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For law firms looking for the next big lucrative niche practice area, cryptocurrency might just be it.
After all, your clients might just literally be creating money out of thin air, which means they should be able to pay the high price tags normally associated with niche practices. However, like everything else in this world, where there is reward, there is risk.
If you're planning on taking that risk on cryptocurrency clients, below you can find three tips on protecting those clients, yourself, and your other non-cryptocurrency clients.
1. Don't Get Disbarred
If you're considering taking on cryptocurrency clients, your first concern should be about yourself and your ability to represent those, and your other clients. Do your due diligence, then do it again. The legal risks involved with some of these cryptocurrencies likely isn't worth being involved (unless you're retained to provide a defense after the fact).
If you end up being implicated for facilitating a fraudulent scheme, like money laundering, that could land you in jail, which would likely be the end of your practice.
2. Don't Slouch on Cybersecurity
One of the most important aspects to cryptocurrency, generally, is cybersecurity. Not surprisingly, your own firm's cybersecurity is just as important. After all, if you're going to be involved with tech that is often used by criminal enterprises, you better believe that you've put a target on your own back. Your files will very likely contain some proprietary information that hackers might want to see, use, steal, or extort. Failing to implement effective cybersecurity measures not only puts your cryptocurrency clients at risk, your other clients will be vulnerable as well, as often, hackers will take whatever information can be sold on the dark web, like client, or even employee, financial information.
3. Keep Up on the Industry
Yes, reading about cryptocurrency isn't the most entertaining thing to do, but if you're representing cryptocurrency clients, you should be keeping up on the news in the industry. Currently, there is proposed legislation being talked about to begin specifically regulating cryptocurrencies, and being in the know about the progress and details of proposed legislation, government actions and criminal enforcement actions against other cryptocurrencies, can help you proactively advise clients on how to stay in compliance (and thus avoid enforcement actions).