Lawyers in Nebraska can now accept cryptocurrency as payment, according to a new advisory opinion published by an ethics committee appointed by the state’s supreme court.
The Lawyers’ Advisory Committee is an eight-member body that responds to queries from lawyers in Nebraska, weighing them against the state’s Rules of Professional Conduct. The opinion itself is novel, constituting the first time that a state ethics body has considered a question related to cryptocurrency payments.
According to the advisory, dated September 11, the request focused on three elements: whether an attorney can receive cryptocurrencies like bitcoin as payment; whether directly from a client or from a third party; and whether they can hold cryptocurrencies in escrow or trust on behalf of the client. The answer, the document outlines, is largely yes – with some caveats.
Citing a requirement that no client may be charged too high a fee, the committee said that, while a lawyer may accept a cryptocurrency, it must immediately be converted to U.S. dollars.
This, the committee argued, would “mitigate the risk of volatility and possible unconscionable overpayment for services.”
For third-party payments, the opinion stipulates that they can be accepted “so long as the payment prevents possible interference with the attorney’s independent relationship with the client.” Further, the lawyer must identify the party sending the payment.
The Advisory Committee gave its approval to the question on holding cryptocurrencies in escrow, as they “are property rather than actual currency,” as long as the holdings are kept separate from the lawyer’s own property. They must be safeguarded, according to the opinion, and records need to be kept for a five-year period.
Notably, the document calls for the use of multi-signature wallets to keep funds held in escrow more secure.
“Other reasonable measures may include maintenance of the wallet in a computer or other storage device that is disconnected from the Internet (also known as “cold storage”), a method that would also allow for off-line storage of one or more private keys,” the opinion adds.
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