Digital smart contracts are a step closer to replacing traditional paper trails in the conveyancing process after a trial using blockchain technology successfully allowed titles to be exchanged with no risk from hackers.
The two-month pilot project was run by Sweden’s land registry, Lantmateriet, using blockchains, which is the technology behind the digital currency Bitcoin. Concluding at the end of March, the trial used technology provided by Chromaway to carry out title registration digitally and securely. Title registration is a typical part of the conveyancing process that is also required in England and Wales.
Earlier this year the Land Registry of England and Wales carried out a consultation process that could lead to digital smart contracts replacing paper exchanges of contracts and mortgage deeds. The consultation asked for responses on allowing full digital conveyancing documents with e-signatures; more flexibility on Land Registry opening times; and simplifying and modernising its services.
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Digital fingerprint for authenticity
Last month Homeward Legal reported on the first exchange of contracts in a UK conveyancing transaction using electronic signatures. The Swedish trial takes this a step further and with further trials now taking place in the likes of Brazil, Georgia and Ghana, the future of conveyancing seems to be taking inexorable steps away from paper and on to digital smart contracts.
One of the biggest criticisms of conveyancing is the length of time the process can take – anything from six weeks to six months. Giving all parties access to secure online technology to share documents without the risk of fraud would speed up matters considerably.
Blockchain itself is a database maintaining records and transactions in “blocks”. As a system, it is said to be impenetrable to hackers, which is why it is the method of choice for the likes of digital currency exchange Bitcoin and is being trialled by the Bank of England for use in central banking.
Each document in the blockchain is given a unique digital code or “fingerprint” to prove its authenticity and protect its contents. Only verified digital IDs or e-signatures will be given access to the document, vouching for authenticity and preventing fraud.
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Future conveyancing certainly seems to be moving online. In the meantime, Homeward Legal can introduce house buyers to our nationwide panel of conveyancing solicitors or conveyancers who will get their transaction underway and completed in timely fashion.
Call our team now on 0800 038 6699 for an instant, no-obligation quote or click here. With our “no completion, no fee” guarantee, you can rest easy that it won’t cost you a penny if for some reason your transaction doesn’t complete. And with our team available seven days a week, you can be assured of immediate attention if you cannot get in touch with your solicitor.