Distributed Ledgers
Issues with Blockchain & Distributed Ledgers in Real Estate
The Illinois Land Title Association supports several state legislative recommendations made in the 2018 Illinois Blockchain and Distributed Ledger Task Force Report (click here), including consideration of the Uniform Electronic Transactions Act and modernization of notary-related statutes. Blockchain may assure the security of electronic filings and provide an abstract of information from governmental entities; however, blockchain does not insure the effect or validity of recorded documents or provide constructive notice of those documents.
For a one-page white paper of ILTA's position regarding blockchain and distributed ledgers in real estate, click here.
A senior ILTA individual and long-time contributor, who is also an active member of the Illinois State Bar Association, Paul Peterson, published an article on the subject in the Illinois Bar Journal in February 2019. Click here for his article, Problems Blockchain Doesn't Solve.
The industry will also of course continue preparing for the development and use of blockchain as individuals and companies begin using distributed ledgers throughout the country, including some initial use in the real estate market...
Illinois is otherwise moving cautiously with some legislative movement in 2019 codifying basic blockchain and cryptographic hash definitions, see House Bill 2540 and House Bill 3575. Future reviews and work may focus on the Uniform Electronic Transactions Act (click here); Illinois is an outlier state in not adopting the Uniform Electronic Transactions Act but rather adopting its own, evidentiary focused Electronic Commerce Security Act, 5 ILCS 175, in 1999.
Digitizing Land Records & Title Policy Information
Another aspect of blockchain and distributed ledgers is the digitization of land records, which is a potential tool for Recorders of Deeds in Illinois, with Cook County embracing the option even more in the face of decaying records...
Blockchain and distributed ledgers has also been a step taken by some underwriters in the evolution of title plants...
