The Applications of Blockchain Technology in Real Estate market
The success of bitcoins has made the companies take notice of Blockchain technology on which the entire bitcoin program is based. Many industries have started exploring viable options for inducting blockchain technology into their system to make their system secure and efficient.
The blockchain is a decentralized and distributed list of records that are linked using cryptography. The blocks contain the information about the previous block, a timestamp, and the transactional data. Blockchain provides a distributed encrypted ledger to store the data which is spread across the network. Even if a device in the system is compromised, the decentralized nature of blockchain ensures that the information is stored in other devices of the network. Blockchain also allows retrieving the data in case of a system malfunction. Harbor, a San Francisco based blockchain startup actualized the decentralized protocol of blockchain to standardize the way crypto-securities are traded on the blockchain network.
The real estate industry has started using technology tools to enhance their efficiency. The industry is relying on technology to speed up their day-to-day business without compromising on the security and customer experience. Blockchain can help the industry to achieve their aim in the following ways:
Tokenization: Tokenization of resources can provide noteworthy liquidity to resource owners, enhanced consistency checks, digitized and faster settlement. Blockchain helps the real estate owners to trade on an open market through secondary trading. Tokenization helps to split the resources into tokens, and the tokens are stored on the blockchain network. Blockchain also helps the owners to sell only a part of their property.
Smart Contract: Smart contract is an encrypted program that is provided by blockchain technology. The contract operates automatically if the terms and conditions of the contract are met. The current processes in real estate have many middlemen. Smart contracts help to eliminate the middlemen as the exchange using the smart contract is completed between the owner and the purchaser. It also reduces the time taken to complete a contract. A smart contract is also a cost-saving option for both the owner and the customer.