Many people believe that the use of blockchain technology is the future. Even more so, people believe that we are in the future right now!
Blockchain technology, though what it’s known for, is not just used in cryptocurrency systems like Bitcoin. It can be used for anything and everything regarding the use of transactions and data. All it is, in layman's terms, is a database that stores records of transactions. You can use blockchain technology as it relates to medical recordkeeping, retail, copyright, legal protection, and even real estate.
There has been a lot of talk when it comes to how blockchain technology could be beneficial to the real estate market. Since blockchain is only dealing with secure, digital transactions, you would do all the normal paperwork relating to real estate transactions, but through the blockchain. Usually, when you go to sign a lease or buy a house or buy property, there are tons of papers you need to sign. The issue isn’t the signing of the papers but storing the papers in a secured place that is easy to access. But if you were to do these signing processes through a blockchain, it would make storing transactions much easier and more secure. It would also reduce the susceptibility to any type of fraud or misinformation.
According to Consensys [Source], some other benefits of using blockchain technology in real estate include:
- "Tokenization of real estate assets
- Process efficiency for underlying industry operations
- Reduced costs from process automation
- Access to global asset distribution
- Access to broader investor pools due to ownership fractionalization and
- Access to secondary market opportunities and data accessibility to increase transparency and inform better investment decisions and portfolio management"
One of the most beneficial things that this technology can do for real estate is tokenization. Tokenization is a way to digitally secure any form of finances or property. This also includes real estate properties. When something is “tokenized” we are then able to move it around more fluidly. This could help in a case where we want to move our real estate assets or transfer the assets to someone else; efficiently buying and renting properties, etc. Doing this would also help to make your assets more accessible to investors and help to raise capital.
Doing these things would not be as easy if it were on paper. When recording transactions on paper, it is much more vulnerable to human error and even corruption. This is why blockchain technology is so popular now. Today, there are over 20 real estate companies already using blockchain technology because they believe in its efficiency and usefulness, and I believe this number to only rise in the future- which is now!
