Blockchain Advances With First Real Estate Deal
The blockchain ecosystem continues to evolve as competing industry alliances seek to push the transaction database technology deeper into enterprises, including the first international real estate transaction.
Blockchain serves as a distributed ledger framework that posts transactions in real-time as cryptographically unique “blocks,” visible to authorized users. These blocks cannot be reversed or changed, with new additions to the ledger posted on top of the register of existing transactions.
The Linux Foundation announced ten new members of its open transaction framework dubbed the Hyperledger, with membership in the blockchain consortium doubling over the past year to more than 160 members. According to the Linux Foundation, the consortium's goal is a "neutral technology platform" that Hyperledger Project members can use to differentiate future products "on top of the standard blockchain fabric."
The consortium serves as a clearinghouse for eight blockchain and distributed ledger technologies, including Hyperledger Fabric.
New Hyperledger members come from the financial, health care, secure supply chain and the gaming industry, the foundation said this week.
A competing group called the Enterprise Ethereum Alliance counts more than 150 members, including banks, credit card companies and regional government agencies. Recent additions include Cisco Systems (NASDAQ: CSCO), Mastercard (NYSE: MA) and ScotiaBank (NYSE: BNS).
While much it the early development work has focused on areas such as "crypto-currency mining," other applications include what is described as the first real estate purchase using the Ethereum distributed public blockchain.
Propy, an international real estate broker based in Menlo Park, Calif., said Tuesday (Sept. 26) it used Ethereum blockchain technology to purchase a $60,000 apartment in Kiev, Ukraine, for TechCrunch founder Michael Arrington, an early backer of the startup. Propy, which also serves as a decentralized property title registry, said the transaction was settled using "smart contracts" along with Ethereum crypto-currency and the startup's tokens.
The startup claims the deal is "the first real asset transfer via blockchain, and open[s] the door for many more remote real estate transactions on the blockchain."
Eyeing the $217 trillion global real estate market, Propy CEO Natalia Karayaneva added: "This purchase is an important signal to foreign investors—especially Chinese, who face strict capital controls of $50,000 per person—that they can safely and easily invest in this market."
The startup expects to expand its blockchain operations to Dubia as well as California and Vermont over the next year, Karayaneva added.
Among other things, Ethereum is designed to make it easier to create blockchain applications such as the Propy app. Meanwhile, the Hyperledger effort strives to create what members called an "enterprise-grade blockchain framework" that scales. The group is also developing an open source code base.
Juniper Research reported in July that 57 percent of large companies it polled said they are deploying or "actively considering" blockchain technology. Of those in the prototype phase, two-thirds said they expect the payment technology to be integrated into their operations by the end of 2018.