From Legal Agreements to Blockchain Smart Contracts

Abstract

Complex legal agreements enable many real-world applications, from data sharing systems to financial transactions. However, legal expenses scale with complexity because of the manual processes to draft, revise, and enforce agreements. To reduce such costs, we propose a new framework for lawyers to develop machine readable legal agreements, which are automatically verified and deployed on the Ethereum blockchain. Specifically, our framework introduces domain specific repositories to store human and machine readable legal language, a web interface and Python API to draft legal agreements, correctness checking via formal verification, and a voting system for blockchain based adjudication. Experimental evaluation found that our proposed framework offers an efficient verification system, incurs linear scaling of Ethereum blockchain gas consumption in terms of agreement size, and correctly models 81% of conditions in real-world agreements through the domain specific repositories. These results suggest a practical approach for developing verifiable and blockchain compatible legal agreements.