UPRETS SHARE | Blockchain Application Trend — Real Estate Industry Research Part 2
Blockchain Application Trend — Real Estate Industry Research
Xun Shuo, Ke Yan
（XIN Real Estate Fintech Research Center）
On October 24, 2019, the Political Bureau of the CPC Central Committee held its 18th collective study on “Current Status and Trend of Blockchain Technology Development”. Xi Jinping, general secretary of the CPC Central Committee, stressed during his study that the integrated application of blockchain technology plays an important role in new technological innovation and industrial transformation. He took blockchain as an important breakthrough for independent innovation of core technologies and accelerated the development of blockchain technology and industrial innovation. However, in the Notice on the 13th Five-Year Plan for National Informatization issued by the State Council in 2018, it is proposed to actively construct and perfect the blockchain standard system, accelerate the development and application of key standards, and gradually construct a perfect standard system. After the “blockchain” was included in the “13th Five-Year Plan”, its national strategic position in science and technology was once again elevated, ushering in a period of development opportunities.
Deloitte’s 2019 Global Blockchain Survey released by Deloitte has covered 1,386 senior managers in the blockchain industry in Britain, the United States, China, Germany and other countries. Thereinto, 53% of the interviewees regard the blockchain as their development priority in 2019, up 10% from last year. A total of 84% of the interviewees believe that the blockchain will eventually become the mainstream technology, up from 74% last year, and the proportion of projects with an investment of 5 million or more in the blockchain industry is stable at 40% in the next 12 months.
I. Background Introduction
1.1 Introduction of Blockchain Technology
What is blockchain technology? What are its advantages and characteristics? Different from the traditional centralized data storage mode, the blockchain can be understood as a chain distributed database that connects data blocks in chronological order (as shown in Fig. 1). Blockchain is essentially a distributed account book database, which was first proposed by Satoshi Nakamoto in his paper Bitcoin: A Peer-to-Peer Electronic Cash System. A complete blockchain system is based on many technologies including cryptography, mathematics, computer science, etc. Among them are data books for storing data, digital signatures and timestamps for verifying encryption, consensus algorithms for network and maintenance systems as basic supports, mining and workload proof mechanisms, anonymous transaction mechanisms and bitcoin wallets, hash functions, Merkle Tree and other related concepts. It is these technologies that ensure that the blockchain can realize the functions of transaction, verification, tracing and linking on the non-centralized network.
At first, blockchain was well known as the basic technology supporting bitcoin, but blockchain is not equivalent to bitcoin or other derived digital cash, but as an infrastructure, it is a science and technology that can be explored and researched like Internet and artificial intelligence technology.
Fig. 1 Blockchain Diagram
1.2 Development Process and Industry Application
Looking back on the development process of the blockchain, the 2018 White Paper on China’s Blockchain Industry released by the Ministry of Industry and Information Technology shows that 456 companies were officially registered in China as of March 2018 with blockchain or service as their main business. On the whole, the size of the company is relatively small, and the number of enterprises dedicated to real economy and financial services has developed relatively fast (as shown in Fig. 2), which also reflects that the domestic blockchain is mostly “blockchain+scene”. On the other hand, in 2018, there are relatively few companies specializing in hardware manufacturing, computing technology and research and development of underlying technologies, and the research and development investment needs to be improved.
Fig. 2 Number Distribution of Blockchain Enterprises
Source: 2018 White Paper on China’s Blockchain Products
From the perspective of intellectual property rights in technology research and development, according to statistics from the State Intellectual Property Office, as of March 31, 2019, China had 4,351 blockchain patents, 2041 patents in the first quarter of 2019 and 317 patents in the same period in 2018. From the point of technology distribution, payment system, digital information transmission, digital data processing and accounting registration devices are the main ones. It can be seen that the development and innovation of blockchain technology entered a new stage in 2019, and domestic attention was gradually paid to its technology research and development and intellectual property application.
From the application field, transaction payment, administration, data transmission and storage are the main application directions. DCEP is accelerating its launch. The Bank of China recently completed its international remittance business based on the blockchain payment system. Local governments at all levels are also applying the blockchain industry. For example, Zhejiang Province has established the country’s first blockchain electronic medical bill platform. Medical bills are linked up. Data can be traced and cannot be tampered with from generation, transmission, storage to use, thus ensuring the authenticity and uniqueness of bills. In addition to Zhejiang, 14 provinces and cities, including Beijing, Shanghai, Shandong, Shaanxi, Hebei and Guangdong, are experimenting with blockchain+government service to open up data information sharing within the government service system and external data disclosure of the service system so as to realize cross-level and cross-department data sharing and interoperability.
In fact, the blockchain has long been applied to the real estate industry. In November this year, Haidian District of Beijing used the blockchain to register and transfer real estate. Based on this technology, a real estate ownership system was built to make the whole transaction process more transparent and fairer. In 2018, Hebei Xiongan New Area also established a rental application platform based on blockchain, while in 2017, Xiong’an also launched a blockchain asset management platform to realize an automatic trigger mechanism for intelligent contracts to guarantee builders’ payment. From the perspective of the international market, Arizona replaces traditional property ownership and transaction records based on the blockchain. Dubai handles and executes real estate transactions and lease registration on the blockchain, thus achieving better traceability and transparency. The British government has launched the Digital Street Project and plans to transfer all information from the Land Registry to the blockchain by 2022.
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