Technology can be used as evidence in legal proceedings.
On this journey to mass adoption and acceptance, blockchain has come a long way. We now have applications in banking, supply chain, real estate, fine art, insurance and many others. Throughout the last two years we have had many industry initiations and the legitimacy of the technology is growing. In 2017 and 2018 we have seen heavyweights such as IBM begin to partner with established cryptocurrency projects, and even old school companies founded decades ago (1888 to be exact), like De Beers Diamonds, are now using blockchain to track the flow of their products. One of the more interesting cases for blockchain is in the legal arena. Intuitively it makes sense, an unalterable record, secured by blockchain, should have some value and use in legal proceedings, but would a court uphold the evidence given that it’s such a new technology? Thanks to a court ruling in China we now have some answers and legal precedent. The court in Hangzhoui city, China determined that evidence authenticated by blockchain can be used in legal disputes.
Which blockchain was used to secure the evidence? Factom!
A Chinese based media company filed a lawsuit against a technology company for copyright infringement and unauthorized use of its materials. The media company showed images and text during the legal proceedings that they believed were used without authorization.
The media company had used a blockchain-based evidence platform from Boaquan that hashed the material in question and stored it in a distributed ledger, thereby making it simple to prove history and initial ownership.
The court ruled in the plaintiff’s favor and had this to say regarding blockchain technology:
“The court thinks it should maintain an open and neutral stance on using blockchain to analyze individual cases. We can’t exclude it just because it’s a complex technology. Nor can we lower the standard just because it is tamper-proof and traceable. In this case, the usage of a third-party blockchain platform that is reliable without conflict of interests provides the legal ground for proving the intellectual infringement.”
This decision and ruling has marked an important milestone for blockchain and Factom. It has resulted in a legal precedent and determined that the technology can be used as evidence in legal proceedings. While several articles have been written regarding this case, Factom’s role has gone somewhat unnoticed. Let’s delve in and briefly examine how Factom was involved.
Factom employees in China were instrumental in providing technical support for the case
According to Paul Snow, Factom’s involvement was downplayed by some of the reporting websites, it was Factom’s employees in China that were instrumental in providing technical support for the case.
CoinDesk is downplaying Factom here, but the hashes were in Factom which anchors into Bitcoin. Our people in China helped provide technical support in this case!
— Paul Snow (@paulsnx2) June 29, 2018
The platform used by the media company was Baoquan, which operates under Shuqin Technology and has a history with Factom dating back to 2016. Both companies previously reached a strategic cooperation agreement with the intention of jointly promoting the development of blockchain technology. According to an October 2017 report by Forrester: Baoquan is a data attestation platform using public blockchains and has three frameworks for their infrastructure platform: Factom, Bitcoin, and Hyperledger. While the court made references to Baoquan using Bitcoin and Factom to hash the content, it’s necessary to deconstruct the situation to better understand Factom’s role. Baoquan requires hundreds of thousands of transactions, Bitcoin’s technology – limited to seven transactions per second – cannot meet this demand and presents a technology gap. Factom was invented to address this limitation and takes advantage of bitcoin’s security without bloating the network.
Paul Snow stated that the hashes for the media company’s content was in fact stored in Factom, which then anchors into the Bitcoin blockchain as an added security redundancy. This is an important point to grasp, since Factom’s technology was instrumental in this case. Factom is blockchain agnostic and can anchor into any network, such as Ethereum, thereby providing multiple options for securing data.
What’s does this mean now for proof of legal documents using blockchain and more specifically Factom?
“My goal in creating the Factom protocol was to provide a trusted data layer because I believe honesty in business and government begins with trust of the underlying data. A Chinese court in accepting, as valid and trustworthy, evidence stored on the Factom blockchain is confirmation of my goals. This has always been about more than just bits stored on a hard drive. It’s been about making those bits trustworthy.” said Paul Snow, Factom CEO
We are certainly living in exciting times and this legal ruling is just one step of many on the road to mainstream adoption of the Factom protocol. Factom’s technology is paving the way in several industries and is one of the few examples of a practical working blockchain-based solution in the crypto space. With this legal precedent, a whole new dynamic emerges that may allow The Factom protocol and it’s community to see some very interesting cases.