A Nebraska ethics board just granted attorney’s permission to accept bitcoin, with a few stipulations. The Lawyers Advisory Committee granted approval, and also suggested accepting bitcoin is not at odds with codes of professionalism.
The Advisory committee represents an 8-person organization that makes conduct decisions for attorneys in Nebraska. The State of Nebraska Judicial Branch further clarified their role: “The eight members of the Lawyers’ Advisory Committee are attorneys appointed by the Nebraska Supreme Court. Each Supreme Court Judicial District is represented on the Committee and the chairperson and vice chairperson are selected at large.”
Bitcoin Acceptance Rules for Nebraska Lawyers
On the Nebraska Ethics Advisory Opinion For Lawyers document, 3 different questions were presented before the board. Each question pertained to attorney’s accepting bitcoin for client services:
A. May an attorney receive digital currencies such as bitcoin as payment for legal
B. May an attorney receive digital currencies from third parties as payment for the
benefit of a client’s account?
C. May an attorney hold digital currencies in trust or escrow for clients?
Board Decisions on the Questions
For A, the board agreed that Nebraska attorneys should be able to receive bitcoin as a form of payment. However, they have to immediately turn the bitcoin into fiat currency. The document stated that a rise in price would be an “unconscionable overpayment.”
For B, Attorneys can receive funds from third parties so long as the payment prevents possible interference with the attorney’s independent relationship with the client and the attorney implements know-your-client (“KYC”) procedures within the transaction.
For C, the board approved attorneys could hold hold funds in escrow. However, the attorney cannot mix bitcoin with their property. They are supposed to use multi-sig wallets for holding bitcoin for escrow.
Bitcoin Statement of Facts
The original document concluded with some facts about bitcoin. It talked about what bitcoin is and how it works, and mentioned it was a decentralized, peer-2-peer payment network and digital currency. It even went into details about wallets. The document further elaborated:
A person sending bitcoins to another person uses a “public key”, a series of letters and numbers comprising the address to where the funds should be sent. The sender then utilizes a “private key”, a code that authorizes the ledger book to make a change that debits the sender’s wallet and credits the receiver’s wallet.
The Advisory Board document also said a number of law firms and “jurisdictions” have began accepting bitcoin, but they probably have not determined if it is “allowed through their respective Bar Associations’ Codes of Conduct.”
What do you think about Nebraska allowing attorneys to accept bitcoin? Is this a step in the right direction? Let us know in the comments below.
Images via Shutterstock
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