It's interesting, both have registries, so why is one harder? Is it because the registry is better? No, it's because real property transactions are more complex:
- What condition will the property be delivered in and when? - What happens if the condition is not as specified? - what personal property is included in the transaction? What condition is it in? - Are there disputes over the property lines? - Are there easements? How do they work? - Are there third party consents needed? How do those work? - Will the seller vacate immediately, or will they rent back? - How will you pay for the property and when? - What happens if you don't pay? How much is the deposit and what are the terms of the deposit?
The complexity of the transaction derives from the complexity of the subject matter. Sure, if you could standardize those items, you could make property more like stocks, and people are trying to do that, which so far limited success. But for the average person, this is a huge investment, and they will want to spend time and create a transaction that works for them.
Almost none of the complexities related to the transfer of real property relate to issues with the county registry. Sure registries could improve, but very little would change.
One of the expenses is paying for title insurance. Sure in some sense a perfect ledger would obviate the need for that insurance. But given there seems to be more fraud in blockchain than in normal US real estate transactions, not sure the insurance price goes down, rather than up...
When you buy a house, for $1 million or $50,000, the normal case being described in yours and the parent post is that you are buying a house on margin while using the house itself as collateral for the loan.
If you show up at a house that is for sale and ready to be sold with a million dollars in cash -- well, a million dollars in easily-authenticated cash equivalent -- and ask to buy the house as-is, no conditions or concerns on your part, you can make a deal happen markedly faster. Not microsecond fast, because why, and the sellers might balk at such a weird transaction or shop around to see if they can get another seller at a higher price, but once you take financing and any sort of buyer-protection out of the equation it basically comes down to registering the sale with the local registry.
Over there, buying a house without taking out a mortgage does not count as "weird": it's not terribly common, but happens often enough to not be considered weird. After all, if you have 100% of the house price on hands, there is not much reason to take a mortgage with 20% down payment and then immediately closing the rest of 80%, is there?
Microsoft stock is basically fungible whereas houses and most other real-world property very much are not.
For houses this is easy to prove. But this goes for nearly every other suggested NFT application, including tickets.
But you can at least not need to trust the registry's "database" of who owns what.
So, you arrive at "your" property with a 20x20 pixel jpeg that you call your ownership rights (even such a jpeg would be prohibitively expensive to store on blockchain, but whatever).
So, you arrive, and there's someone else living there. They don't want to move out, no matter how much you wave your jpeg around. What does your NFT give you in this case?
But that doesn't mean anyone will buy a house by browsing some site and buying an NFT, even if this were prefectului legally worked out.
And that is because a house and piece of land are complex real world objects that don't live on-chain, and can be arbitrarily different from when the NFT was minted. Perhaps there was flooding and the house is now damaged. Perhaps there is some insect infestation. Perhaps the land is in the process of being expropriate for highway construction. Perhaps a nearby high-rise is obscuring all the sunlight and the house is to dark for your tastes.
The complexity in real-estate transactions comes from appraising all of these sorts of things, not from the need of keeping the lands registry up to date. To buy a house, you need to have an expert appraise it's status. You also need a contract that gives you some protection from hudden huge issues that your expert may have missed. These things take the majority of the time and effprt, and NFTs do nothing to help with them.
Buying houses are expensive because:
- Realtors are a state-sanctioned monopoly for real estate transactions and suck up a % of the costs. They also provide the necessary service of aggregating information about the market and negotiating on your behalf - Due diligence on the state of the property. This means inspecting that there’s no mold growing everywhere, checking that proper maintenance has been carried out, etc - Property law developed over literal centuries to provide the legal framework that we have now, if you damage something as you move out I can sue you to recover costs involved, we have statements about property state before closing, if the building doesn’t meet code we negotiate about who pays the costs - Property registries matter because legally speaking that’s a part of how you prove ownership. The county knows who to send the tax bill, if you default creditors can impose a lien, these are legal technologies that developed over time
This is why you can’t just pledge your house as collateral and borrow against it in a HELOC like you can borrow against your stock portfolio. The bank needs to verify that nobody else has a claim on your property and that the property actually exists and is worth as much as you say it is.
A house NFT has none of the legal protections of a SPA and all of the risks. If it’s not up to code you’re fucked, if the county has a tax lien there’s nothing you can do, etc. Us engineers like to think that everything is an engineering problem, and that’s often true, but law seldom works that way.
The idea of houses on a blockchain are pretty much a pipe dream. But there are a lot of systems in traditional house buying that could be made easier with crypto-like ideas. Saying “real estate should be on-chain” should be read as asking for more NFT-like features in how real estate is transacted.
- as a cash bidder you need to provide proof of funds to the estate agent, which might just be a screenshot of your entire bank account balance. privacy with a zk-proof could be used in theory here to hide your balance while still giving the agent confidence you can meet the bid
- blind bidding process is usually opaque and broken, subject to discrimination and some winks and handshakes behind closed doors between friendly parties. a blockchain would give transparency and treat transactions equally regardless of race, sexuality, and friend or family ties.
