From paper to blockchain: enhancing financial legal agreements through a decentralised application

Abstract

This paper presents the design and implementation of a decentralised application (DApp) that bridges the gap between traditional financial legal agreements and blockchain technology. Leveraging the Ethereum network, the solution introduces a smart contract library that standardises and encapsulates the core financial logic of agreements, facilitating the translation of complex legal contracts into automated, enforceable smart contracts. The architecture adopts a factory pattern and utilises a modular library, enabling the deployment of individual contract instances that incorporate the integrated core financial logic. Additionally, a user-friendly web interface is developed to ensure accessibility for legal professionals with limited coding expertise, thereby democratising the creation and deployment of smart contracts. The research further examines the legal implications of on-chain contract execution, addressing the challenges of approximating real-world legal concepts, such as receipt and acknowledgment, within a blockchain environment. The paper's findings indicate that while practical challenges remain, the proposed DApp lays a solid foundation for the digital transformation of legal contracts, promising enhanced efficiency, standardised legal validity, and a significant step toward the future of automated legal agreements.