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SRA warns law firms on taking payments in crypto

03 Feb 2023 / technology Print

SRA warns law firms on taking payments in crypto

The body that regulates the solicitors’ profession in England and Wales has warned firms taking payments in crypto-currency that they could find themselves in breach of its rules on accounts.

The Law Society Gazette of England and Wales says that the warning from the Solicitors Regulation Authority (SRA) appears in a report on the risks posed by crypto-currencies and other distributed-ledger technologies, and the impact they may have on the legal-services sector.

The report notes that some firms are using blockchain technologies to improve delivery, while HM Land Registry is among the organisations adopting them as standard practice.

So-called smart contracts “have the potential to greatly speed up many legal transactions,” the SRA suggests.

Client accounts

On fee payments, however, the report reminds practitioners that money held on account must be held in a bank or building-society account.

“As there are no compliant client accounts for crypto assets offered by banks or building societies at present, payment for services in crypto assets will only be possible after the services have been provided or as a fixed fee,” the regulator says.

The SRA also warns that the “highly volatile” nature of crypto assets could create difficulties with price-transparency requirements.

The Gazette says that, overall, the report is upbeat about the potential of crypto technologies.

Paul Philip (SRA chief executive) said: ‘Some firms are at the front of the queue when it comes to adopting new ways of working, while others need to be aware of what’s happening so they can properly support their clients and manage the impact on their business.”

Gazette Desk
Gazette.ie is the daily legal news site of the Law Society of Ireland