Victoria Hudgins: Booming Blockchain Usage Could Become E-Discovery’s Kryptonite

Extract from Victoria Hudgins’s article “Booming Blockchain Usage Could Become E-Discovery’s Kryptonite”

Blockchain-based assets such as cryptocurrencies and non-fungible tokens (NFTs) are cropping up with broad usage among individuals and organizations. But when those digital assets finally land in a courtroom, they could bring a host of difficulties to e-discovery practitioners. 

E-discovery software, for instance, can’t easily render blockchain transactions, said Patrick Burke, former New York State Department of Financial Services deputy superintendent and current partner and chair of Phillips Nizer’s data technology and cybersecurity group. “The challenge of doing e-discovery on blockchain transactions is that, while there are tools to track cryptocurrency and other blockchain activities, they often don’t translate well to evidence you can view on an e-discovery platform,” he noted.

Still, Eric Mandel, a lawyer and consultant for e-discovery tech provider Driven Inc., argued that while translating blockchain data to something more readable on e-discovery tools is a challenge, reviewing the data is still possible. He noted that blockchain presents the same challenges previously faced by litigators analyzing extensive financial documents.

“It’s much more similar to financial data,” Mandel said. “If you think about what you have to do to prove that someone owes some money, [blockchain] is a transaction log. For all of us that had to deal with evidence from the financial system that is in databases, it’s much more akin to that.”

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