A well-known industry site Law.com says more and more lawyers are opting to receive payment in cryptocurrencies to land the growing number of businesses in the cryptocurrency markets.
Some practitioners are accepting payments even if it goes against their natural propensities toward risk aversion, to show clients that they are investing in what they are building. Bitcoin payments could be worthwhile for many others given the massive increase in the price last year.
The fact that the client is dealing with cryptocurrencies means it is easier for the lawyers to get paid in it and get more rapid payment, Carol Van Cleef, a Washington, D.C. lawyer who for ten years has representing cryptocurrency clients with regulatory compliance told Law.com
This is to follow steps of international firms such as Perkins Coie that has been accepting Bitcoin payments since 2013. Other leaders in this trend include Steptoe & Johnson and Frost Brown Todd.
But not many lawyers are happy or would be comfortable with it, mainly because of volatility in prices.
Van Cleef said,
“Lawyers are typically very risk averse and tend to be on the side of certainty. So I think that’s probably one of the biggest issues for them in accepting bitcoin as a fee. How do you price it? When do you price it? How do you ensure you’re minimizing any downside risk in a volatile trading market?”
Some can hold it to cash it out later, one way a lawyer can handle volatility is cashing out the cryptocurrency as soon as he is paid, before the price swings.
“We cash it out when it comes in, because of the volatility,” Houston criminal-defense solo Jay Cohen, who began accepting bitcoin payments in 2013, told Law.com.
Cohen said Bitcoin and cryptocurrencies help as a payment method because sometimes families of some clients charged with a crime might not want them to pay legal bills out of the family’s budget. They have to use an alternative.
But again, usage of Bitcoin as a payment method is affecting by lengthy transaction times on the Bitcoin network. That affects usage among many clients and lawyers.
Another barrier is legal ethics issues because of the problem of tracing the Bitcoin to ensure it has been acquired legally by the client. Cohen sometimes back turned down a request from a client who wanted to pay in Bitcoin. Although, when he realized that the case involved money laundering with Bitcoin.
“I like the anonymity of it, but at the same time. I had to decline to represent people who wants to do it because I don’t want to be investigating by anyone”.
However, it is hard to get insider information about the legality of Bitcoin or other cryptocurrencies. Kathryn Haun is a former assistant U.S. attorney in San Francisco who has prosecuted and convicted criminals who used Bitcoin. He says there is no reason for anyone to believe that cryptocurrency is illegitimate and criminally-derived. However in any more than any other form of currency or payment.
The other barrier is that technology in handling Bitcoin and cryptocurrencies. But lawyers can usually find technical support from companies that offer digital currency exchange and payment processing services.