Blockchain: Tech enables a truly international audience
The march of blockchain-backed property transactions into territory occupied by traditional conveyancers accelerated last week when a high-value commercial building went on the market with online execution offered by a digital platform.
With an instant digital contract created by a single mouse click, recorded on supposedly tamper-proof distributed ledger technology, this method of transacting property is being touted as the direction of travel for conveyancing, led by the proptech industry.
Despite HM Land Registry apparently taking a long view [1] on transforming the transfer of property ownership after completing its own blockchain trial, the sale of prime central London real estate does seem to represent an incursion of online conveyancing into a lucrative commercial property marketplace.
Clicktopurchase, the company whose platform is being used to effect the Mayfair transaction, has so far assisted in the sale of £225m worth of property.
The platform exchanges digital contracts and stores them on its own publicly viewable blockchain register [2]. Key legal documents [3] relating to the property can be accessed by potential purchasers online.
At £23m, the asking price of the latest property is almost five times more than the platform’s previous record transaction of £5m, according to Clicktopurchase chief executive Neil Singer.
He told Legal Futures: “This is a new market, with the tech enabling a true international audience.”
Teacher Stern, a 31-partner Holborn commercial law firm, provided the company with “the full legal package”, Mr Singer said.
He added: “A buyer’s lawyer can also review. When someone steps forward, anyone can make the legal offer for the buyer.
“The selling agent could accept for the client, creating an instant [digital] contract.”
Currently, while each stage of a transaction can be recorded on a blockchain ledger and contracts signed digitally, the purchase still has to be registered manually with HM Land Registry after completion.
A worldwide trial involving international law firms and banks successfully trialled end-to-end blockchain-backed conveyancing earlier this year [4], finding that the time taken to transact properties could be cut from months to weeks.