Real estate blockchain Ubitquity LLC recently launched its platform prototype for secure document storage and integration with the title insurance industry and county clerks within the United States. The system uses Colu's implementation of Coloured Coins to manage digital assets on the Bitcoin blockchain.
Nathan Wosnack, co-founder and CEO said using a blockchain will dramatically reduce risks in every step of documentation. He told IBTimes UK: "Fraudulent conveyance costs the industry approximately $1bn (£700m) a year in the US alone. Much of that comes from financial institutions issuing loans or mortgages to bad actors who are perceived to be the rightful owner to the land. Shared immutable ledgers allow for greater collaboration between industry players and a potential reduction in fraud."
Wosnack said the blockchain-powered platform will improve due diligence for the industry. "As part of due diligence, title companies have to research properties in order to ensure the chain of title is clear.
"Due diligence is in some cases a very-time consuming and arduous process. It can be done quicker and easier with a shared public ledger platform like Ubitquity; particularly for smaller title companies and financial institutions. Title companies can issue a 'certificate of clear title' on the blockchain by signing a title record with their own private key.
"The banks will also benefit from a reduced title search time, increased confidence in the deeds history, and process transparency over a public blockchain. Lenders will have the ability to publish and track their deeds of trusts (liens) to a particular property directly on the blockchain."
Wosnack said each county recorder has different regulations by which they must abide. "We are in contact and aim to work with them to ensure full legal compliance with government regulations in the respective jurisdictions.
The benefit of using a public ledger for real-estate title and deeds records is it allows anyone to browse those records. Public keys can be made public, so that trustworthy organisations (county offices, banks, title companies) can attach their trusted brands to specific title records, said Wosnack
Wosnack chose Colu because "Colored Coins is a protocol that, in the future, could be implemented on other blockchains like Ethereum. The Bitcoin blockchain is, today, the most reliable and secure blockchain in existence. The Colored Coins API implemented by Colu is very complete and supports many of the features we need, including smart assets, multi-signature, and smart contracts support. The protocol also provides the ability to decentralise large amount of metadata and file attachments using Torrents."
Ubiquity is working a number of companies in the space, under NDA, and said it is inviting select financial institutions, title companies, and others within the private sector for an exclusive demo/presentation of its platform.