Many people still view blockchain and the distributed ledger technology that enabled bitcoin and other forms of digital currency as all but impossible to fully comprehend.
Still, it’s an article of faith among believers that blockchain technology will soon revolutionize the world, and a few law firms already have dispatched lawyers to advise companies in this nascent industry on the numerous challenges, which range from whether bitcoin is a property or a currency, accounting and tax treatment and various other issues.
This week, Steptoe Johnson announced it will soon accept payment in bitcoin.
“We’re counseling other companies about accepting the risks and the challenges and opportunities of digital currency,” said Steptoe’s Alan Cohn. “We should really be walking the walk.”
Cohn, an of counsel at the firm and former assistant secretary in the Department of Homeland Security, and Jason Weinstein, a partner and former deputy assistant attorney general launched the firm’s blockchain practice group roughly one year ago. They also launched a blog, about the development of blockchain technology.
Below is a brief transcipt of our conversation with Cohn. It is lightly edited for clarity and concision.
Big Law Business: How many clients pay in bitcoin?
Cohn: This is a new service that we’re providing. We anticipate some clients would take advantage of that.
Big Law Business: Doesn’t the value of bitcoin fluctuate?
Cohn: The firm is not investing in bitcoin as a currency appreciation. We view bitcoin as a currency rather than an investment. It is a mechanism for accepting payment of legal fees.
Big Law Business: So blockchain is really just a financial technology?
Cohn: It’s tempting to think of it solely as a financial technology, but we work with companies that are viewing blockchain as a mechanism for digital rights management and all sorts of non-currency uses. It’s really a cross-cutting issue. There’s certainly a heavy nexus with financial technology, but there’s a nexus with everything else our firm does, too. This is one of the reasons why we very much wanted to expand this practice and bring in expertise from around the firm.
Big Law Business: At what stage of development do you see blockchain and related technologies?
Cohn: We see blockchain as kind of in the same stage as the commercial internet industry was in the early to mid-1990s. There’s a lot of development to come, highs and lows, setbacks — it was left for dead more than once. We’re seeing the growth of technologies that could never have been imagined.
Big Law Business: What’s the next big development for this technology?
Cohn: I think you’ve seen an explosion of interest in blockchain and bitcoin technology across a range of industries. You have them looking at applications both at public blockchain, such as Etherium, and you also have a lot of interest in private or permission blockchain. I think what you’re seeing now is what’s going to be this next phase — companies experimenting with these technologies and looking at where is the biggest impact going to be, how do I take advantage, and how do I adopt the technology.