Smart Contracts: Role of Counsel, Best Practices for Limiting Vulnerabilities

Description

While smart contracts have the potential to revolutionize business transactions, vulnerabilities in the operational accuracy and security of the underlying code pose a substantial risk for companies deploying the technology. Similar to traditional software, programming errors can result in all manner of unintended consequences. Even if the code works as intended, hackers' theft of over $1 billion in virtual currency since 2016 demonstrates the magnitude of the potential loss from security threats.

Capable practitioners add value to their clients during the planning, drafting, and implementation of traditional contracts governing the use of smart contracts and other blockchain enabled software. In smart contracts, counsel must understand the full range of contingencies and outcomes available with a software product that operates on a blockchain and prepare to expand their usual advisory role to address these issues.

Attorneys must also be prepared to lend insight during the software development process by identifying and correcting business or regulatory issues commonly raised before deployment of smart contracts and tailor remedies that encourage non-pecuniary resolution once a hacker exploits a vulnerability or a customer raises a dispute.

Listen as our authoritative panel discusses how corporate and deal counsel can expand their responsibilities and add value to clients deploying this expanding technology, along with some critical considerations during the planning, drafting, and implementation phases of the software coding.