The American Arbitration Association (AAA) and blockchain documentation firm Integra Ledger on Wednesday, June 24, released the Legal Context Protocol (LCP), an open standard designed to attach verifiable legal terms to transactions conducted by autonomous AI agents.
Google, IBM, Circle, Wayfair, and more than a dozen blockchain and infrastructure companies signed on as founding contributors.
Rails for moving money between software agents already work as well as frameworks for verifying which agent is acting.
However, neither takes into account the legal terms governing a deal, the jurisdiction that applies, or the process for resolving disputes when something breaks, and this is the gap that the LCP addresses.
AAA president and CEO Bridget McCormack stated“If the legal terms that govern the transactions are not known or recorded in any single source of truth, your dispute about anything about the transaction starts at a really early phase.”
McCormack added, “You have to argue about what exactly the terms of the transaction were, and that’s going to be a real logjam in the success of an agentic commerce market.”
How does the Legal Context Protocol work?
Participating organizations host a JSON file at a standardized URL path known as “/.well-known/legal-context.json,” on their domain, similar to how robots.txt governs crawler behavior.
Before an agent commits to a transaction, it fetches that file, retrieves the terms document it points to, and checks a cryptographic hash to confirm the terms haven’t been altered.
The hash gets recorded alongside the payment. If either party later contests the deal, in court, in arbitration, or during a regulatory review, both sides can independently verify which terms governed the transaction without relying on the other’s records.
LCP defines four tiers of participation; however, none is mandatory, meaning that organizations can choose what fits their risk profile.
Who are the LCP’s founding coalition?
The LCP contributor list spans enterprise software, payments, and crypto. The enterprise side is represented by Google, IBM, Circle, UiPath, and Wayfair.
The blockchain networks include Stellar Development Foundation, Ava Labs, Cardano, Hedera, Mysten Labs (creator of Sui), Aptos Foundation, and Sei Labs.
Identity and infrastructure providers Crossmint, Pinata, Baselayer, Trinsic, and the First Person Cooperative also make up the group, according to the AAA announcement.
The protocol ships under an Apache 2.0 license, and its creators say governance will transfer to a neutral foundation so no single participant controls the standard.
Why is the LCP being released now, and why is it important?
Gartner projects that by 2028, AI agents will be involved in 90% of B2B purchases, routing more than $15 trillion through automated exchanges, data that was cited in the white paper published by AAA and Integra Ledger.
The AI agent market was valued at $7.92 billion in 2025, and it is projected to reach $294 billion by 2035, per Precedence Research.
Current developments are already gearing towards that future, with infrastructure for agent-driven commerce already taking shape.
Mastercard introduced Agent Pay for Machines, a platform for autonomous machine-to-machine payments backed by more than 30 partners.
Google DeepMind published a control roadmap for securing internal AI agents, estimating that agents could generate $2.9 trillion in economic value in the US alone by 2030.
In June, Coinbase launched a product letting AI assistants trade crypto and make payments through the x402 protocol.
Contract law already accommodates automated transactions. The Uniform Electronic Transactions Act and the UNCITRAL’s 2024 Model Law on Automated Contracting cover contracts formed through electronic agents and extend the principle across borders, respectively.
However, what none of these systems addressed before LCP was the evidentiary layer that courts and regulators need to enforce agreements.
McCormack stated that some open questions, including how to handle conflicting terms when two agents negotiate from different starting positions, have been left for coalition members to work out over time.
“Like with all the other protocols governing payments and connectivity, there’ll be lots of contributors,” she said.
GIPHY App Key not set. Please check settings