- settlement times are extremely long in the order of months, not seconds. this is sometimes just because some party including the agents are on holidays, or slow to respond to emails, or forget to sign some paper, or whatever.
- escrow and exchange of funds in some cases could in theory happen with smart contracts where both parties sign a message to perform the exchange, which would reduce the significant commissions and fees.
- the process feels archaic compared to buying most other types of property.
> as a cash bidder you need to provide proof of funds to the estate agent,
Here, you don't provide them to the seller, you provide them to the solicitor acting on your behalf. Even if we removed that person from the chain, they are required to perform KYC on these transactions, so for regulatory reasons I still need to provide proof of those funds.
> blind bidding process is usually opaque and broken,
As much as I hate this, that's a (design) feature not a bug. Blind bidding doesn't exist in a vacuum, a seller is perfectly able to accept a bid from a party. Blind bidding is what a seller would use in a competitive market to extract the highest possible bid. If they wanted to accept a lower bid they could, by e.g. accepting their favourite bid at the second highest offered price.
> settlement times are extremely long in the order of months, not seconds.
This isn't because of transactions though, this is because mortgages take _weeks_ to come through, solicitors and agents take time to communicate/juggle multiple accounts/offers, and frankly they're still working with paper documents and off of the "who shouts the loudest gets service" system.
> - escrow and exchange of funds in some cases could in theory happen with smart contracts where both parties sign a message to perform the exchange,
The problem with using trustless currency for physical goods is that you need to trust the other party. If they just walk away without providing the keys or clearing the house out, it doesn't matter what it says digitally, you have a problem.
> which would reduce the significant commissions and fees.
On my past property purchase, I paid ~6% of the value in a transaction tax to the government, and ~£1000 in other "legal" fees. Meanwhile the actual transfer of funds cost me £0, (thanks faster payments - free almost immediate transactions up to £250k), and if I was a cash buyer, a bank transfer would have cost me £35. The fees are negligible even today.
I've been banging this drum for years now, the problems you're outlining are not technical, they're policy and regulatory. You can solve all of the above problems with regulation, like we've done in the UK. That said:
> - the process feels archaic compared to buying most other types of property.
Couldn't agree more. It feels like being dragged back to the stone age.
Yes these are mostly policy and regulatory hurdles but there are also some technical solutions that could be applied here.. The fact that a screenshot of a bank website or PDF passes as proof of funds for a 6 or 7 figure cash bid is laughable.. the idea that a concluded auction won’t fully settle for days, weeks or months is wild after being accustomed to bidding and auctions based on smart contracts. if a listing agent accepted USDC and a zk-proof as a proof of funds for the bid, the actual transfer into a solicitor’s holding account could be settled in minutes and with zero privacy invasion.
This is all purely hypothetical, and not likely to work across the board.. but it does present some areas that cryptographic tech could improve upon our traditional financial system
There's nothing about blind bidding that is solved by crypto in any shape or form. Moving to a blockchain approach for bids doesn't guarantee that you have opened bids, you can still allow people outside of the ecosystem to bid externally.
> The fact that a screenshot of a bank website or PDF passes as proof of funds for a 6 or 7 figure cash bid is laughable
Not really - a screenshot or pdf passes if the person you provide the proof to is happy with it. If you try and prove your funds with a screenshot from <local credit union in the phillipines> for a UK property transaction, they're going to ask you for more details, and they're going to ask you where the money comes from.
> if a listing agent accepted USDC and a zk-proof as a proof of funds for the bid, the actual transfer into a solicitor’s holding account could be settled in minutes and with zero privacy invasion.
For transactions under 250k faster payments guarantees transactions in under 2 hours, and anecdotally when sending my deposit for my last purchase, it was confirmed in about 15 minutes. For transactions over 250k, SWIFT transfers take a couple of days _because of regulation_, not because of technical problems. They're subject to AML checks.
> This is all purely hypothetical, and not likely to work across the board.. but it does present some areas that cryptographic tech could improve upon our traditional financial system
It's pie in the sky thinking, frankly, and doesn't even pass the sniff test. I completely disagree that it improves upon our financial system. The delays in these processes today are around AML/KYC checks, surveys, ownership dispute checks, etc. If you remove the legislation around AML/KYC checks, and streamline the surveys/ownership verification process, you could turn the entire process into 30 minutes for transactions under 250k, and some number between 30 minutes and 1-5 days for larger transactions.
Meanwhile, if you keep the regulations, don't fix the manual part of fetching deeds from the previous owner manually verifying them against a local land registry, and move the entire thing to the blockchain, I would bet you'd save a couple of days off a multi-month process, _and_ you still need to trust that your solicitor has correctly verified ownership, sourced your funds, etc.
The policy that's needed to change here has _nothing_ to do with trustless systems, because fundamentally the system you're interacting works on trust. Me telling HSBC to wire £250,000 to my solicitor for a property purchase doesn't actually send them £250,000, it just marks it to be cleared at a later point, but from HSBC's perspective the transaction has mostly happened at that point, and if the receiving bank is Lloyds, they're more than happy to trust that HSBC is good for the £250,000.
