Hertell discusses NFTs and Blockchain’s potential use in real estate transactions – Fin Tech

“I watched [the deal] and realized we’re still talking about a traditional real estate transaction,” said Pryor Cashman partner Hans Hertell. “At the end of the day, the buyer bought ownership of an LLC that owned the title to the property. They had to have wet-ink signatures on the deed when title was transferred.”

But some of those steps could eventually move online, perhaps even using blockchain technology, Hertell said.

“It is an open question whether in the future we will be able to overcome the traditional wet-ink signatures and deed transfer documents that need to be filed with the government and whether all this can be automated in a smart contract,” he said. “We’re not there yet, the law isn’t there yet.”

Smart contracts, software code that can be executed automatically when specified criteria are met, are not yet recognized by the legal system. There are also transfer tax considerations and a number of other paper requirements, Hertell said.

One place blockchain could eventually play a role is in helping automate title systems, he said.

“At the end of the day, blockchain is about cryptographic verification of transactions, and where it becomes compelling is in the area of ​​origin: clear chain of title,” he said. A more automated title system could have “everything on the blockchain, verified, and you don’t have to sift through a government registry that isn’t up to date.”