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First US Real Estate Transaction in Blockchain: What's Next?

Vermont is headed towards blockchain recording of real estate transactions. Other states will follow.

Stories have been circulating about Vermont testing blockchain for recording real estate transactions.

A contact at Propy informs me that the city of South Burlington, Vermont, just became a global blockchain leader by locking in the first US real estate deed completely on blockchain.

Natalia Karayaneva, CEO of Propy said, "This is only the beginning. With this transaction, we've broken first ground in putting the $217 trillion real estate market on the blockchain. We're starting with Ukraine, but over the coming year we plan to facilitate real estate transactions with the use of PRO tokens in California, Vermont, and Dubai."

Business Insider posted this disclaimer "Propy is the source of this content."

I make the same disclaimer.

My contact says "This first deal makes it much easier for the rest of the 49 states to iterate the process. In fact, Arizona and Colorado are next."

I have some questions and will post an addendum when I have answers.

Implications

First, this is not unexpected. I have many times commented that blockchain is perfect for real estate transactions. Real estate is low-volume, high-value. Buying candy bars on blockchain is not practical. Blockchain does not scale.

Second. This does not change my attitude towards cryptos. At some point everything will be crypto, but it will be government-sponsored and it will not be Bitcoin nor Ethereum.

Finally, and most importantly, entire chains of business will vanish.

Think of the business of title insurance. Poof!

Mike "Mish" Shedlock

the title/mortgage/lien, is still in dollars, I assume. Since all contracts, bonds etc are in dollars, that is what props up our currency. The real news, is when contracts are negotiated in gold or cryptos/alternative currency...that is when the SHTF

How does using a non-distributed block chain in any way improve upon using a standard relational database to record property sales? In Florida, each county has a clerk of the courts who is responsible for safely maintaining property ownership records and the corresponding sale and contract information. How does using a block chain database improve on that process?

good point , i don't see the benefits of applying block chain in this particular application. The valued features of blockchain (e.g. encryption/security, audit trail/ledger, time stamps) should already be Incorporated in their current conventional data base . I will do more research , i was an AS/400 programmer analyst for many years . The As/400(now a dinosaur) had a feature called journaling that recorded all file activity (updates ,deletes, adds) .

Guess I just don't understand the difference between doing a RE transaction electronically and doing one using block chain. I just completed a transaction in AZ, remotely, pretty much on my ipad. Offers, counter offers, transferring funds, title search and closing all done using e-signatures, as was recording. After closing, for the heck of it, I printed out pertinent information for the file, should I suddenly become technically illiterate someday, losing what little bit of point and click expertise I already have. Can anyone direct me to an explanation of the difference between the transaction scantily described above, and the paperless transaction I described having completed?

Your comment is like talking up CNN and other fake news cites because the Internet is useful. What is Zerohedge's motive for pumping Bitcoin? What is the motive for businesses that will be displaced by cryptos to bash it?

BTW ZH does not talk up Bitcoin. He posts articles form others who do. Big difference.

Title insurance is one of those industries that is mostly a scam. Protected by lobbyists in DC. Consumers get gouged over-paying for title insurance that has a very, very low claims rate. Cash cow business. You do need title insurance in case there is a title issue, but it should cost far less. Real estate agents also are a rip off only protected by their power lobby in DC. Home buyers still get completely raped on fees at the closing table by lenders, Realtors and title companies. And it is all protected by powerful very well funded lobbyists. Real estate purchasing should have been totally disrupted by the Internet by now.....like travel agents were and retail stores were.

Of course health care is the same. As were know consumers get absolutely gouged as the status quo is protected from change by $$$$ lobbyists.

FWIW, Bitcoin is crashing again. After hitting about 19,000, it fell to under 7,000, then rallied back to about 11,500, but in the last few days it has fallen again to 8600, a drop of about 27% this week.

@Carl_R @MntGoat @Mish

In all honesty, who would you trust more to follow through on their outward promises, your insurance provider or your local murderous drug dealer? I'd side with the latter.

The day is fast approaching where anonymous purchases of ANY service online will be absolutely unstoppable by the authorities. It will be a combination of anonymizing technologies currently being pioneered: OpenBazaar, I2P and Monero.

The internet is bringing us back to the medieval period where if you want to purchase enforcement you have the choice of suing either through the king's courts via the local magistrate and the sheriffs OR you can sue through the lord of the manor and the (virtual) courts of local aristocratic powers (i.e. murderous drug dealers).

(edited)

For every pious Stephen out there who accidentally hired a clumsy assassin on the internet, we might presume a plethora of Stephens who got away with soliciting murder scot-free.

Let us assume that only 1% of the population is vindictive enough to have a dodgy local developer murdered for misselling them property, would that second-order of justice not be enough to render title-deed insurance redundant?

Let me tell you, I wouldn't screw over a client with a bad title plan if I knew I could be massacred in a drive by shooting whilst walking home from Costa Coffee the following week. If I heard that this sort of thing was going on to people like me, I'd play the game very straight indeed, from then on. Just saying.

Come to think of it, you might have to treat your exes a little better going forwards into the future as well. Especially the ones that are notably proficient in using the internet.

To use automobile ownership by analogy, blockchain should do for home ownership what carfax does for automobile history. History is the key word in a title search. And for mortgages which are repackaged (who owns them) there should be a good answer for that as well, simply because the computer program will not take NO for an answer.

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