If all parties agree that the smart contract is what settles the auction, then yes it could be superior in some ways, and inferior in others. Bids would be transparently recorded for all parties to see, perhaps held in escrow or using zk-proof to accept each bid, and accounts could be shielded to provide privacy. Accepting a new bid outside of this smart contract auction or after this auction settles would be a violation of the agreement. It also means the auction can be performed through an automated system, without a listing agent facilitating it via emails and phone calls, which is significant as that same agent stands to benefit if all parties bid higher than they really need to.
> For transactions under 250k faster payments guarantees transactions in under 2 hours, and anecdotally when sending my deposit for my last purchase, it was confirmed in about 15 minutes. For transactions over 250k, SWIFT transfers take a couple of days _because of regulation_, not because of technical problems. They're subject to AML checks.
Not all buyers have this smooth of an experience. I'm not disagreeing with you, the UK has good banking infrastructure and if every country in the world could send value through Faster Payments to every other country in the entire world, there would probably be less need for crypto. It is a pretty good model for how financial systems can be improved to facilitate most average use cases.
We are approaching this from different points of view and with different shared experiences around how smoothly our first-world home purchases and bidding processes have been, and that's OK. The fact that you think a PDF or screenshot of a website frontend is "acceptable" proof of 6- or 7-figure cash bid is probably enough of an indicator that we should just agree to disagree and move on with our day.
You know you can buy a house without a single realtor involved yeah?
Have a trusted third party transfer it back to you? Or give up your house to the hacker?
Or time delayed exchanges for important things like your house NFT.
> (i.e. the market value of the house + some percentage).
Where does the market value come from? "Market value" for properties varies wildly, and the number a property does not necessarily track to a fair market value - I might be willing to accept 10% under market value to someone who is a cash buyer because I need a quick sale, or I might be in a ripping hot property market where properties are selling for 20+% over their market valuations
> time delayed exchanges
That's all well and good if everyone involved is digitally contactable for the entire duration of the process, but if I'm ill for a period of time, or otherwise vulnerable, it doesn't matter whether the delay is 2 days or 2 months. The advantage the current system has is that there is inherently a central organisation that says "yes you own this" and they handle disputes. If you have an actual problem of suspected fraud (say your car catches fire with all of your ID in it), you can go to a government office, sign some legal documents, and get new ID and continue. Similarly, if someone impersonates you there are legal protections that can and are enforced.
Not with blockchains we don't. They're also doomed to fail, and not working. A system where your money loses 25% of its value in a day its completely unusable for a mortgage. Saying "I'm sure the problem will be solved" doesn't mean anything, you could say the same thing about a credit system.
Now who owns the house? Do we have to let it decay forever?
This doesn't even make sense. 'Realtors" is plural, and there are many, which is incompatible with monopolies. Realtors have a monopoly on their trade only because anyone competing with them becomes a realtor, by definition.
It's like complaining about the airlines' monopoly in air passenger transport.
https://en.wiktionary.org/wiki/realtor
https://en.wikipedia.org/wiki/National_Association_of_Realto...
Replace NFT with deed, and what you think we can’t execute the transfer quick enough? No we can but we don’t because, we want to title search, violation search, inspect, appraise, survey the freaking thing you are about to blow your life’s savings on.
There is a reason why people continue to lose millions and billions on NFTs and crypto and why systems to slow and prevent rampant fraud exist.
There is no real technical problem with a real estate transaction that has not been solved. I closed on my house remotely, in 6 weeks, never having met anyone except my broker. 6 weeks were spent doing due diligence inspections.
I have an NFT of the Brooklyn bridge to sell you, cheap, 200 million dollars.
Have you read any of the proofs behind any of these algorithms? Ever notice how often some one finds a crack and disappears millions of dollars? Think we’ll actually make it secure some day?
I’m also not convinced this even needs technology. Some things are better locked up on paper in slow, bureaucratic institutions surrounded by layers of administrators. Makes it a lot harder to break in and steal stuff.
Most people aren’t buying properties online like games on Steam. If it takes 6 weeks or 5 it won’t make much of a difference.
Even if you want to digitize proof of property ownership it would be orders of magnitude more efficient to host your blockchain on a handful of Raspberry Pi’s. You could probably manage all property sales on an entire continent with it. Not dealing the Sybil attack problem is a lot cheaper and easier than trying to deal with it.
It's not really the NFT that's the 'win' there, if indeed it is a win.
It sounds like a lot of work to build that though.
Maybe we can find some nerds to make it for "equity" on the chance that such a database has value? They could use it for other stuff too if they want.
Government run then, the institution that is involved with contract oversight here, an easily identifiable authority in this situation. If you don't trust that here, then there's no point in bothering with sales contracts in the first place.
> It'd have to be regularly audited but also kept as up to date as possible. It should have very precise access controls. Also, it should be as fast as possible, and there should be a record of everything that's ever changed. If you want a full copy of it, you should be able to request it at any time.
So like a database with auditing switched on? The type that is already run all over the world for all sorts of things?
> If you want a full copy of it, you should be able to request it at any time.
Like a database that offloads snapshots every so often? And maybe has an API in front of it allowing querying of public data? Like are run ... everywhere? For all sorts of things already?
