3.3 Long-term research challenges Several research challenges concerning smart contracts, distributed ledgers, and blockchains are currently being explored in academia. Financial institutions are providing input and inspiration by highlighting relevant business challenges in technology and operations. A good example is the potential for greater straight-through-processing from contract to execution. Currently, lawyers draft legal contracts, which are then negotiated and changed by possibly other teams of lawyers, and then operations staff inspect the contract documents and/or other materials11 to identify the execution parameters that are then passed to code that may have been written some time ago. This raises several issues: • Can we be absolutely certain of the meaning of the contract? Are all parties truly agreed on the meaning of the contract, or do they instead each have a subtly different understanding of what the contract means? • Can we be certain that all execution parameters have been identified by the operations staff? Can we be certain that those parameters that have been identified are indeed operationally relevant? And can we be certain that their names, types and values been faithfully transcribed? • After the parameters have been passed to the code, and the code runs, can we be certain that the code will faithfully execute the operational semantics of the contract? and will it do so under all conditions? Apossible solution would be to develop a formal language in which to write legal documents —i.e. contract documents — such that the semantics would be clear and the execution parameters could automatically be identified and passed to standardised code (alternatively, new code could be generated). This formal language would: 1. derive a number of important qualities from well-designed computer programming languages, such as a lack of ambiguity, and a compositional approach where the meaning of any clause can be clearly deduced without reading the rest of the document; and 2. be simple and natural to use, to such an extent that a lawyer could draft contracts using this formalism instead of using traditional legal language. The former aspect has already received considerable attention in academia (see survey in [11]) and beyond (e.g. open-source Legalese project [13]). In contrast, the latter aspect is likely to be by far the greater challenge. Another challenge is whether such a contract, written in a computer-like language, would be admissible in court as a true and faithful representation of the intentions of the parties. Issues of signature and tamper-evident documents are easily solved, yet whether a court would accept the definitions of the meanings of phrases in such a contract is not immediately clear. As illustrated in Figure 7, this problem could be solved in two ways: 1. As a first step, the language could generate a document version of the contract in a more “natural” legal style, with the expectation that this document would be admissible in court. 2. Eventually, further research in domain-specific languages and law could result in a new formalism itself being admissible in court. 11Other supporting materials may include confirmations, emails, facsimiles, telephone recordings etc. 11