A blockchain is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Blockchain gained popularity as the technology behind the cryptocurrency bitcoin and has since exploded its presence into just about every sphere where technology is used.
Last year, founder of online site TechCrunch Michael Arrington used an used an Ethereum smart contract to buy a Ukrainian apartment. Ethereum is an open-source, public, blockchain-based distributed computing platform and operating system featuring smart contract functionality. This made waves in the world of real estate and the blockchain world.
Blockchain technology provides an efficiency that is different from traditional methods. People who are looking for something beyond the scope of traditional banks and insurance companies are now seeing blockchain as the future.
When you control the legal ownership of real estate via self-executing code it can create an easier process and make some parts of the process fully automatic, blockchain experts said.
A smart contract could be set up to automatically auction a property after a certain number of payments are missed, and then split the proceeds between the creditors. Instead of needing to go through lawyers and manually conduct the process, in theory the SmartLaw code would handle all the administration of the auction, according to online website INC.
While the users of the technology have only positive things to say, it does not come without risks. Some people have said that it remains an un-ventured domain and it is unlikely that regular people would risk entrusting their house to a cryptocurrency.
According to INC website, a more straightforward way to blend the world of real estate and cryptocurrency is just to buy property using cryptocurrency. Los Angeles real estate agent Piper Moretti is actively representing and seeking clients who want to use their cryptocurrency investments to buy property. So far it’s been pretty uncomplicated: People sell their cryptocurrency when they’re ready to pull the trigger, they then complete a normal cash transaction.
Crypto-to-crypto transactions haven’t really taken off yet according to her.
“I don’t think blockchain technology is going anywhere. We’re on the very forefront … and that’s definitely going to disrupt the real estate industry.” Moretti said.
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