Want to steal a house? Doing so could be as easy as filing a fraudulent title transfer with the Cook County recorder of deeds. Homes that are owned outright (with no mortgage), often by elderly residents, are sometimes targeted by criminals this way—one only needs to forge a signature to make it appear as if he or she owns a property before selling it to an unsuspecting buyer and pocketing the cash.

John Mirkovic thinks that bitcoin, a type of currency, could help prevent such fraud.

Mirkovic is the communications director for the Cook County recorder’s office. He also runs its technology department. In May, while working to replace the recorder’s core land management system, he began thinking of ways to reduce fraud. By October, the recorder would announce a pilot program to use bitcoin to track and transfer real-estate property titles and other public records, becoming the first land recorder’s office in the country to do so, according to Mirkovic.

How can bitcoin prevent fraud? First, a background in how bitcoin works.

Bitcoin is what’s known as a cryptocurrency. Unlike conventional currency, it exists outside the purview of governments or banks. To build trust in the system, bitcoin uses a blockchain, a method to allow two individuals to transfer money directly to each other and ensure the integrity of the transaction. It is this verification process, not the currency itself, that is of interest to the recorder's office.

Any time a bitcoin changes hands, the transaction is encrypted and added to the blockchain, an enormous digital ledger distributed amongst the millions of people participating in bitcoin. When the bitcoin changes hands again, the system checks the previous transaction in the blockchain to verify that the seller is in fact the owner.

A similar process applies to buying and selling properties. When a property is transferred in Cook County, the recorder logs the transaction in a centralized location. Any time the property is sold, the buyer checks that record to verify the seller is in fact the owner. Today those records are stored in the recorder’s land management system. Mirkovic says at some deed offices, information systems aren't backed up. Since the blockchain is decentralized and distributed among many parties, there is less concern about losing data. And since the blockchain is openly available for anyone to review and validate entries, filing fraudulent title changes could become much harder, an important goal of the pilot for the recorder’s office.

According to Ragnar Lifthrasir, founder of Velox.re, a California start-up assisting the county with its pilot, “real estate is a better application of the blockchain than money.”

The pilot will consist of a single transaction. The transaction will be recorded in the bitcoin blockchain, right next to bitcoin money transactions. There will be a pointer in the recorder’s land management system back to the bitcoin record. The proof of concept may lead the Cook County recorder, and likely other recorders of deeds, to pursue this method of recording further. This will be a slow transition, as Mirkovic notes, since “the existing laws aren’t ideal for any of this.” Mirkovic says he has helped write laws in the past and already knows what needs to be changed in Illinois law.

“It’s becoming harder and harder to trust people,” Mirkovic says, but he feels that the blockchain technology will help restore trust. With blockchain technology, the authentication and trust would be built into the system. Mirkovic envisions a future where multiple parties —buyer, seller, recorder, attorneys, banks and others—would have to authenticate ownership with what's called a multi-signature transaction, like multiple people inserting a key to launch a nuclear missile. No longer could someone change a record with a single forged document.

Although the pilot piggybacks on the bitcoin blockchain, Mirkovic says the ideal framework would involve many municipalities in a statewide blockchain separate from bitcoin.

Velox is providing the software for the pilot, free of charge. Velox typically works with large real estate owners, not governments, but founder Lifthrasir says he is excited by the potential with Cook County. “The blockchain is not perfect,” he says, “but it’s better than the current system.”

It probably won’t be soon, and Mirkovic was unable to estimate costs for such a program, but bitcoin and the blockchain could one day upend county transactions beyond real estate. In November, Cook County residents voted to combine the recorder’s office with the county clerk’s office, which manages marriage and birth records. If the blockchain could confirm your marriage or birth, there wouldn’t be a need for a paper certified copy. We might carry a barcode in our wallet with the information necessary to verify a marriage or birth electronically.

Mirkovic personally sees car titles and election voting technology as the next practical uses of the blockchain. With bitcoin’s open and authenticated model, Mirkovic says, “even the government can’t mess with it.”