> It sounds like a lot of work to build that though.
I mean, it sounds exactly like a ton of running systems with fairly standard options, so no, it seems like it would be fairly trivial.
And of course we all know that there are no development costs for blockchain solutions. Nobody needs to build a webpage, or develop smart contracts, or security audit them, or build in permission systems so there can be authority oversight, or provide APIs, no, they all just appear fully formed and fully secure out of the ether... no boring 'work' to build that!
"Blockchain gives you that for free" must be one of the biggest fallacies out there.
> Maybe we can find some nerds to make it for "equity" on the chance that such a database has value?
Doesn't sound to me like we need to give these 'nerds' a continuing stake in a public service. Any old software company can build that sort of thing out for you for a one-off fee. Adding profit motives for unrelated third parties seems to me like a pretty poor choice. But what do I know, perhaps we should introduce more avenues for speculation around the housing market, that sounds healthy.
I come from a place that still has toll booths so that toll booth workers can keep their jobs.
I have to take off my shoes before I can get on an airplane so that my government feels safer.
I personally compute my government taxes, which only occasionally (if ever) get verified. That's how we fund the country.
If I routinely saw the government creating new technology that improved the lives of citizens, I suspect I would share your opinion.
It would be interesting to map "places interested in crypto" against "places that have low trust in their government" and what kind of overlap there is.
The way I see technology in the US: First, the nerds get excited and start forming groups about it. Then, the business people figure out how to monetize it. Eventually, the government gets sold an overpriced enterprise solution. Then we do it all over again.
Then why are they going to bring in a blockchain solution? It's got the exact same problem there as any other software solution would.
That's my point here, making it a blockchain (or a database!) doesn't magically solve the root cause, it's just an implementation detail.
If it even is a problem (a lot of other posters don't seem to think so), the problem isn't that the data storage medium isn't decentralised, or that there's too much trust in the system, it's the absolute ton of bureaucracy and paper-shuffling that takes several weeks. Choosing blockchain + API vs DB + API here doesn't address that. The gains come from modernising the system, not the storage tech.
I think you've overlooked this in the grandparent, because you've probably never had the experience of going to a low-tech county property registrar's office to pull a record.
> it's the absolute ton of bureaucracy and paper-shuffling that takes several weeks
Of course, but so much of that bureaucracy is about being risk-adverse. I really do have to take my shoes off at the airport because somebody tried to wear explosive shoes once, about 20 years ago.
So, yes it's the "ton of bureaucracy and paper-shuffling that takes several weeks", but that doesn't really address what's going on. Our governments will easily adopt new technologies when they're simple.
If minting officially signed records is as cheap and easy on-chain as it looks like it's going to be, it would be silly not to use the technology, even if you think government should have been the entity to build and maintain it.
> Choosing blockchain + API vs DB + API here doesn't address that.
This whole class of technology precisely addresses that.
It removes the "who has to build and maintain this DB and keep access to it forever" step, which is pretty significant for important records.
Literal teenagers can buy and sell pictures of apes easier than I can prove to a mortgage company that I own my residence. Something isn't right there, and I don't think it's the children and their fancy record keeping that's wrong.
When the intern at a county clerk's office somewhere in the middle of the country says "hey boss, let's mint NFTs for these records, it costs about a penny each and I can set up the computer to do it as a summer project", that's about the threshold we need for widespread local government adoption.
And if governments ordering security theatre at airports is relevant to their ability to administer property then I've got bad news for you about the track record of people working on building important stuff on blockchains. Difference is they have no need to be involved in property transactions whatsoever, whereas when it comes to enforcing property rights you're stuck with government being involved anyway.
> I think you've overlooked this in the grandparent, because you've probably never had the experience of going to a low-tech county property registrar's office to pull a record.
No, I haven't overlooked this at all, in fact it's bang on with what I'm trying to get you to understand - that pulling a record can be made faster with a better system, yes. But for some reason you're insisting that only a blockchain can fix that, which is just nonsense.
> If minting officially signed records is as cheap and easy on-chain as it looks like it's going to be, it would be silly not to use the technology, even if you think government should have been the entity to build and maintain it.
You're glossing over the massive effort to bring such a system into place for the land registry in the first place, and reducing the entire problem to record signing. The signing of a record is the most trivial part of the problem. In a DB-driven centralised solution it would be actually free.
So I'll repeat myself here - you're trying to address a bureaucratic issue with a data structure, you're choosing one data storage scheme over another as if that makes the difference, when the difference that leads to the speed gains in the proposal is legislative change and modernisation, not a specific storage scheme.
> It removes the "who has to build and maintain this DB and keep access to it forever" step
It does no such thing, as the data structures and smart contracts specific to land registration will still have to be created, and updated as needs change over time, the human-usable interfaces to those will still have to be created, probably involving API servers and web UIs in the exact same way as any other solution. Someone has to build all this. Someone has to run the infrastructure regardless, and those people will want paying somehow. The fact you can abstract some parts of it away through a blockchain doesn't remove the need for that payment, perhaps in the form of transaction fees, for instance, or rent seeking on these tokens you mentioned earlier.
