Binance Founder Proposes AI for Legal Reform

Changpeng Zhao, the billionaire founder of Binance, has reignited the debate over the intersection of artificial intelligence and legal reform with a bold proposal: using AI to simplify national laws into clear, understandable language. In a post shared on X (formerly Twitter), Zhao criticized legal systems as “gigantic, patched, added, and often intentionally made complex.” He argued that AI and large language models (LLMs) are great at text processing and that laws should be simple and easy to understand by a normal person. Zhao also emphasized that his post did not mean to disparage lawyers; instead, he argued that their expertise could be better used in innovation rather than untangling legalese.

Zhao’s argument comes amid global efforts to regulate AI, such as the European Union’s AI Act and ongoing U.S. legislative debates. Yet, his suggestion flips the script, taking the conversation beyond whether AI can be regulated to talking about how the technology could help rewrite and streamline laws themselves. Legal-tech advocates have already embraced generative AI to simplify legal research. The U.S. tax code runs over 6,800 pages, and regulations like the EU’s General Data Protection Regulation (GDPR) have been repeatedly criticized for its opacity, even by the companies attempting to comply with them. AI-based platforms like Harvey.ai, used by major firms, and tools from Wolters Kluwer’s VitalLaw AI now assist in summarizing decisions and streamlining contract reviews.

Stanford’s Human-AI collaboration lab found AI-generated legal briefs often rivaled human-written originals, although it cautioned about the occasional hallucinations that have embarrassed lawyers and drawn strong criticism from court officers. Legal professionals agree that AI is part of their future. AI may shift law firm workloads from billable grunt work to strategic tasks, but legal practitioners must pair speed with judgment. A 2023 survey notes that 73% of legal professionals expect to integrate generative AI into their work within a year. While AI boosts efficiency in research and drafting, seasoned lawyers caution against blind trust without context and legal understanding. Binance itself has faced regulatory challenges across jurisdictions and reached a $4.3 billion settlement with U.S. authorities in 2023.

Zhao's proposal has garnered attention from legal experts and industry stakeholders, who see the potential of AI to transform the legal sector. However, there are also concerns about the potential for job displacement in the legal industry, as AI could automate many of the tasks currently performed by human lawyers. Zhao addresses this concern by emphasizing the need for reskilling and upskilling programs to help legal professionals adapt to the changing landscape. The use of AI in legal reform is not without its challenges. One of the main concerns is the potential for bias in AI algorithms, which could lead to unfair outcomes. Zhao acknowledges this risk and emphasizes the need for robust ethical guidelines and oversight mechanisms to ensure that AI is used responsibly and fairly. He also highlights the importance of transparency in AI decision-making processes, ensuring that stakeholders can understand and challenge AI-driven decisions.

In conclusion, Changpeng Zhao's proposal to use AI as a toolkit for legal reform and clarity is a bold and innovative initiative that has the potential to transform the legal sector. While there are challenges and concerns to be addressed, the benefits of AI in enhancing legal efficiency, transparency, and accessibility are clear. As the legal industry continues to evolve, the use of AI is likely to play an increasingly important role in shaping its future.