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Autonomous Legal Applications Could be Coming to the XRPL

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Back in 2020, I covered an interview with Scott Chamberlain, an entrepreneurial fellow at the Australian National University College of Law (ANU). With funding from Ripple’s University Blockchain Research Initiative (UBRI), ANU launched two courses exploring legal issues with the application of blockchain technology such as smart contracts and the integration of artificial intelligence into a blockchain-based extensible legal framework.

Chamberlain first became interested in Ripple with an eye to the application of legal apps for Codius (Ripple’s previous smart contract framework). For those who don’t remember, UBRI is a wing of Ripple’s charitable works that offers funding and technical expertise to universities around the world as they develop courses and research programs focused on blockchain-based technological innovations.

Ripple caught a lot of flak for these investments, which were framed as dumping XRP onto the market to fund peculiar pet projects at the expense of the value of the XRP token. Even the SEC lawsuit referred to Ripple’s promotional operations, framing them as selling discounted XRP tokens in exchange for the brief advertising benefit of prominent partners using the XRPL. Now, however, one of these investments may bear fruit.

Scott Chamberlain recently published the white paper for a layer 2 smart contract network called Evernode, which plans to plug into the XRPL using hooks. According to the Xumm blog, hooks are “small, efficient pieces of code being defined on an XRPL account, allowing logic to be executed before and/or after XRPL transactions.”

The Evernode whitepaper indicates that the XRP Ledger offers several advantages over rival blockchain smart contract platforms, including the low cost of transactions, speed, security, and a native on-chain decentralized exchange. Early smart contract platforms wouldn’t be suitable for autonomous legal dApps because “lack of scaling inevitably means centralised “off-chain” computation or storage for what is otherwise a decentralised system.” In previous interviews about decentralized legal dApps, Chamberlain described a Lex Automagica Tech stack:

I’m looking at what I call the ‘Lex Automagica Tech Stack’ – blockchain, plus digital assets, plus smart contracts, plus A.I. (Artificial Intelligence), plus A.R. and V.R. (Augmented Reality and Virtual Reality – that can power our societies like clockwork.

Also on the Lex Automagica website is the white paper for an application called iXRPL, which is an identity verification system native to the XRP Ledger akin to the GlobaliD app. It features end-to-end encryption of user identity documents and a permissioned identity verification service for third-party document requests like KYC/AML. A smart contract that required KYC/AML verification would request documents from a user with a verified account on the XRPL. The user would then have to confirm the request before the documents were shared.

In this clockwork society, smart contracts and dApps would fuse elements of the blockchain and legal field into a series of decentralized autonomous legal frameworks. Laws that could be turned into a smart contract would be codified and integrated into our judicial and government frameworks.

As Chamberlain indicated in a previous article, these legal smart contracts could eliminate the prospect of cheating in certain fields. Removed from the subjective and qualitative elements of judicial administration, these smart contracts would provide an unbiased interpretation of the law. Commercial smart contracts can then use existing compliance code to enforce legal behavior within their business activities.

When Ripple announced the UBRI grant, it seemed to be simple charity. Back then, Codius had been widely considered abandoned, and it seemed that the Lex Automagica framework could only be built on a rival blockchain. However, it seems like Chamberlain’s vision for a blockchain-based legal framework is instead going to run on the XRPL via hooks. A system like this could power everything from elections to the collection of taxes and the enforcement of financial/legal responsibilities without centralized intermediaries. Smart contracts could even enforce certain legal obligations between nation-states. If a business were contemplating blockchain adoption, the presence of legal dApps that seamlessly interact with the XRPL would undoubtedly be attractive because functional cross-jurisdictional regulatory compliance would be far more convenient and cost-effective than what currently exists on rival blockchains.

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