One of the biggest risks to accepting virtual currency is as it relates to Model Rule 1.15 – Safeguarding Client Property. In other words, this means that once a transaction occurs, it is added onto the previous transaction, and then remains on the network forever. ![]() Virtual currency operates in much the same way.Įvery transaction occurring on the network is stored in “blocks,” which cannot be altered or changed once created. The key would be known only to the General receiving the message, and thus, even if the message was captured, its contents would be undecipherable. This was accomplished by using an alphabetic shift in letters, so that the number “2” meant that the letter “a” would shift two letters to the letter “c,” and so on. Musiala, Baker Hostetler’s Blockchain Counsel, analogizes this concept to an ancient Roman technique created by Julius Caesar: during war, Caesar was able to send public, but encrypted, messages to his Generals. This provides a certain degree of security, and ensures that one person or entity cannot control the network.Īdditionally, the integrity of the information stored on the network is secured by public and private cryptography (“keys”). The network operates as a hive-mind, so that if one node fails, the other nodes continue without interruption. In short, Bitcoin is the combination of a virtual currency and a public ledger with enhanced security features, known as “Blockchain.”īlockchain is a database consisting of a distributed network of computer (“nodes”) that each work to verify updates to the database. The idea of Bitcoin was published in a 2008 white paper describing a currency that was both public and anonymous, which could not be manipulated (or printed) by people. Before diving into how Bitcoin works, it is important to understand where Bitcoin comes from. This article will cover a brief history of Bitcoin, the technology and main concepts underlying Bitcoin, and the ethics and logistics of accepting it as payment for legal fees. ![]() As Bitcoin becomes more widely adopted by customers and businesses, it has already begun to make its way into the legal profession prompting an important inquiry: can lawyers accept Bitcoin as payment for legal fees? Although the price of Bitcoin is extremely volatile day-to-day, the virtual currency has held onto most of the value it has gained over the years. While it began its journey as an obscure financial technology, in a little over a decade, Bitcoin has revolutionized financial technology and security, while capturing global headlines.
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