Crypto: Everything the Law Firm Managing Partner Needs to Know

Crypto: Everything the Law Firm Managing Partner Needs to Know

You’re at the top of your game, a leader of a top firm, you’re an expert. But there’s that one area where you need to catch up: cryptocurrency.

For those starting from scratch, we recommend beginning your crypto education with our Crypto 101 primer , which breaks down the difference between crypto and NFTs, explains how blockchain figures in, and lays out what exactly the metaverse is and why it matters. Just over a decade ago, crypto was a shiny new toy, a long-shot gamble on an intriguing technology. After a wild ride that has sent it to stratospheric heights and back down to earth, digital assets have become an everyday part of the legal landscape. Have you kept up?

We’ve talked to experts in the field about what law firm leaders need to know—and we’ve packaged it here with the idea that you can nail down the basics and build on that foundation for a solid grasp of what’s next.

What does crypto’s future look like? The Federal Reserve’s interest rate hikes have sparked a ferocious sell-off, though it’s unclear where things go from here. What we do know is that it’s extraordinarily volatile, and that a lot of money is at stake. Even if the market were to ultimately fizzle out, a few things are certain: There will be deals, there will be litigation, there will be bankruptcies—and that means firms have a big role to play.

“For a major law firm, it’s almost impossible to not have clients coming to you with crypto questions at this juncture,” said Kari Larsen, co-leader of Perkins Coie’s Blockchain, Digital Assets & Custody Industry group. “If you’re not fixed on it, you’re going to face a number of issues that your firm is ill-prepared to handle.”

Why now, in the midst of a sell-off in digital assets that has knocked $2 trillion off the market? Because despite that, thousands of legitimate players are still investing, and are going to need your help. If you don’t know how to give it, they’re going to someone else. Managing partners have to think strategically and look around the bend. Crypto is an area ripe for business development, but the regulatory framework is still being hammered out.

A sober perspective is essential in a young industry plagued with scams, money-laundering and black-market activity. But you don’t have to be an Elon Musk-level enthusiast to recognize that—for better or worse—hundreds of billions of dollars are at stake.

What follows is everything a managing partner should be thinking about around cryptocurrency, blockchain, the metaverse, and NFTs. If you’re starting from square one check out this primer first: Crypto 101: Essential Reading for the Law Firm Managing Partner Why: Clients Are Demanding It

Crypto’s impact on firms is being felt in mergers and acquisitions, securities regulation, bankruptcy, trusts, family offices, intellectual property, environment—even employment and divorce. Firms have organized themselves accordingly.

Perkins Coie formed its crypto group in 2013 from a team that had been working on payments issues, Larsen said. It now boasts one of the world’s largest, with more than 70 attorneys focusing their practices on blockchain and digital assets, and a client list that has included Nasdaq, Mt. Gox in its bankruptcy, and Andreessen Horowitz’s investment in Coinbase.

The firm has taken a “cross-functional” approach, Larsen said, meaning that group members have significant experience in the technology and industry concerns. It includes partners in technology transactions, white collar, real estate, intellectual property, investment management, privacy & data security, corporate & securities, and venture capital.

“A focus on the industry is what clients are looking for,” Larsen said. “Having that grounding means clients have certainty that they won’t have to start every phone call with a 10-minute explanation of their business.”

Alexandra Scheibe, who leads the FinTech and Blockchain Practice Group at McDermott Will & Emery, said firms are responding to client demand.

“That doesn’t mean the mainstream client base wants to invest in the most aggressive stuff,” Scheibe said. “It doesn’t mean they want to buy every single token on Kraken and trade it 24 hours a day. It means they’re trying to think strategically about crypto as an asset class or as an opportunity, and whether they should be involved.”

Scheibe said members of McDermott Will & Emery’s crypto group sit in their practice groups—litigation, transactions, tax, or intellectual property, for example. Clients include startups, larger companies, M&A targets and acquirers, as well as private equity funds and family offices. How: Find a Smart Way In

Managing partners have a mandate for both revenue-generating […]

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