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Blockchain is HEREIs the Real Estate Industry Ready?
November 2018
1 https://www.cnbc.com/2017/01/17/6-billion-smartphones-will-be-in-circulation-in-2020-ihs-report.html2 https://www-01.ibm.com/software/data/bigdata/what-is-big-data.html3 Annual Global Millennial Study, https://www2.Deloitte.com/uk/en/pages/about-Deloitte-uk/articles/millennial-survey.html 4 https://www.newscientist.com/article/mg23130810-800-the-100year-life-how-should-we-fund-our-lengthening-lives/
5 https://www2.deloitte.com/content/dam/Deloitte/il/Documents/human-capital/Thriving_in_times_of_digita_disruption.pdf
We are seeing unprecedented change and opportunity
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SevenDisruptors
Technology is everywhere
6.0 billion+smartphones in the world by 20201
AI, Cognitive Computing, Robotics
$500,000 in 2008$22,000 today5
Tsunami of data
9x more in last 2 years2
Major enabler of machine learning
Jobs vulnerable to automation
35% UK 47% US
77% China6
Diversity and generational change
Millennials 50%3
25% global pop in Africa by 2050 5
Longevity Dividend– 50 year careers4
Explosion in contingent work
US Contingent workers 40% by 20207
Change in nature of a career
2.5 – 5 years: Half-life of skills4.5 years: Average tenure in a job8
Blockchain Fundamentals
Near Real Time
No Intermediary
Distributed Ledger
Irreversible
Blockchain
“the Internet of Value”
Features Purpose Types
Public Blockchain
Fully decentralized – requires very low trust
Fully transparent – Anyone can read, send transactions and participate in the consensus process
Blockchains are secured by economic incentives and cryptographic verification; Low cost for transactions
Permissioned Blockchain
Quasi decentralized – hybrid; Read permission of the Blockchain restricted to participants
Participants can agree to rule changes, reversals and modification
Greater degree of privacy protections as only preselected entities are allowed to read the blockchain
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Key industry pain points could be addressed by a BlockchainFragmentation and Centralization
FunctionClosed
Source?Siloed Data?
Need 3rd Party?
TechnologyWhat Parties Needed to Complete?
Transferring Value (Payments, Escrow)
Wire Transfer, Check Bank, Escrow
Transferring Ownership (Property Search, Title, Conveyance, Contracts)
Paper, PDF, WebLoopNet, Zillow, NAR, Title Companies, Government,Attorney
Finding the right opportunity (Due Diligence, Identification)
Microsoft Excel, PDF, Web, Meets and Bounds, Addresses
Broker, 3rd Party Vendors, Tax Assessors
Unlocking Liquidity (Crowdfunding, Marketplace)
Database, Web, Wire Transfer
Banks and Crowdfunding Companies
Key industry pain points could be addressed by a BlockchainFragmentation and Centralization
FunctionClosed
Source?Siloed Data?
Need 3rd Party?
TechnologyWhat Parties Needed to Complete?
Transferring Value (Payments, Escrow)
Cryptocurrency MultiSigand IPFS
None
Transferring Ownership (Property Search, Title, Conveyance, Contracts)
Web, Blockchain Token, IPFS, Microsoft Word, Docusign
Government, Attorney
Finding the right opportunity (Due Diligence, Identification)
Web, Blockchain, and IPFS
None
Unlocking Liquidity (Crowdfunding, Marketplace)
Cryptocurrency and Smart Contract
Potentially None
The first SMART contract
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http://www.ubitquity.io/blog/ubitquity_llc_releases_highly_anticipated_blockchain_powered_real_estate_platform.html
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Smart Contracts to automate ownership
exchanges, payments, and access control
Blockchain enabled MLS, data platforms,
and identity managers
Property records and identity validation via
blockchain
Fractionalized and tradeable property rights via blockchain
Kevin Shtofman
Real Estate Technology
Deloitte Consulting LLP
1 214 840 7937
Twitter @kshtofman
LinkedIn Kevin Shtofman
