Constraints and Benefits of the Blockchain Use for Real Estate and Property Rights
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Purpose - Within the hype in the blockchain industry and multiple examples of failed pilots in real estate, a sobering outlook is crucial; otherwise, these pilots and misleading concepts may bury the whole idea of the blockchain use. The paper aims to research the possibilities of the blockchain and other distributed ledger technologies (DLT) and applicability of these technologies for different purposes in real estate, property rights and public registries. Design/methodology/approach - This paper analyzes possible scenarios and studies cases of the blockchain and DLT use for real estate and public registries and defines constraints of the technology and laws. Findings - Permissioned and private DLT systems cannot be considered a significant evolutionary step in government systems. The blockchain, which is distinguished from permissioned systems as the technology of the immutable ledger that does not require authorities, is a new word in governance. However, this technology has some principal features that can restrain its implementation at the state level, and thus require further research and development. In particular, the application of the blockchain requires a proper architecture of overlaid technologies to support changes of outdated and mistaken data, address issues of the digital identity and privacy, legal compliance and enforceability of smart contracts and scalability of the ledger. Originality/value - The paper contains a case study and conclusions, which are valuable for further research and development in this space. A multidisciplinary approach in analyzing the technology and laws helped to understand better how to improve public registries. The presented outcomes can be laid down as requirements for the technical protocols aimed to address the issues of DLT and public policies to put the blockchain at a service of society.
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