Digital (smart) contracts are more and more common. Companies in Michigan as well as all over the world are racing towards digitalization, ditching the regular paperwork and working their way into the digital future. The problem is that digital contracts may handle significant amounts of money – and if those contracts end up getting hacked, they can lead to numerous losses to the company.
You must make sure that your digital contracts are protected, ensuring secure transactions and protection of both the funds and the information. Here are a couple of tips to be sure that your contracts are safe.
Carefully Choose the Programming Language
Due to their complexity, it is very easy to get a bug in the contract. With simple programming languages, you can draft a secure contract, as you have fewer chances of making a coding mistake.
Use Secure Digital eSignatures
Digital signatures are a good way to sign a secure contract – often preferred to the classic signature that could easily be forged. For instance, someone with practiced calligraphy can forge a signature – and if they also get their hands on the stamp, it can lead to fraud of great magnitude.
Unlike paper signatures, eSignatures have data that can be traced (for instance, an IP address and other information about the signer). This makes it much more difficult to forge. Plus, they save a lot of time and make it easier for the involved parties to look for the information.
Introduce Role-Based Access Security Measures
When creating a digital contract, not everyone needs to get access to said document. Similar to regular contracts, very often it is between the parties that sign them. There is no reason why other people should be able to access the document.
Use internal data encryption to make sure that only the parties involved with the contract can access it. It should be accessible only by encryption keys, which only the contract holders have. You may also make it so that it is accessible with a certain kind of software that only your company can use.
This way, even if they do somehow hack into your system and they get their hands on your contract, there won’t be anything they will be able to do with it.
Use Renowned Platforms
When sharing and storing digital contracts, make sure that you are using renowned platforms with all the security measures in check. They have to be properly encrypted and with a good firewall in place and possibly also use a VPN to avoid any tracking or hacking.
A good idea would be to install third-party software owned by a separate company, one that can take care of your platform safety encryptions. This way, you can reduce the risks of your contracts being hacked, protecting your company’s finances.
Keep the Cybersecurity System Up to Date
Many companies will set up a cybersecurity system and leave it just like that for the time being – until they replace it completely. The problem is that technology keeps changing. New bugs and Internet viruses can appear, hackers become even better at what they do, and your information becomes more and more compromised. This is why you should ensure that your security system is always up to date.
Get a Good Lawyer
Whether you need to use the attorney often or not, it is still a good idea to have someone on your payroll. They will make sure that you follow all the legal requirements and that you do not miss a signature or any formality. They have your best interest in mind, even for the simplest of procedures.
Make sure you hire breach of contract attorneys. Whether someone from your company knowingly breaches a digital contract or any confidential information is leaked, such an attorney may help you prevent a lawsuit. Digital contracts are more exposed to fraud than paper ones, so you need to be careful about everything.
The Bottom Line
Signing a digital contract is one of the easiest ways to conduct business nowadays – but at the same time, it can be quite risky. This is why you should make sure you cover every ground when it comes to security so that no one can breach your contracts.