> Literal teenagers can buy and sell pictures of apes easier than I can prove to a mortgage company that I own my residence.
Umm, so? I mean, Ape pictures are again, trivial, land registries are not, and the proof you want could be an entry in a land registry database just as easily as it could be an NFT. (As it could be for that ape picture, and as it usually more or less is anyway, due to centralisation of API-provision...)
> When the intern at a county clerk's office somewhere in the middle of the country says "hey boss, let's mint NFTs for these records, it costs about a penny each and I can set up the computer to do it as a summer project", that's about the threshold we need for widespread local government adoption.
And that intern is going to know how to implement all the smart contracts around property transfer correctly, taking into account all the legal regulations, edge cases, boundary definitions (and disputes), court system oversight and the million and one other things that are implicit in that proposition?
Seriously? You genuinely think the hardest and most complicated part of transfer of property ownership is the bit where you need to sign a record?
Because that's all you're talking about solving here, and even that isn't something a blockchain solution can do any more easily than any other solution.
All of the benefits of moving to a blockchain that you list are possible, probably with lesser effort and lower complexity, using other systems. None of it is because of blockchains, all of it is process modernisation that you feel you can just gloss over because blockchain.
Your argument is akin to being anti-Twitter because the local government could build a notification system just as well. Maybe San Francisco could, but most of America cannot.
Twitter's core function is that it lets you send and receive short messages. That's absolutely great for a local government office, but it didn't make enough sense for any local government to invent Twitter. That's not the job of local government.
The value here is in the network effect of agreed upon protocols between interested parties.
If parties agree on data sharing protocols, which is something we've all been talking about forever, then the network gains value.
> we can transact using an on-chain NFT that grants the equivalent of ownership rights to the house
He's literally talking about ownership rights tokenized for convenient settlement with a governance layer that can be overridden by officials. I think that's a fine idea to try out. It will probably reduce friction most of the time.
> you can just gloss over because blockchain
The idea is that a universally trusted, always-on database allows you to build new types of applications. This seems obvious to me.
I was listening to NPR a while ago and they had story on about governments that paid for ransomware attacks so they could access critical records. That's where we're at today.
All networks are hard to get off the ground. If you can't tell, I was a fan of the "semantic web" idea. I feel like this time it's going to work because there's a money-layer built into it.
If you think a government bureaucrat or judge will trust a blockchain because "proof of X" when a dispute does happen, you've got some weirdly conflicting beliefs about government. Furthermore, if you think they would trust it more because it's public then they would trust a DB that, say, Price Waterhouse Coopers were running that any county clerk could sign in to with an audited account and put some information in, then again I really don't understand what is your mental picture of the government.
However you slice it, the fact remains that, if there is ever a dispute on the ownership of your property, the government will want to consult an official paper trail of how that ownership came about. The more layers of abstraction you add, the more places your trail could be attacked, the longer it will take to do it, the more expensive experts will have to be hired for the trial and so on.
Permissionless databases also lend themselves well to a kind of DoS attacks, where someone can trivially bury the real data in mountains of low-effort fake data (perhaps with some high-effort fakes thrown in as well). If the county clerk's intern can mint an NFT for each house in the real registry, I can easily mint 100,000,000 fake NFTs for the same houses as well - good luck disputing the ownership then if your house purchase wasn't registered in the paper registry.
A permissioned DB run by a trusted entity (which could easily be some company, even though I hate that this is what usually happens, and would much rather see the government handling internally) that is responsible for auditing who has access to modify the digital registry and so on is the only possible solution for improving the bureaucracy of this. And even then, it will only improve it so much, since you will still need to send documents that prove you are who you say you are, and the other party is who they say they are, and you both agreed to the contract that made this transfer possible. Of course, much of this can also be fixed by using a government-certified digital certificate proving your identity (this is a common service in the EU at least).
You, and every other crypto bro vastly underestimates the scale at which local government operates. And the scale here means not "number of transactions per second", but "number of edge cases that need to be handled on a daily basis."
Some time ago I was in a conversation about how blockchain is going to solve everything around property registrations. Blockchain is just a slow distributed database that solves jack shit on its own, of course.
Here are some simple examples that land registries have to deal with: https://news.ycombinator.com/item?id=27212564
Good luck to you and your summer intern minting NFTs for that. And that's before we go into the whole definition of ownership https://news.ycombinator.com/item?id=27217681
Was that before or after listening to NPR and their story about private companies that paid for ransomeware attacks (https://www.npr.org/transcripts/1003972313, many many others)?
Not really, they could all deploy the same DB solution, we could open source it and containerise it and give it away for free. It could be run as a managed service for a small fee. There's no need for each local government to design their own or even run their own.
Exactly the same as with a blockchain solution.
> Your argument is akin to being anti-Twitter because the local government could build a notification system just as well
My argument is not in the least bit akin to being anti-twitter. My argument is more like saying twitter is possible with multiple different back-ends, conceptually. I'm saying look, your short message service can be implemented in a bunch of different ways - in the back end it could run on a NoSQL server of some sort, or some sort of RDBMS, of which there are many, or we could probably mash something up with SQLite to get off the ground. The important thing that's addressing the need is to build a short message service.
