Automated Contract Processing with Smart Contracts
Sector: Tertiary sector · Industry: Legal services and law firms · Organisation: OpenLaw · Maturity level: Production
OpenLaw develops a platform on the Ethereum blockchain that enables lawyers to create legally binding and self-executing contracts and process them automatically. The platform was launched in July 2017 and uses a special markup language to convert traditional contracts into executable smart contract objects. This aims to improve time-consuming and error-prone traditional contract processing through automation.
Documentation status
- Project status: Production
- Evidence: Evidence high
- Editorial review: Ufuk Avci, 15 April 2026
Description
OpenLaw was founded in 2017 with the aim of combining legally binding contracts with smart contract execution. Artificial Lawyer reported in July 2017 on the launch of the platform on Ethereum. In 2018, OpenLaw was acquired by ConsenSys.
The problem with smart contracts: pure code contracts are difficult for courts to interpret and cannot cover all eventualities that legal thinking requires. The problem with conventional contracts: they are legally precise but manual in execution. OpenLaw solves this contradiction through hybrid contracts: the lawyer writes the contract text in normal legal language; OpenLaw tags mark certain clauses as automatically executable; a backend system generates the corresponding Ethereum smart contract. When the conditions are met (e.g. delivery confirmation), the smart contract automatically triggers payment. Templates: rental agreements, purchase contracts, service contracts, freelancer agreements, investment SAFEs. Blockchainwelt analysed smart contracts as a new form of contract. University of Luxembourg (Aaron Wright, co-founder of OpenLaw) published an extensive study in 2024 on blockchains, smart contracts and OpenLaw as an academic reference work.
Perspectives
B2B — organisations perspective
Law firms and companies can equip standard contracts with automatic execution logic using OpenLaw: payments, deadlines and conditions are executed blockchain-based without manual intervention.
B2C — consumers perspective
End customers could benefit from standardised and more cost-effective legal services if smart contract-based solutions become available for simple contract types. However, the direct consumer benefit is currently still limited.
Employees perspective
Lawyers and contract managers can focus on strategic and advisory activities while routine tasks are automated. At the same time, however, they need to acquire new technical skills in blockchain and smart contract development.
Benefits
General
- The automation of contracts reduces human errors and significantly accelerates processing.
- Transparency and traceability of contract executions are ensured by blockchain technology.
- Cost reduction in contract processing through fewer manual steps and administrative tasks.
B2B — organisations
- Companies can reduce their contract management costs while increasing processing speed.
Employees
- Legal experts can focus on complex and strategic tasks while routine activities are automated.
Challenges
General
- The legal validation and enforceability of smart contracts in different jurisdictions remains a complex challenge.
- High technical complexity requires specialised developers and comprehensive training for legal experts.
B2B — organisations
- Integration into existing legal systems and acceptance by traditional lawyers can cause significant resistance.
Employees
- Lawyers must acquire new technical skills and fundamentally adapt their way of working.
Technology foundation
The platform uses the Ethereum blockchain as a technical basis to store and execute smart contracts. A specialised markup language converts conventional contracts into programmable objects that can be executed automatically and integrated into existing systems via APIs.
Implementation examples
OpenLaw Smart Contract Platform Launch
The company wanted to modernise the time-consuming, inefficient and error-prone traditional contract processing. Issues such as decentralised email-based storage and human errors in contract activation were to be solved through blockchain automation.
OpenLaw developed and launched a smart contract platform on Ethereum for automated contract processing in the legal sector.
OpenLaw was developed by Aaron Wright and David Roon with support from the blockchain company ConsenSys and launched in July 2017 as a smart contract platform on the Ethereum blockchain. The platform uses a specialised markup language to convert traditional contracts into executable smart contract objects. The system stores contract states, electronic signatures and executes automated contract performance on the Ethereum blockchain.
The solution addresses slow and insecure traditional contract processes through automated smart contract execution. Manual sources of error are eliminated by programmable contract logic.
Tags
Smart Contracts, Legal Tech, Contract Automation, Ethereum, Digitalisation