It’s not often an article is published that grasps the fundamentals of a particular issue or topic – especially in the hyped-up, befuddling and esoteric world of blockchain.
An exception to this case are the attorneys from the Proskauer law firm who recently authored and published a well-written, relevant and succinct article in The National Law Review addressing key issues of blockchain adoption in the land registry space.
But first, to set the stage, we should revisit what land registries are supposed to do:
Land Registry Systems – Revisited
Land registries are systems in which matters concerning ownership, possession or other rights are recorded
- Recording is usually with a government agency or department (municipality, county, state, federal) or with a quasi-government agents such as the Cartorios in Brazil;
- Recording provides (or is supposed to provide you with),
- evidence of title/legal ownership
- facilitates transactions
- prevents unlawful disposal
- Information, documents and data recorded and the protection provided sometimes varies by jurisdiction but usually includes the information proving legal ownership.
- To maintain records regarding land and other real estate to properly assess its value and collect real estate taxes
- Promotes internal confidence (?) between its people, its commercial enterprises and its government
Market Expectations of Land Registration
- A simple, understandable procedure for recognizing rights;
- Effective, secure documentation of rights;
- Protection against infringement of these rights by others;
- A public record of these rights so others know;
- Records complete and incontrovertible proof;
- Convenient methods for transferring these rights;
- Effective procedures for preserving the written records.
The Proskauer article begins with the usual but important definition of the problem, “Despite dealing in one of the most valuable asset classes in the world, the real estate industry largely relies on outdated real estate interest recording systems requiring paper-based filings with local government offices.” It then references the potential of the “key attributes of blockchain technology to modernize real property conveyance and improve processes for recording deeds and other related instruments.”
But more importantly –— the article addresses 6 crucial legal and regulatory questions which affect widespread blockchain adoption.
Legal and regulatory issues are infrequently addressed or they are glossed over in most real estate industry blockchain articles so until further legal transparency is achieved and published, wholesale adoption of blockchain-based real estate solutions may face resistance by the various industry players – despite blockchain’s promise.
Below is the link to the article. If you have any comments please e-mail me at jmarkunas@PowerOfChain.com
– John Dean Markunas, Principal Consultant, Power of Chain and Leader-GBA Land Titling Working Group