The announcement of the St. Louis law firm’s new Digital Currency and Blockchain Technology practice in January — the first of its kind in St. Louis — coincided with a surging national interest in Bitcoin, a type of digital, largely unregulated currency that operates without a central bank. Cryptocurrencies instead rely on encryption to generate and share currency and verify transfers.
A global network of computers records Bitcoin transactions in a digital ledger, or blockchain, in which transactions are organized into groups known as blocks.
The Capes Sokol practice is chaired by Sanford J. Boxerman, a white-collar criminal defense attorney who first encountered cryptocurrencies while advising a client whose Bitcoin-related business became the target of a state investigation for potential securities-law violations.
His client was found to be doing everything right, and the state closed the case without further action. Still, the case led Boxerman to learn more about the technology and join a related meetup group.
He quickly saw opportunities for his firm to handle more blockchain-related matters, particularly in its tax practice.
“There are a lot of unresolved tax issues that have arisen from digital currency,” he said. “It just kind of grew from there.”
A St. Louis native, Boxerman studied business administration with a minor in political science during his undergraduate years at Washington University in St. Louis.
He began to consider a legal career during an internship in the Washington, D.C. office of Missouri Sen. Thomas Eagleton.
“I saw all these lawyers running around Washington, and I didn’t know if they were important but they seemed like they were,” he said. “I thought I’d go to law school so I could be one of those people.”
He went on to Harvard Law School, where he graduated in 1988.
After law school, he joined Lewis Rice, where he worked for three years with Barry Short, a former U.S. Attorney and criminal defense attorney, until 1991. He spent the next three years as an assistant public defender in the City of St. Louis.
From 1994 to 2001, he worked for the Clayton firm Rosenblum, Goldenhersh, Silverstein & Zafft, where he met David Capes, his current law firm partner and a former prosecutor within the U.S. Department of Justice Criminal Tax Section.
He left that firm to help found Capes Sokol, where his practice blends criminal defense and tax law.
Quickly, the idea of handling blockchain and cryptocurrency matters grew beyond the firm’s tax practice. Boxerman said the firm’s leaders realized they needed to establish their own group. In addition to Boxerman, the practice group includes Michael Kahn, Michelle Schwerin, Douglas S. Dove and Andrew Blackwell.
Boxerman said the team represents a wide variety of legal experience, from intellectual property to tax and securities law.
“We wanted to cover a wide variety of practice areas,” he said. “I think we have accomplished that.”
Since its launch, the practice has continued to pick up business and gain traction, Boxerman said.
“Primarily what we’ve been doing is help people with the tax aspects of cryptocurrency,” he said. “But we have advised some people interested in starting blockchain and cryptocurrency. We’ve helped them with regulations.”
He said it is cool to be at the forefront of a new legal practice, even though he is also continuing to learn more about the subject as he goes.
“It’s kind of a challenge to pick out what has staying power and what doesn’t — trying to separate the Facebooks from the Myspaces,” he said.