Blockchain Uses in the Auto and Real Estate Industries
More often than not, the term ‘blockchain technology’ directs one’s thoughts toward cryptocurrencies like Bitcoin. But as the growing body of innovation shows, cryptocurrencies are just a fragment of the uses to which blockchain technology can be applied. In fact, various commentators – experts and novices alike – believe that blockchain could transform just about every sphere of life, from health care to education, financial services to the media as we know it today. It’s easy to see why. Every day, new and innovative uses are found for Blockchain technology.
Blockchain, as I previously mentioned is a ledger of transactions that’s validated by a network of users (as opposed to a single central authority such as a government), and serves to confirm to the rest of the network that a transaction has taken place.
Blockchain and the Auto and real estate industries
A car and a home. More often than not, those are two main assess that we all aim to acquire as soon as we leave home and become independent. Could Blockchain make the process of accessing them easier? Or at least different? Yes. In this post, we take a look at what impact, if any, Blockchain could have on the auto industry and on housing.
1. The Auto Industry
The auto industry is booming alright, and the demand for vehicles is soaring. But for many, the process of buying a car is tedious, slow, expensive and time wasting. Blockchain could help transform this as it has a myriad of uses to the industry. For example, the process of certifying a used car as being road worthy before buying it. This is one of the most important aspects of buying a used car, and when all of the details concerning the life of that car is stored as data anchored on blockchain technology, it then becomes easy to certify most aspects of the vehicle, such as its servicing history, financing, accidents etc.
From the manufacturer or retailer’s perspective, blockchain would, of course, be useful for building relationships with customers, suppliers and OEMs since the system eliminates intermediaries and middlemen. Other ways in which blockchain is useful to the auto industry include:
- Full sight from concept to completion: When the Vehicle Identification number (VIN) is aligned to blockchain, the car development process is rendered more transparent. A customer may place an order for the manufacture of a particular type of vehicle, and through blockchain, monitor its development till completion. Even with non‑custom vehicles, that element of transparency is beneficial as all interested parties can access every detail they need because of the open‑ledger style of blockchain.
- Management of vehicle software: If a car manufacturer gives its customers the ability to download software Apps to their vehicles, a blockchain‑based system would mean that the manufacturer can save to the car’s blockchain ledger, complete information about the vehicle, including software versions and packages which have been installed to the vehicle, and make it possible for him to charge his customers per each transaction. New revenue channels would thus be created to car manufacturers through the sale of other services, software and usage tracked.
- Mobility Profiles: A customer who subscribes to the use of a vehicle from a manufacturer would be helped by the blockchain system to transfer with ease their mobility profile which may include seat setting preferences, entertainment, navigation and climate.
None of this is beyond the realm of possibility. In fact, the auto industry is already reaping the benefits of blockchain.
2. Real Estate Transformation
Similarly, blockchain is already transforming the real estate sector, particularly from a process‑simplification perspective. In many countries, the real estate industry is characterized by opaqueness and very long processes required to close a deal. This is because real estate transactions usually involve a large number of interested parties, such as the seller, the buyer, estate agents, lawyers, mortgage providers and the land registry office. With such a long list of stakeholders, it’s no wonder transactions are often fraught with delays, mistrust and even errors.
With blockchain, many of the third-party intermediaries can be eliminated, ensuring a more seamless, fast and accurate process.
- Transparency: Smart contracts – a blockchain technology that consists of an algorithm that stores terms of agreements and automatically executes those terms – is particularly useful in real estate transactions. Because of its ability to automatically validate when a condition precedent has been met, the next step in each process of a real estate transaction can move on seamlessly, without unnecessary delays. For example a buyers offer can be automatically accepted once conditions put in place have been met. With the adoption of blockchain’s smart contract, no transaction step is skipped and money is automatically released upon fulfilment of the smart contract terms. The distributed nature of blockchain shifts the source of information from the lawyer to blockchain’s public ledgers which are accessible to all participants.
- Reduction of costs: Blockchain reduces transactions costs as middlemen are eliminated and lots of extra fees normally demanded by intermediaries are saved. Processes such as legal documentation, listing and payments are carried out through a blockchain platform.
- Reducing fraud: Fraudulent transactions are rampant in the real estate business. Technology has made the forgery of documents and fake advertisement of property even more rampant. Blockchain seals all loopholes to fraud by creating and issuing digitized ownership certificates which are nearly impossible to replicate. Each digital certificate is paired with one property in the blockchain system, making forging of ownership documents almost impossible to occur.
As remarkable as these benefits are, it is highly likely that they are but a drop in the ocean in terms of what blockchain technology will make possible in both the auto and real estate industries. We live in exciting times indeed!
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