In contrast you're there insisting that only an MSSQL system will enable twitter. But with MSSQL we get archiving for free! And with MSSQL we can just UPDATE a record and it will be changed! Huh, how about that?! Nobody else can do that!
And I'm here scratching my head and saying that's just an implementation detail, sure, it could work, there will be license fees etc, but it's not the only way, and we still need to do the rest of the work.
> If parties agree on data sharing protocols, which is something we've all been talking about forever, then the network gains value.
Yep. And those protocols are still going to have to be designed and deployed by someone, a blockchain solution doesn't magic these into existence any more than any other solution does. APIs and UIs will still have to be built. Data schemas will still have to be defined. It doesn't reduce engineering effort.
> He's literally talking about ownership rights tokenized for convenient settlement with a governance layer that can be overridden by officials.
Sure, and maybe it would work great, but that doesn't require a blockchain either, it doesn't need to be an NFT on a public blockchain to provide that low-friction experience.
Throwing 'blockchain' at a massively complex situation doesn't solve anything in and of itself. It seems to me that saying 'blockchain' allows its proponents to mentally skip to the end of the process, where the value actually comes from one of the early or middle steps.
Step 1: Figure out how to encapsulate land registry records in a simple but comprehensive way
Step 2: Make legislative changes such that these records are now the source of truth
Step 3: Expose these records in an easily digestible and transferable way
(edit/addendum - > If you can't tell, I was a fan of the "semantic web" idea.
I always found that really naive, perhaps I just never understood it, but it seemed to rely on honest actors categorising their content in ways that would allow it to be retrieved, catalogued and processed correctly, then presented to users. Some of the professors at my University, Southampton, were well into it. Even back in the late 90s I was jaded enough to know that anything relying on people to be honest and not use all sorts of SEO tricks to game the system was doomed. I know there was more to it than that, and some of its ideas did filter into the modern web in various ways.)
Besides replacing it with tech bros and crypto douchebags doesn't seem like much of an improvement.
If anything (at the risk of sounding extra American), these threads remind me that the US is still the place to be if you want to build something different.
There's a positive side to how the US works too. The few things we really commit to, like building our military, we really are the best at. Also, the lax regulation does let new technologies like driverless cars get tested on open roads. Hurray? I think so.
Somewhere has to be the test-bed for new ideas. When they fail, they'll be expensive and stupid and maybe even stick around for a lot longer than they should (can we please, please, fix the shoes thing with the TSA?). But all together, we do a lot of cool stuff first that changes the world.
Interesting, because recently the USA exited Bloomberg's top 10 innovative countries, while if I remember correctly 7/10 where European countries [0]. Sorry guys, you can't stay on top forever.
[0] https://www.bloomberg.com/news/articles/2021-02-03/south-kor...
Governments, by design, are the most dangerous institution we have. In the 20th century they were a leading cause of death. Between the wars and communist policy a lot of people died. Fear of government is entirely sensible, we're more likely to be killed by a government than any serial killer.
And we don't know what the big wars of the 21st century will look like, but we may be about to find out.
You need something that's going to help you solve disputes and enforce contracts. If the government isn't competent or your enemy for arbitrary reasons, they'll just ignore any evidence you can point at and do whatever they want to anyway.
> But in the 99%+ of times you're in the happy path, economic transactions occur based on autonomous rules encoded in software.
In the happy path, people just “trust” that the system works; that the merchant and cc company transact properly, that cc company and bank work together, that the software underpinning all this is tested and has no errors, that the bank and cc company can help in disputes of fraud from the merchant…
It’s actually based on a lot more trust than the normal person realizes and polar opposite to nearly trustless.
(1) Do we really want high frequency markets in real estate? Is that socially and economically desirable?
(2) Land and property records so far have survived centuries (if not millennia), can we hope that an NFT solution will have the same long-term compatibility?
Not really, no. Just taking the European example, there have been countless cases of litigious states of affair after e.g. invasions, revolutions, nationalizations, privatizations, etc.
E.g. a house in Romania post Ceaucescu fall, a noble family's domain in Russia in 1917 or France in 1790, a German estate in East Prussia in 1945, a property in Kosovo, etc.
Where I live in Europe nothing litigious for about 200+ years and I can easily pull records for my place beyond 100 years without any need for reading/parsing technology.
So I imagine they can either legal pressure on the illegitimate owner to transfer the NFT to the other owner (which has worked with some bitcoin transactions in the past), or if that doesn't work, then the system of smart contracts created for something like houses would most likely have something in it that allows the smart contract owners to mark that NFT as void in the blockchain (while it remains in the perpetrators wallet, it would no longer be associated with the physical benefits) and have a fresh NFT minted based on the data in the previous one and sent to the legitimate wallet.
Barring all that, they could just not recognize the owner and send police to physically remove someone who thinks they own it because the have the NFT. That's one reason why some people like bitcoin so much, the government can't (easily) take it from you by force (because there's no physical aspect to it) like they can a home or gold.
