will get easier. The DeLorean is idling out front and ready when you are.
In a two-part series, we will look at Non-Fungible Tokens, explaining what they are and how they will impact numerous industries; and how decentralized finance (DeFi) is critical to understanding NFT’s importance within the legal industry.
Originally published on the Legal Executive Institute.
By Joseph Raczynski
Welcome to the early days of where blockchain goes mainstream, and the legal industry needs to take notice.
While Non-Fungible Tokens (NFTs) have been around for several years — remember CryptoKitties or even the original NFT, called CryptoPunks? Even if you don’t, NFTs have officially exploded into popular culture, begging the question: So, what are they?
A Non-Fungible Token is a token stored on the blockchain, which itself is a secure distributed database with redundancy, immutability, and clarity into tracking data or ownership. A token proves ownership of an asset. For example, a deed to your house is a sign of ownership to that plot of land and building. In the case of the first digital token, Bitcoin, a single Bitcoin is the title of ownership to the underlying value of the Bitcoin.
Fungible refers to an asset that is easily exchangeable. In the classic example, a dollar is very fungible — you can hand a dollar to me in exchange for some gum, and I can then re-use that dollar for a can of soda. The physical dollar maybe different because I swapped with another in my wallet, but it is easily replaceable and exchangeable, so it is fungible.
Now, it gets interesting. A non-fungible token is a unique token that is not easily exchangeable or replaceable with another. With the mania that is occurring with NFTs, the best example is with art. Recently, Mike Winkelmann, known as @Beeple, a renowned artist who has worked with Nike and Apple, sold 20 pieces of his own work on the digital marketplace Nifty Gateway for a total of $3.5 million. And in the latest eye-opener, he sold a collection of many of his works combined into a masterpiece, titled EVERYDAYS: THE FIRST 5000 DAYS at Christie’s for $69 million. These transactions occurred on Ethereum, the primary blockchain platform of record for storing value, but Winkelmann’s art itself was simply digital images.
With the NFTs, we are proving that rare and scarce representation of things can create value, and that value can be captured on the blockchain. Let your imagination run wild for a moment: What this means is that nearly anything and everything that is represented digitally could also carry provable value.
For example, Jack Dorsey, CEO of Twitter, is in the process of selling his first Tweet, the original Tweet of Twitter. It is, as of this writing, estimated at a value of $2.5 million and projected to go higher. Why might you ask? Well, it is feasible to collect royalties on that tweet once you own it; or, you could hopefully resell it in the future. Lastly — and again, I beg your imagination for this thought — in the not too distant future, with people living in virtual reality, these pieces of art will have a home inside those worlds, too. Other examples, the NBA has now gotten in on the action by leveraging NBA Top Shot, selling limited edition, finite numbers of virtual basketball cards, including a short clip of a LeBron James dunk, which recently sold for more than $200,000.
In the past, I discussed asset tokenization, which is the simple idea that nearly anything could be represented on the blockchain as having value. It this is now happening. This could be a painting, your car, a house, or even a Tweet. Essentially, if you have something original, that you can then prove is yours, that item can derive value.
Through the lens of the legal kaleidoscope, we are entering a complicated but colorful place, and there are an incredible number of areas this will touch. As technology push us to rethink what we know, NFTs shall do the same. In this nascent area, contemplation about the impact on both the practice and business of law will hit multiple fronts. Here are just a few:
- Intellectual property — NFTs carry a huge target on their virtual backs from the IP angle. At the heart of these tokens is uniqueness and ownership, and that means that eventually, litigation will follow.
- Trust & estates — Possession comes in the form of a digital wallet. Access to the private and public keys will need to be accounted for and administered for these sorts of new assets.
- Anti-money laundering — One worry, at the moment, is that the buying and selling of these digital assets could be a way to disguise or launder dirty money. Although the underlining technology of the blockchain is leveraged, a general misunderstanding of its complexity makes it a temporary safe haven for the scofflaw.
- Tax & accounting — Millions of dollars are being transferred, soon to be billions; and those in the tax & accounting field will need to better understand this space to assist their clients. How are sales treated? What does appreciation impact? And how can we account for the transactions?
NTFs are likely here to stay. They will continue to evolve, however, representing nearly every assets class going forward. Law firms, corporations, tax & accounting firms, and government agencies will need to pay attention to this space in order to account for how this new technology impacts their individual [digital] pictures of the law.
From the producer: Here at The Hearing HQ we’ve really missed travelling. So being whisked (virtually) to Buenos Aires for this week’s episode was a real treat!
Meet Joe’s guest, Federico Ast, the CEO and founder of Kleros. He’s deeply intelligent, thoughtful and one hell of an aggravator in the world of justice. Federico has a philosophy-centered approach to improving judicial systems around the world, and talks to Joe about how deliberative democracy can fast-track access to justice.
Kleros is an online dispute resolution system based on blockchain, crowdsourcing and game theory. We hear how Federico has used his experience of the Argentinian economic collapse of the 90s to problem-solve dispute resolution for the internet age.
From the producer: On The Hearing, we’ve talked to people at the top of their game about their experiences of lockdown. We’ve gained advice from experts on how businesses can best weather these unprecedented times. And this week Joe chats to Karim Sabbidine, an associate at Thompson Hine, about what COVID-19 means when you’re at the legal coalface.
Pre-pandemic, life as a New York litigator was a heady mix of high pressure and excitement – tiring yet fun. But for Karim it quickly transitioned to being cramped in a small apartment with two equally busy flatmates, while trying to navigate a virtual trial.
Karim has an international and multicultural background, and has an enviable résumé of on-the-job training. He talks to Joe about the realities of being a litigator, the benefits of writing every day, and why it’s important to always dress the part.
