Blockchain technology is being used to solve some of the common problems involved in commercial real estate, measured at a $217 trillion industry in 2015.
This tech could be used to find solutions for issues that have persisted in the industry related to the massive amounts of data that must be moved great distances in a fast and secure manner bringing the industry fully into the modern era. The blockchain provides the ability for us to create open communication channels between the existing real estate networks. These channels create publicly owned ecosystems that transfer the control of the data back into the hands of the individuals and corporations generating it. The public ecosystem is not owned or controlled by one single entity but rather by the community members themselves.
The product Ethereum, which uses Blockchain at its core, is being used to create smart contracts, which facilitate, verify or enforce the negotiation of a contract all without third parties.
It is believed the industry of real estate itself can be reinvented by creating a universal baseline of accessible and workable data. This could help alleviate the high cost of pulling and pushing data due to end-user license agreements amongst other concerns.
Data Sharing, and the Interplanetary File System
Another possible solution to real estate’s data distribution obstacles comes from Juan Benet, a Standford graduate who proposed the Interplanetary File System (IPFS) that would decentralize data transmission and storage.
The IPFS has meant data can move far more freely throughout the digital world. For example, if one Gmail account sends an email to another, the IPFS could make a direct transmission possible without a stop in Google’s server.
Stephen King (CEO of REX, not the novelist) discussed combining blockchain and IPFS to create data standards while syndicating the real estate networks of the world.
“These standards are necessary in the technology’s progression from safely and securely transferring digital assets (cryptocurrencies) to doing so with physical assets (real estate),” King wrote in Forbes.
King explained how blockchain tech is used to create channels of communication between real estate networks. These channels create ecosystems owned publicly that give control of the data back to individuals and corporations who are generating it.
Blockchain can be used to give each property a unique identifier, or hash, that is recorded in a global ledger. Users make sure addresses are accurate by cross-referencing a property with a recorded hash. This could be the foundation for a new, emerging, real estate ecosystem going forward.