If this were to happen and the blockchain and the physical world diverge, how would potential house NFT buyers know whether the physical house purportedly linked hasn't been overridden by local government? If the answer is for local registries to publish a list; then that list is the only thing that matters. The entire blockchain component becomes completely superfluous and a centrally managed electronic exchange would be faster, easier and cheaper.
And calling read-only functions (doesn't write anything to the blockchain) doesn't cost anything.
I didn't think of this with my original post, but there are NFTs that are used for access to things that people already say "don't buy these on the secondary market, legacy, no longer used". Not too dissimilar of an idea. Those NFTs are still in those people's wallets but it no longer provides the benefits associated with it.
Like the old Premint pass, which gives you access to tools to help launch NFT projects. The description for the old pass says "DO NOT BUY THIS PASS. This pass has been replaced with the PREMINT Creator Key" and the banner image says "THIS PASS IS NO LONGER VALID": https://opensea.io/collection/premint
“NFTs create a frictionless easily exchangeable market for goods… BUT make sure you check with the people, project, company or government that has authority over this good as to whether this particular NFT is actually a useful representation of anything. Because, at any arbitrary point they can just decide to not honor any of these.”
Why not buy the good directly from this party? Then at least the government has authority and can enforce your right to the product or service or at least a refund?
It's up to the organization or society or code written in smart contracts whether they want to honor, and how much they honor, the promises made for having possession of that NFT. It's really no different than any other organization out there for any service.
I can buy a ticket to a concert and be denied entry as well, or the concert be cancelled, or the company goes out of business, or any other manner of things. I still have the ticket, but it no longer provides the benefit associated with it.
Additionally I can go to the concert, and then try to sell the ticket to someone else, possibly claiming that it will let them get into a future concert, and that buyer needs to verify that the legitimacy of the ticket before purchase.
Or someone who buys a video game that's basically just a case with a code to download the game from a store that then redeems the code but sells the game to Gamestop with a no longer valid code, and Gamestop puts it back for sale even though it's basically useless at that point. That's kind of what's going on with people putting those old Premint passes up for sale on the secondary market.
You could argue that organization should not be trusted with future NFTs or be sued and punished, or the person who sold the now defunct NFT be punished, and that's fine, people no longer patronize or sometimes sue organizations or people all the time when they've been wronged somehow.
As for Premint, they do want you to buy directly from them and not from the secondary market. That's what they are directing you to do. I don't know too much of the details of Premint but they probably wanted to upgrade their service and used older smart contracts without update capability built into it, so the contracts were immutable and limited in some way.
So they needed to issue new smart contracts that had better capabilities, and in the process it rendered the old contracts obsolete. I'm guessing, I don't know, I'm not a customer and I don't work for them, it's just a service some people I know were considering using at one point since it's huge and has a large network of users and one of the things their service helps with is limiting access to bots, which is something the people I know cared about preventing, and is difficult to prevent, at least currently, in web3.
Additionally, a lot of the community are against upgradeable contracts because they theoretically can be upgraded to something totally different, and they prefer immutability, with all its potential warts. Some projects use upgradeable contracts and don't have to do what Premint did, and some people don't.
But regardless, if you're going to offer an organizational service that's not on the blockchain, then inherently, by definition, it can't be strictly enforced just by the presence of an NFT, because people aren't computers and their physical actions aren't guaranteed to happen by lines of code like a computer program can (at least not yet).
Tickets for a concert were a meatspace analogy, not me arguing to put all tickets on the blockchain. One difference, though, is the NFT 'ticket' can be proven for any organization that wants to incorporate it, without a prior agreement or API access created by the original organization. Like I know some NFT projects allow people who have NFTs from other specific projects in their wallets to have early access in their own projects, or grant access to private Discord rooms, or let them into events, etc. and it can be granted via software, without people checking or verifying anything.
Yes a REST API and a centralized database can provide that, but not if that organization goes defunct.
As an example from my own history, there's a game I worked on once that the company once debated on buying servers to host the multiplayer aspects of it, but eventually I just incorporated the general async turn based api of Apple's for the game. The company went defunct not even six months later. If we had gone the server route, the game would have been unplayable as soon as the company folded, but since we used the general protocol provided by the platform, the game was playable for many years afterwards (might still, I haven't checked in a while).
That's a very real (to me, anyway) benefit of building on a blockchain. As long as the blockchain platform is still up, those smart contracts can still be used, and its support doesn't have to be constantly justified by the parent company / count on the company not going out of business to keep running. Like Nintendo is getting rid of its Wii and 3DS shops here in a few months because they can't justify keeping it up. If the blockchain existed then and those things were stored on there (like files are stored on IPFS or Arweave for web3 today) they'd still be accessible without any continued expenses from Nintendo.
Right now I'm having to decide which of my digital games I need to make sure are downloaded and on my device before I lose the opportunity to redownload in a few months (technically I can hack the device and download stuff from torrents, but I'd rather not have to do that for a while, if ever).
