As early as 2013, the Shanghai real estate "Shanda Tiandi Youthli" developed by IT giant Shanda Network Group has accepted Bitcoin to buy houses.
Abroad, bitcoin transactions in the real estate industry are more frequent. Up to now, Russia, the United Kingdom, the United Arab Emirates, Japan and other countries have all experienced Bitcoin transactions to varying degrees.
In fact, the use of blockchain is more suitable for the real estate field than Bitcoin as a payment method. The blockchain can record the real estate location, address, and even details such as occupancy rate, house price, previous landlords and tenants, etc., allowing market participants to obtain more reliable data at a lower cost. Ragnar Lifthrasir, president of the International Blockchain Real Estate Association, said that the application of blockchain technology in the real estate industry will mainly include three ways: real estate purchase , real estate escrow and real estate ownership transfer.
reduce costs
Traditionally, buyers and sellers may need third-party assistance to confirm the identity of the buyer and seller, the authenticity of information, and even the sales commitment, and to ensure that the transaction is conducted in a safe and reliable manner.
Although it seems that transaction security has been enhanced, the cost of transactions has also increased accordingly. With the use of blockchain, the information and data of buyers and sellers and the real estate transactions will become more accessible, not only improving efficiency, but also reducing various costs.
Guarantee truth and transparency
Guarantee the authenticity of buyer information. In the blockchain system, all transaction records of each user will be completely recorded in the system. This information will help banks and mortgage companies to review customers' credit records more quickly, enabling real estate valuation, loan and mortgage applications, real estate Complex processes such as ownership transfer can be completed in a split second.
Guarantee the authenticity of seller information. At that time, all the qualification certificate files and historical information of the developer will be presented in the blockchain system, and the buyer can see the seller's information more openly and transparently, reducing the probability of fraud incidents.
real estate tokenization
In fact, many companies and start-ups in the real estate industry are already using blockchain solutions. Although the methods are different, there is one thing in common. The main idea of tokenization is that people can invest in real estate by purchasing digital tokens that represent real estate.
Real estate tokens issued by a platform
Tokens, as a kind of stake, are just not officially recognized. The laws of most national jurisdictions prohibit token issuers from distributing tokens as shares.
On the one hand, these tokens entitle their holders to a certain percentage of future buildings. Construction companies and contractors, on the other hand, sell tokens directly to raise funds for targeted construction projects.
Ideally, both parties are satisfied: the contractor has enough money to complete the project, and the future head of household can be sure that he will eventually get a return on his shares. To ensure the integrity of both parties, this real estate tokenization system introduces a smart contract that governs the relationship between the parties.
Other advantages of tokenization include easy distribution of real estate income, simpler title registration, lower barriers to entry for real estate investors, and blockchain guarantees that all transactions are fully traceable and verifiable .
While the theory looks perfect, current attempts to introduce tokenization into real estate still have a lot of legal process to deal with.
Existing case
Caribbean Islands, a company operating only in Spain and the United States, charges a 10% management fee. The upside is that it only conducts monthly audits and lacks minimum investment thresholds and dividends on real estate project income.
Property tokenization offered by similar projects could entitle investors to dividends on future earnings from construction. Once construction is completed and sold, the proceeds are distributed to investors. Although the approach seems to solve quite a few problems, such as investing in overseas real estate and barriers to entry that keep more people out of the business.
As another example, the Ethereal platform in the United States is positioned to decentralize the real estate market and also supports land title registration. Ethereal smart contracts allow brokers, clients, sellers and real estate agents to sign all transactions legally. This option is possible because smart contracts support transaction verification and tracking. It is currently being tested in California and, if successful, will be used in other judicial systems.
In China, on March 9, 2018, E-House China announced the " Housing Chain " in Shanghai. As China's first "open source" real estate blockchain scenario application research center, in the system model of the housing chain, everything can be based on the timestamp-based chain block structure, the consensus mechanism of distributed nodes, and the consensus computing power-based Economic incentives and flexible and programmable smart contract recording and delivery are the most representative innovations of blockchain technology and thinking.
As for the effect, it will take time to verify. This is likely to become a breakthrough in opening up the blockchain market in China. The real estate industry needs blockchain technology to bring about change.
Chain Vision, a blockchain entrepreneurial platform integrating media, community, consulting, training, and funds. (Chain Vision ID: lsj_btc)