The start of an ownership revolution? The future for real estate and other real asset investments?
Gimme a Brick · Nov 29, 2021 · 5 min read
By now, you’ve probably heard of or know quite a bit about crypto, tokens, NFTs, Ethereum and other buzzwords that have been floating around these days. It’s hard to ignore all the changes that have been developing over the past few years and why would you? The future of technology is certainly exciting. Blockchain has been the hot topic on everyone’s lips lately and its popularity and recognition has been on a steady rise. Bitcoin, STOs, ICOs and other concepts would not even be possible were it not for the remarkable system that backs them. With that being said, let’s have a quick refresher about the wonderful world of blockchain.
Ownership
First, let’s have a think about the things that you own: your phone, your car, your house, etc. What or who proves that you own these things? My guess would be some sort of registry. But even though you seem to own these things… technically, there is someone or something above you that allows or disallows that ownership. Oftentimes, there’s a higher power that controls your ownership of that ownership. A good example of this is seen in the dealings of land and real estate. In most countries, the government owns the land and dictates who ‘owns’ what. China, for example, owns all of the land in Hong Kong (with the exception of St. John’s Cathedral — the only freehold land in Hong Kong). The Chief Executive of Hong Kong can lease and grant state land to the public for ownership for a limited period of time. This is known as leasehold land. So, if you were to buy land in Hong Kong, yes you could lease it from the government for 50+ years but it would never truly be yours.
In most countries around the world the government is heavily involved with the ownership of land. Whether you are a landlord or not, ultimately, you are at the mercy of many other circumstances and powers that be. But what if there was a system in which you did have the right to ownership? A system where you do have a say, where no one is in charge and no one could tell you what is or isn’t yours?
The Beauty of Blockchain
This brings us to blockchain. It is not dependent on any individual or organisation. It is a system that allows for decentralised ownership. One of the factors that makes blockchain so unique and attractive is the fact that no one is in charge. Those who use it, run it. Even more enticing is the fact that things stored in the system are practically impossible to fake, tamper with or counterfeit. This incredibly high level of security gives users a sense of protection and trust that they may not feel using other distributed digital ledgers or online systems.
There should not be one sole owner, individual or organization.
Back in 1991, blockchain technology was being used to timestamp digital documents so that people could not back date or tamper with them. In those days, blockchain was fairly unused or recognised. By 2009, an anonymous entity who went by the pseudonym of Satoshi Nakamotoadapted the system in order to create the digital cryptocurrency, Bitcoin. From this point onwards, the digital industry would be changed forever. It is said that Satoshi Nakamoto’s true identity was intended never to be discovered because of the same principle behind blockchain — there should not be one sole owner, individual or organization who should be credited for or in ownership of everything.
A Secure System
Now, let’s briefly review how blockchain works. It might be helpful to imagine a blockchain as, literally, blocks and chains. Imagine that there are digital blocks that store information and digital chains that help pass information to and from different blocks. Inside each block there is data, the hash of a block and the hash of a previous block. Using Bitcoin as an example, the data stored in a block might be information about the sender, receiver and amount of Bitcoin. The second feature, the hash of a block, helps users detect any changes that occur in a block. You can think of a hash like a fingerprint — unique and a precise representative of a block and all its contents. If anything in the block changes, the hash changes too and if the hash changes, it is no longer the same block. This ripple effect lets users know about any changes going on. The last feature of a block is the hash of a previous block. You can imagine this feature as the “chain” aspect. Containing the hash of the previous block creates connection and security. Changing a single block makes all following blocks invalid.
Although disruption is technically not impossible, it is highly improbable.
As you might have guessed, the system is designed to prevent any tampering and for the most part, it works. However, concepts like proof of work and mining are also required to make the blockchain even more bulletproof. Another way blockchain secures itself is by being distributed. Blockchain uses a peer to peer network that allows anyone to join. When you join, you will get a full copy of the blockchain and when a new block is created, you will be informed. With all these things considered, messing with a blockchain would be quite the mission. You would need to tamper with every single block in the chain, redo the proof of work for each block and obtain control over more than 50% of the peer to peer network. Although disruption is technically not impossible, it is highly improbable — further highlighting why blockchain has become increasingly popular and trusted.
Whats Next?
As you’ve probably gathered, we should expect to see the use of blockchain popping up everywhere in the very near future. It is already being used for cryptocurrency, secure global payments, medical records, election fraud, smart contracts, stock exchanges, property ledgers and others. With the tokenization of real assets becoming a major topic of interest (e.g. real estate), one can only expect the use of blockchain to evolve too. It will be interesting to see the concept of decentralized ownership catch on and become the new normal. Some are calling blockchain the start of an ownership revolution and it’s safe to say many of us are excited to see what happens next.
Author: Lorraine Tashjian
Email: lorraine@landplus.world
Comments