What is blockchain?
And, what has it got to do with Commercial Real Estate?
Blockchain records transactions between two parties efficiently and in a verifiable and permanent way.
A “block’ is a record, for example a contract, in a list of records that are linked using cryptography. The linking of the records is the “chain”. In the chain, each block contains a cryptographic hash of the previous block. The “cryptographic hash” contains a timestamp, and transaction data. Breaking the encryption would be so inefficient and impractical as to be effectively impossible.
You have probably heard of it in connection with cryptocurrencies such as Bitcoin.
Blockchain has several advantages for commercial real estate:
1. Accountability –Blockchain creates an unchangeable, timestamped and permanent record
2. Transparency – All participants use a single platform as a source for transaction information.
3. Trust – Information cannot be modified or refuted once uploaded and verified.
4. Improved Efficiency
5. Reduced need for third-party intermediaries