Why Sweden is Taking a Chance on Blockchain Land Registry

Could the technology that powers bitcoin be adapted for land titling?

Sweden's land registry authority, the Lantmäteriet, seems to think so, and has emerged as one of the first national agencies to put its faith behind the use case. While there is a steady stream of projects pairing blockchain startups with government agencies, the Lantmäteriet's work is perhaps distinguished by the steady progress it's shown so far.

Working with startup ChromaWay and consultancy Kairos Future, as well as the SBAB and Landshypotek banks, the Lantmäteriet has been testing whether private blockchains can serve as a means of carrying out property transactions since last June.

The goal, according to the authority's head of development, Mats Snäll, is to reinvent the way land titles are registered.

He told CoinDesk:

"[We] saw that this process was quite conservative. It still consisted of paperwork and such things and [we thought] it would be a good idea to see if that kind of process was possible to change with the help of the blockchain technology."

The Lantmäteriet, Snäll said, was drawn to the openness and transparency that blockchain technology could potentially offer the agency, as well as Sweden's citizens.

"Land titling should be public, it should be open, it should be transparent and safe and secure," he said.

Blockchain promises

Blockchain proponents have made a lot of big promises around what the technology could do for the public sector, but land titling is also statistically a big concern. Around 70% of the world lacks access to proper land titling, according to the World Bank.

As an alternative to current systems, Lantmäteriet's private blockchain test envisions how to allow buyers, sellers, banks and authorities to track a transaction from beginning to end digitally, instead of using paper contracts, thus making tracking and transparency easier.

The idea is every party would have the information immediately accessible on the blockchain.

To date, Sweden is at perhaps the most advanced stages of blockchain testing for property records (though other countries like Georgia and Honduras have been moving forward with the idea). However, the nation is still a long way off from widely implementing a blockchain land registry platform.

While the trial recently completed its latest phase, the project remain in the exploratory stages.

"It's a very small trial so far, so ... we don't know if it will work in the wider perspective," said Snäll.

Upending the old

Still, Sweden is a developed nation with a land registry system that, while perhaps old-fashioned, is working adequately.

Upending that system with blockchain tech may promise a more efficient way of doing things in the long term, but people may still need some persuasion, according to Snäll.

"Still people ask, 'What is blockchain?'" he said. "It's still to be seen if one is against it or not. Right now most of the people are curious about it."

The next stage for the parties in trial is to get beyond this 'curiosity' period. Further, the project has not yet tested the blockchain with actual property records.

"This is something we will need to try in the next phase," said Snäll.

Legal barriers

For the banks, too, it's still a case of seeing how everything works.

SBAB Bank told CoinDesk last month that it has no plans to implement the blockchain platform in the immediate future and that the trial remains exploratory

Unsurprisingly, the biggest barrier to changing the land titling system is not the technology itself, but laws and regulations that have been in place for years.

"The interpretation of the law today is that all the contracts regarding sale, purchase and gifts of property should be stated in contract by paper and pen. In that regard, we need to change the law or change the interpretation of the law if we’re going to have digital contracts," Snäll said.

He explained that the Lantmäteriet has already made proposals to the government regarding the issue, adding: "Slowly we are moving towards some kind of action, I think."

A spokesperson for the Ministry of Justice, which would oversee such a change, declined to offer additional comment when contacted by CoinDesk.

There is, however, an ongoing government committee run by Sweden's Department of Finance that is examining how legislation can be changed or adapted for digital development.

"I hope that our area would be covered," said Snäll.

Mutual interest

But while the Lantmäteriet has spearheaded the use of the blockchain within the Swedish public sector, it's not alone in its interest.

Other agencies, like the taxation authority, are reaching out to the land registry authority to better understand how blockchain technology works and if it can be applied to their processes for handling information about citizens.

"Everyone knows we are involved in this project so they have contacted us," Snäll said.

Right now, the involved parties are mulling over the next phase of the land registry trials and how they should be developed going forward.

Still, according to Snäll, the next phase of the project won't start until summer or fall.

He concluded:

"Right now we need some time to explore and to summarize this phase."

Land image via Shutterstock; Mats Snäll image via Telia / YouTube