The Lex Automagica Project Explained

  • We Need A New Technology Platform to Truly Scale Justice.
  • Maybe Blockchain and Smart Contracts Are The Answer.
  • Let’s Find Out By Trying To Build Real Solutions to Real Problems.

Many people have predicted – even hoped – technology would upend the legal system and traditional law firms, and so improve the law and enhance access to justice. Yet, despite incredible dynamism, legal technology has not fundamentally changed lawyers or the law. New business models have arisen. New tools for doing legal work have been invented. But to the average person, the justice system is as frustrating, expensive, byzantine, and inaccessible as ever.

“Pen, Paper, People” Trumps Machines When Making Rights

This is not because the law or lawyers are too traditional or conservative to change. Law is an almost perfectly competitive industry. If there is a technological advantage over their rivals, law firms will seek it. The truth is the old technology platform of “pen, paper, people” is so ideally suited to its task – to the intersubjective nature of the law – that no modern technology suite has been sufficiently useful to replace it.

Using pen and paper and a shared understanding of words between people, it is trivially easy to create and amend a vast array of rights and obligations. The process is flexible, decentralised, inexpensive, inclusive, and human(e). It easily out-competes the time and investment required to make machines do similar work.

But The “Pen, Paper, People” Platform Is Struggling to Scale

But intersubjective rights and obligations are only part of the equation. There must also be real world outcomes. Unfortunately, the public institutions – the courts, regulators, police, bureaucrats, accountants, and law firms – that are supposed to marry these intersubjective rights to objective, practical outcomes are struggling to scale.

Rights and obligations have become unknown and unknowable, ignored and abandoned, unenforced and unenforceable. More rights, more apps, more “NewLaw” cannot solve this problem. We need a new technology platform for the legal system, one that interoperates with the traditional “pen, paper, people” platform so justice can scale. 

Can Blockchain and Smart Contracts (Finally) Scale Justice?

Lex Automagica explores whether technologies like blockchain, digital assets, smart contracts, and AI may become this new platform. These technologies have the potential to be open-sourced, permissionless, decentralised, and interoperable in just the right way to help scale our justice system, and so ensure rights are more effectively married to real-world outcomes. 

Many People Certainly Think So

The law may seem too complicated a thing to be automated through blockchain and smart contracts, but at heart it has just four simple components: People, Things, Relationships, and Dispute Resolution.

  • People: the entities the legal system recognises as legal actors. Individuals, corporations, the State, and increasingly likely, AI-powered machines.
  • Things: the things the legal system recognises with which people can have relationships. It includes money, property, shares, and, increasingly, forms of data.
  • Relationships: the definitions, rights, and obligations that govern the relationships between people and people, and people and things. 
  • Disputes: mechanisms for resolving the inevitable disputes about the existence of people, the existence of things and existence and meaning of the relationships people have between other people and things.
Figure 1 – Elements of “the Law”

In all these areas, blockchain projects are trying to automate what has otherwise been the province of the state. People are working on ways of recognising identity without state-supplied identity or without any identity at all. Projects are trying to tokenise money and assets without state-backed registries. People are trying to automate relationships and dispute resolution, and so avoid reliance on large corporations and failed public institutions. 

Figure 2 – Blockchain Projects by Legal Element

How We Plan to Proceed

So private citizens are already using these technologies to re-tool their legal rights and relationships. Is it a fad, a future graveyard of failed projects? Is it real and transformative? Is it time for governments to lend a hand, mostly (probably) by getting out of the way? We want to uncover the answers, project-by-project.

We plan to pick an area where there is legal friction – where the cost in terms of time, money, risk, and intellectual effort of creating, recognising, discharging, and enforcing rights and obligations is seemingly prohibitive – and investigate whether the Lex Automagica tech suite can provide a better system to marry intersubjective rights to real world outcomes. Sometimes we will produce working code, sometimes just a white paper. The vision is to progressively develop a blueprint for an ecosystem of new institutions to replace or augment those that are a failing.

Figure 3 – Vision of Blockchain-Enabled Justice Ecosystem

Next Steps

As our first project, we will tackle the problem of digital identity. In any system of legal rights, it is important to determine the legal actors, the people with the rights and obligations. The Australian Government has identified Digital Identity and KYC as a national priority for blockchain innovation in its National Blockchain Roadmap. So, we plan to investigate a Self-KYC solution, one that lets individuals request verification of their identity and then tokenises the verification in a way that financial institutions can rely on. 

Want to Be Involved?

We want to solve real problems. If you have a project suggestion, or a problem you think you want solved through blockchain and smart contracts, get in touch.

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