McCarthy Tétrault and OpenLaw collaborate on loan agreement smart contract project powered by Ethereum blockchain
Toronto, July 17, 2018 — McCarthy Tétrault has teamed up with OpenLaw to automate key aspects of the lending process by leveraging smart contract powered loan agreements on the Ethereum blockchain.
Earlier this year McCarthy Tétrault announced its membership with the Enterprise Ethereum Alliance (EEA), the world’s largest open source blockchain initiative and the EEA Legal Working Group, founded to bring together leading global law firms and leading legal minds to explore building legal use cases and applications using blockchain technology. In addition, McCarthy Tétrault became a contributor to the OpenLaw smart contract project.
These collaborations have yielded groundbreaking results, providing the first step in demonstrating how automation and execution of loan agreements on the blockchain can vastly improve processes. This demo illustrates how a standard loan agreement can be executed using the OpenLaw protocol and an Ethereum smart contract. It also shows how a traditional loan transaction, through the use of an Ethereum-based smart contract, can be performed without the need to rely on centralized institutions to calculate and manage the actual flow of funds between parties. This is believed to be the first smart contract demo by a Canadian law firm.
“Blockchain technology is poised to transform lending in so many ways,” said Ana Badour, Partner and Leader, McCarthy Tétrault Fintech Group. “McCarthy Tétrault is excited to be at the forefront of these developments; investing in blockchain technology and smart contracts is an investment in the success of our clients and in our deep commitment to always provide leading-edge services.”
“We believe it is essential that we as lawyers are deeply involved in the evolution of this technology as it continues to develop and transform the industry,” said Ian Mak, Partner, McCarthy Tétrault Financial Services Group.
OpenLaw is a blockchain-based protocol for the creation and execution of legal agreements. Using OpenLaw, lawyers can more efficiently engage in transactional work, all while leveraging next generation blockchain-based smart contracts.
McCarthy Tétrault’s Fintech Group was last year awarded the ‘Law or Professional Service of the Year’ award at the Canadian Fintech & AI Awards. OpenLaw and McCarthy Tétrault will continue to iterate on this use case, develop the OpenLaw’s protocol and begin to experiment with more involved loan agreements. For more information, read OpenLaw’s article on blockchain-based lending here.
About McCarthy Tétrault
McCarthy Tétrault LLP provides a broad range of legal services, advising on large and complex assignments for Canadian and international interests. The firm has substantial presence in Canada’s major commercial centres as well as in New York City and London, UK.
Built on an integrated approach to the practice of law and delivery of innovative client services, the firm brings its legal talent, industry insight and practice experience to help clients achieve the results that are important to them.