Blockchain solution to validate property transactions

The implementation of this commitment started in 2017. According to the representative of the National Agency of Public Registry (NAPR), the main objective was to simplify the property registration procedures to ensure a higher protection of related transactions through the use of new technologies, and to increase property owners’ trust in public registration services. To that end, since February 2017, the NAPR has started applying blockchain technology in its property registration service, making Georgia the first country to do this.¹ The blockchain database has no centralised system or control unit that would be vulnerable to hacker attacks. Its records are stored in tens of thousands of computers around the world. By ensuring the security, transparency and accessibility of any transaction, the blockchain prevents corruption from occurring. Using this technology reduces transaction costs too since it is an automated system requiring no intermediaries. Each property registration document has a unique hash code, which is generated in the NAPR system. This code is sent to the global blockchain network, which confirms the validity of the document while excluding any illegal manipulation to change the data provided. Between 2017 and 2020, the NAPR applied blockchain technology to over three million property registration documents published on its website.² According to the agreement with the government of Georgia, during this period, the bitcoin mining company BitFury was registering unique hash codes of land registry documents on the global bitcoin platform for free.^{3 4} This was part of the company’s corporate social responsibility in exchange for consuming large state electricity resources for its bitcoin mining enterprise in Georgia.

While the blockchain technology can ensure the security, integrity and authenticity of personal data, including property data in this specific case, whether it is successful or not largely depends on social or political settings in a given country rather than on the technology itself. There also needs to be a digital infrastructure and digital literacy in place before piloting blockchain enabled registries, particularly in developing countries like Georgia. This is further complemented by high costs required for the application of such technology in the public sector.^{5 6}

Overall conclusion: the further assessment of the implementation of this commitment in Georgia proved those conclusions right. For instance, while browsing the NAPR website, it became evident that not all property documents registered in the system between 2017 and 2020 are protected through blockchain technology, while those documents that have been registered in the system since January 2021 are not protected at all since the agreement with BitFury expired.⁷ This leads to the assessment that the commitment has only been partially fulfilled.