Another benefit, to me, is similar and legacy related. Like my Facebook profile, website, games, journals, etc, when I die, all go away the instant that Facebook stops being a thing, and more importantly when I stop paying for web servers or cloud computing. My SO already made it pretty clear they're not really going to do anything to perpetuate them, so if I want those things to exist and be available I'll need to find something that can withstand not actively paying AWS, Azure, DigitalOcean, etc. to keep it going. Putting these things onto the blockchain would allow for that, and at the very least will outlive anything put onto cloud services, and possibly even the current crop of social media websites (definitely a few of them, maybe not all of them).
Some things I worked on are probably also circulating in some torrents of Flash games or console games also, but a lot of it isn't. And I have some physical copies of things I've worked on also (a lot of board game prototypes, some journals, etc), but I have a feeling a lot of that is just getting thrown away not too long after I die unless I something of mine becomes a big hit, maybe not even then.
You might not personally care about these things, but other people do. Or at least will once the infrastructure and supporting software is built out more.
FWIW I also think general protocols on long lived platforms and IPFS are great.
BUT, I really don't think the blockchain has a role to play solving any of the issues you laid out. The reason the game you mentioned was able to continued to be played was because Apple was providing the network. The minimum ETH write fee is almost always at least $1 and frequently cost $3.50. Would people still be interested in playing the game if each write cost that much? Same goes for your archiving plans. IPFS is great but it's not a guarantee that that data will be seeded forever. For that you'd need to write it to one of the chains you're confident will survive. ETH data costs somewhere in the thousands of dollars per MB range? I'm not sure it's a real solution to that. I'm not dismissing the issues of very long term code and data longevity. They are real issues but in my opinion still quite unsolved.
I wish there was something kind of like bit torrent that lived on people's computers that helped maintain a certain amount of data for every person if they wanted to (even if it's just text data, like journals or stories or a simple message to future people that might stumble across it, whatever), that would remain even when they're gone, and can be accessed by people who do searches by certain types of metadata (or by name), and didn't cost any money or web 3 tokens or crap to keep the platform going. That would be my preferred method. I've even been tempted to work on building such a solution at times.
But until then, web 3 seems to have the better solution to what's already out there at the moment.
To be perfectly pedantic, you still aren't the owner of the Microsoft stock. Your broker makes a record of you being the beneficiary of X shares of Microsoft stock, with about a dozen asterisks. Each of those asterisks fall off over the course of the next few days and then it is all finalized - your broker owns a bunch of shares for your benefit.
It only feels like it is instantaneous because they assume everything will work out (it usually does). They can do this, because everything is reversible if it doesn't.
Now, if you would like to be the actual owner of Microsoft stock, you can do that. If you've never done that before, expect the process to take a few weeks. But go right ahead - head over to ComputerShare [1] and start the process. If you really want, you can even get them to issue you some paper stock certificates in your own name, but that takes even more time and comes with a lot of extra fees.
[1] https://www-us.computershare.com/Investor/#DirectStock/Summa...
Who enforces seizure when lendee defaults but the lender is "anyone in the world"?
""" Nobody owns stock. What you own is an entitlement to stock held for you by your broker. But your broker doesn't own the stock either. What your broker owns is an entitlement to stock held for it by Cede & Co., which is a nominee of the Depository Trust Company, which is a company that is in the business of owning everyone's stock for them. """
https://www.bloomberg.com/opinion/articles/2015-07-14/banks-...
Also: https://bitsonblocks.net/2019/02/07/who-legally-owns-all-the... compiles similar information on Singapore and Hongkong (googled - not verified).
The analogy I like to use is what's harder to buy a $1 million house or $1 million of Microsoft stock? The former process takes weeks, and dozens of man hours from lawyers, realtors, escrow agents, bankers, county property registrars, etc. Whereas a buy order to execute Microsoft shares happens in microseconds. That's because we've built a highly streamlined autonomous system for executing stock transactions. Yes of course, there's a trusted layer built on courts and fiat law at the bottom. And occasionally for a corner case, real lawyers have to get involved. But the vast majority of the time, this layer is completely abstracted away and trading stocks are just bits flipped on a computer.
When somebody says something like "let's put houses on the blockchain", the idea isn't to get rid of the fiat law system completely. At the end of the day, you still need courts and sheriffs to enforce property rights. But the idea is that we can wrap the house in an LLC, whose bylaws state that it's governed by on-chain contracts. (Which Delaware Chancery courts will absolutely recognize and enforce.)
Now instead of directly transacting at the very low-tech county property registrar we can transact using an on-chain NFT that grants the equivalent of ownership rights to the house. (This is very analogous to how Cede & Co technically owns almost all the stock shares in America, and holds them under your name for you.)
That NFT is way more powerful and efficient to transact with than the county property record. It lives on a credibly neutral level that already has billions in native capital and liquidity and exposes a fully Turing complete smart contract system. You can sell your house atomically and instantly to anyone in the world with no lawyers or escrow agents. You can pledge it as collateral and borrow against it. You can fractionalize it and sell a portion. Or roll it into a larger portfolio and slice into tranches. All with no more than few dozen lines of code. Without blockchains all of those operations would take hundreds of pages of legal documents and weeks of back and forth.