Published on Lifewire
Written by Michelai Graham – Interview with Joseph Raczynski
Facebook is scaling back its ambitious plans to move into the cryptocurrency sector while users on the platform aren’t showing much confidence in the site’s new addition.
The media giant will likely launch its smaller scale Libra cryptocurrency project as soon as January. Libra was originally supposed to be a new currency backed by fiat money (a currency established as money by the government) and securities (tradable financial assets). Libra will now work as a stable coin, meaning it won’t fluctuate in value as it’s pegged to something like the US dollar or a basket of currencies.
“It was only a matter of time before a private company went down the road of their own cryptocurrency,” Joseph Raczynski, a technologist and futurist for Thomas Reuters told Lifewire in an email. “I was very excited to hear this was going to happen last summer, but skeptical to see how it would transpire.”
What Exactly Is Facebook Trying to Do With Cryptocurrency Anyway?
Cryptocurrency is the private industry’s brand new way to exchange value over the internet, Raczynski said, and Facebook wants to take advantage of that.
Raczynski has been working with cryptocurrency since the creation of Bitcoin in 2011 and has even created his own cryptocurrencies before. He said the most appealing aspect of cryptocurrency is the security and ease of use. Unfortunately, cryptocurrency is still just an idea of the future for some people, which may be a struggle for Facebook as it plans to launch soon.
“At its most basic, cryptocurrency is the representation of value on the Internet,” Raczynski explained. “The first stage that people should be cognizant of is that a cryptocurrency will be similar to a digital dollar.”
“It was only a matter of time before a private company went down the road of their own cryptocurrency.”
Facebook plans to launch a single dollar-backed coin, and eventually a wallet called Novi, to send and receive Libra currencies. Digital wallets are encrypted, Raczynski explained, so only the user would have access to it. With Novi, Facebook users can manage their digital coins within Facebook’s apps, including Messenger, WhatsApp, browsers, and other connected apps. With the use of a single currency, Raczynski thinks it will make the barrier to do things much easier to manage.
“Anyone using Facebook around the world could exchange their local currency for the Facebook currency,” he said. “Anything you want to buy, services rendered, or simply exchanging money could happen across the world with a unified Facebook currency.”
Are Facebook Users Ready for Libra?
With all of the changes to Facebook’s cryptocurrency plans, users may be skeptical of its efficacy, yet the appeal of being able to easily send and receive money digitally may (eventually) trump those doubts. The social media giant is no stranger to discussing privacy, so it better be prepared to talk about its plans to track cryptocurrency usage on its site.
“Facebook is a lightning rod for controversy,” Raczynski said. “What they do or don’t do with users’ personal data and tracking user habits is a constant in the news and most people’s minds. It really is a broadening of what Facebook can do to trace and track habits and data patterns.”
Facebook users are probably already using digital wallets like PayPal and Venmo, and Facebook’s Novi will work similarly to those. What they all have in common is the fact that the platforms own and manage users’ digital wallets.
In the “real” cryptocurrency world, users have full ownership of their digital wallets, which are protected by private keys—a public address to share with anyone to make transactions with and a private one that shouldn’t be shared and essentially makes the wallet yours. So, while your money would still be yours via Facebook’s digital wallet, you don’t “own” the system it runs on.
Another important aspect to note is that while Libra is slightly more decentralized than a country’s own monetary system, like the US dollar, it’s still centralized around a number of companies serving as validators. While it might be a better system to use, according to Raczynski, it’s still susceptible to hacks because there are relatively small sets of attack points.
Why Is This Important?
This new currency Facebook is creating won’t rely on the government, and will instead be backed by an extensive portfolio of companies, including those in the Libra Association.
“They have developed a governance where mega companies run computer nodes/servers that verify transactions between people or companies,” Raczynski said. “Now, in concept, this is similar to what Bitcoin established 11 years ago, only Facebook is run by upwards of 100 companies and their servers, rather than tens of thousands of computers which are not influenced by those private companies.”
In the not-too-distant future, Raczynski said, every asset people have will be represented by a cryptocurrency, from cars to real estate and beyond. This reach could also help people around the world who don’t have access to physical banks.
“Anything you want to buy, services rendered, or simply exchanging money could happen across the world with a unified Facebook currency.”
“There are few things that will be as technologically transformative in the world as cryptocurrency over the next ten years,” said Raczynski. “I am most excited about how it has the potential to help the unbanked, and [help] people living in developing countries rise up and take ownership of their own assets and build wealth.”
Despite Raczynski’s confidence in the growth trajectory of cryptocurrency over the next decade, people will have to learn more about crypto to believe using it on Facebook is a real thing, just as online shopping prompted much skepticism across the world when it first became reality. That, however, is on Facebook to prove.
From the producer: You may have watched as Mark Zuckerberg explained the internet to Congress in a way that felt a bit unnecessary. Well, this episode is sort of the opposite of that. Joe Raczynski is joined by legal and mathematical macroeconomics genius Doug Pepe, to take us through blockchain, tokens and cryptocurrency in a way that’s genuinely enlightening.
The legal industry is sometimes accused of not keeping up, but we know that’s not true. Lawyers are occupying this space now. Their clients are very active and they have a crucial role to play in the serious policy issues being debated.
Doug, a partner at Joseph Hage Aaronson, started his blockchain journey by building gaming computers with his young children, and then teaching them how to mine bitcoin. Fast forward and Doug is now an expert on blockchain privacy, smart contracts and digital identity.
Find out more at tr.com/TheHearing
While the judges deliberated, I gave professors, students, lawyers, and technologists in the UK a glimpse of the technological innovations coming in the near and longer terms and sense of what this could mean for legal advisers.