Earlier today a friend of mine sent me this Fast Company article talking about bitcoin and the future of home buying. I’m really glad he did. Both because I wasn’t yet sure what I was going to write about today and because this is a topic that I’m deeply interested in.
I recently heard Brad Burnham (venture capitalist at Union Square Ventures) say in a talk that if you’re thinking about Bitcoin just as a currency, then you’re thinking about it in the wrong way. If you take nothing else away from today’s post, I think you should remember that. Bitcoin, and the underlying block chain architecture, have the potential to be very transformative.
The Fast Company article was written by Matt Weiss of IDEO (the powerhouse design and innovation firm). Here’s an introductory snippet:
Insert block chains: a relatively new and promising technology that could transform the way we digitally exchange value, similarly to how Internet protocols, like TCP/IP, transformed the way we exchanged information. For example, to transfer ownership of a home today, there are countless check of authenticity and intermediaries involved to insure the transfer is legitimate. By using a distributed database (a.k.a. “a block chain,” the same technology behind Bitcoin) to prove authenticity, we could legitimately transfer ownership immediately without the need of a middleman. In fact, when we think about block-chain technology and the industries it could disrupt, real estate tops the list. While Trulia, Redfin, Angie’s List and others have brought some transparency to the opaque world of home buying and home ownership, most of our experiences in this industry are fraught with incomplete, inaccurate, and asymmetric information.
Following this, he goes on to talk about what it might be like – each step of the way – to buy a house using the block chain technology. There are even mockups of what the app could look like. I highly recommend you give it a read if you’re interested or involved in this space.
The real estate industry hasn’t seen a lot of innovation. It remains an opaque market with lots of information asymmetries. I have no doubt that will one day change; it’s just a question of when. Perhaps it’ll be the block chain that makes that happen.
Image: IDEO via Fast Company