As part of a new series, The Legal Chain spoke with Nathan Vandy, an in-house lawyer at an exciting German blockchain start-up: Blockchain HELIX. Thank you to Nathan for allowing us to interview him!
What attracted you to become a lawyer at a blockchain start-up?
The opportunity to work in an industry where everyone is developing the semantics, the technology, the use cases and implementation - all at the same time - was too exciting to miss out on. Blockchain technology itself is so interdisciplinary. The first prominent use case of blockchain, Bitcoin, intersects between technology, game theory, finance and law… just to name a few. This makes it very exciting. It’s a very young industry, with blockchain technology only being twelve years old. This makes it difficult for companies trying to understand how their use cases fit in with the laws and regulations that couldn't even conceive decentralised technologies. Although there are definitive steps towards better legal and regulatory guidance in the form of legal acts from Lichtenstein and more recently Switzerland, there are still so many open legal questions from the liability of participants on a permissionless ledger to the legal enforceability of smart contracts. Being a lawyer in a blockchain start-up allows you to create clarity in an industry which due to its innovation also comes with a high level of uncertainty. This means constantly learning and sharing your learnings. I guess that’s the open-source approach, and that’s what truly attracted me to work in a blockchain start-up.
What does your work involve on a day-to-day basis?
On a day-to-day basis… that’s a tough question. It might be cliche but truly no days are the same, especially in a start-up. Working as in-house counsel already requires acting as a business partner to deeply understand the business model and roadmap. From there you can create your own legal roadmap that sits aligned. My days, therefore, typically revolve around developing the commercial documents for our different use cases and also amending them for individual clients. Leading Legal and Compliance in a company does mean that you cover a wide range of matters. From legal reviewing and drafting commercial agreements between clients and technology partners to building e-KYC frameworks in highly regulated industries. I also get to work with the marketing team and host events on interesting topics in the law and technology space. It’s great for sharing knowledge on innovative topics. For example, our last one was on how blockchain companies are dealing with the not being able to delete personal data on blockchains dilemma. It exposes you to the fantastic work that other individuals and companies are doing in the space.
What have been the most interesting developments that you have advised on?
I’ve had the privilege of being part of INATBA (International Association for Trusted Blockchain Applications) and building up quite a bit of research material. Primarily, I’ve been focused on looking at the application of blockchain technology in Identity where I helped produce the Position Paper, Decentralised Identity: What’s at Stake. It was also great to be involved in a research project that looked at the global data protection regulations that affected blockchain technology. It gave such a strong insight into how blockchain is being adopted and understood across different jurisdictions. Also… the intersection between law and governance has always been a strong research point and interest of mine. And so a big highlight for me, was the opportunity to work alongside talented lawyers in drafting legal and governance documents for a permissioned blockchain.
Do you think that increased regulation will limit innovation in the blockchain and cryptocurrency industry?
Honestly, regulation can increase clarity and confidence into an industry which encourages investment and increased use cases. This is what we are seeing with the development of the MiCAR regulation which is harmonising the European framework for the issuance and trading of various crypto tokens. Additionally, it is being developed in public consultation which ensures that it takes a wide perspective. On the other hand, excessive or misplaced regulation can also hinder innovation. An example would be the European Parliament’s proposal to request certain platforms to introduce compulsory backdoor to their encryption. This would reduce the effectiveness and security of blockchain technology meaning that people would adopt other technologies or worse move to other areas where there is less/no regulation. Additionally, it’s important to mention that blockchain platforms that are permissionless, where there is no central authority which maintains the network, are very difficult to regulate. On the other hand, permissioned blockchains make it easier to identify the individuals involved and make them accountable. This is the area that most regulators are indeed putting their focus on. Initially.
How did 2020 affect your practice?
The skill of being flexible became essential. We had to accommodate varying demand in clients, shifting roadmaps, and dealing with the lack of in-person contact. This is difficult on an emotional level but also operationally. In a start-up, it’s easy to have informal, quick meetings about a stress point, in-person. The loss of these moments meant that the entire team had to adjust how we communicated. The emphasis on weekly stand-ups, impromptu calls and Slack (an absolute life saver) definitely helped to maintain the level of communication needed to manage and complete projects interdependently. To be honest, 2020 made me appreciate my privilege. Many people weren’t able to keep their jobs during last year, so I’m very grateful to have a great team and job regardless of the challenges.
What advice would you give to any aspiring lawyers interested in working with blockchain technology?
Good question. I would definitely encourage you to continuously study about what the technology is (it’s constantly evolving - just look at Decentralised Finance) and understand the different use cases. For example at Blockchain HELIX, we are using blockchain technology to allow users to onboard online without the need to constantly send personal documents and data to verify themselves. This is different from a company that is using blockchain to develop non-fungible tokens to represent unique artwork. By understanding the different use cases, you can find the areas that interest you and the companies you might want to approach for a job position. On the legal side, a strong understanding and affinity of IT/IP law is helpful. Nooone expects you to be a coder. But the ability to draft and review vendor agreements, understand the intellectual property rights of open source code, and manage commercial relationships is vital. Lastly, you will be dealing with data across many jurisdictions, so brush up on your data protection knowledge. If you’re not looking to go down the in-house route and work at a blockchain start-up, make sure that you research the different projects of any law firm that you are applying to. More than often these days, they will have a Fintech/Blockchain practice. Apply, shoot your shot, and you might just be lucky enough to have an interviewer as passionate about the technology as much you are. Best of luck.
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