# Automated Contract Processing with Smart Contracts

> 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.

**Sector:** Tertiary sector · **Industry:** Legal services and law firms · **Organisation:** OpenLaw · **Maturity level:** Production

Canonical URL: https://www.sapientblock.com/en/use-cases/openlaw-vertraege-automatisch-sicher-ausfuehren

## 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.

## Benefits

- Companies can reduce their contract management costs while increasing processing speed.
- 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.
- Legal experts can focus on complex and strategic tasks while routine activities are automated.

## Challenges

- Integration into existing legal systems and acceptance by traditional lawyers can cause significant resistance.
- 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.
- 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.

## Sources

- [Smart Contracts: Vertrag auf der Blockchain](https://blockchainwelt.de/smart-contracts-vertrag-blockchain/)
- [OpenLaw Launches New Smart Contract Platform on Ethereum](https://www.artificiallawyer.com/2017/07/31/openlaw-launches-new-smart-contract-platform-on-ethereum/)
- [Blockchains, Smart Contracts and OpenLaw](https://www.uni.lu/wp-content/uploads/sites/3/2024/08/Wright_Blockchains-Smart-Contracts-and-OpenLaw.pdf)