To start off the year, I thought I would talk about something pretty geeky, but very forward looking: Bitcoin.
I wrote about Bitcoin just over a year ago when I was first starting to wrap my head around it, but a lot has happened since then. Many of you might know that 2014 was a terrible year for Bitcoin and that its price has declined significantly (chart from Coinbase):
But does that mean Bitcoin is a flop, or that the hype has just died down a bit?
If you follow what’s being discussed within the tech community, you’ll know that there are still lots of people who are bullish on Bitcoin. But more precisely, they are bullish on the underlying architecture behind Bitcoin and something that is called the Blockchain.
I’m not going to get too technical in this post (if you want that,
This morning I was at Toronto City Hall looking for old drawings of a building that I’m now working on. While I was there, I also ran into John Tory, and so I was given the opportunity to congratulate him in person on his recent mayoral win. But that’s irrelevant to this discussion.
What I instead want to talk about is access to information.
But a lot of that information isn’t all that useful and much of the really useful information that’s out there isn’t yet digitally accessible in the ways that we have now become accustomed to. For example, for me to access old drawings and documents for a building in Toronto, I had to do the following…
First, I had to file what’s called an Application for Routine Disclosure. It was a 2-page form that I was able to submit to the city over email. The fee for this application was $66.60. Once the city confirmed receipt of this application, they then went looking in their archives for any drawings and documents that might exist.
The New York Times has an interesting article up talking about the possible impacts of climate change on coastal real estate in the United States. In it they make the argument that sales velocity is declining in flood-prone areas. Here are two snippets:
Over the past five years, home sales in flood-prone areas grew about 25 percent less quickly than in counties that do not typically flood, according to county-by-county data from Attom Data Solutions, the parent company of RealtyTrac. Many coastal residents are rethinking their investments and heading for safer ground.
In the past year, home sales have increased 2.6 percent nationally, but have dropped about 7.6 percent in high-risk flood zones in Miami-Dade County, according to housing data. Many coastal cities are taking steps toward mitigation, digging runoff tunnels, elevating roads and building detention ponds.
I would like to see more data supporting this argument, but I can’t say I’m surprised. Flood risk is certainly something I would think about – particularly in high-risk areas such as South Florida. Florida has 6 of the 10 most vulnerable urban centers in the US.
The other piece that caught my attention is this:
Flood risks are easily overlooked because past flood damage often goes unreported and, as in Virginia, the burden of discovering it falls to the buyer. LexisNexis, a news and legal research company, can supply sellers a report with the history of flood claims on the property, but buyers usually do not know to ask for it. FEMA collects information on federal insurance claims for homes nationally, but the agency has been reluctant to make it public for privacy reasons.
It is yet another example of how opaque the real estate industry is. A lot of the information – assuming it’s even available – is fragmented across a number of different sources. If you’re playing hot potato, this obviously works to your benefit. But I don’t believe it’s the best thing for the overall market.
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), but I do want to talk about three things (that I’ve mostly learned from the folks over at
): the Blockchain, why it matters, and what it could mean for specific industries such as transportation and real estate. I promise to make it relevant at the end.
The way to think about all of this is in layers.
The Blockchain is the foundation or base of Bitcoin. It’s essentially a decentralized public ledger that keeps track of all the Bitcoin transactions. Decentralized means that not one single person or company owns the database. It’s free for anyone and everyone to see. This structure is important because it enables peer-to-peer transactions across the internet, as opposed to going through a bank or other intermediary.
But the key takeaway is that Bitcoin is simply one example of a “protocol” built on top of the Blockchain. And there are many others in the works, including a protocol for realtime ride sharing (Lazooz) and a protocol for a decentralized peer-to-peer marketplace (OpenBazaar). And so the real innovation is the Blockchain, not Bitcoin itself.
Why does this matter?
It matters because these protocols are, again, not owned by a single entity, which is remarkably different than the way most things work today. Take for example the residential real estate industry. In the Greater Toronto Area, the data that emerges from home listings and sales is owned by the Toronto Real Estate Board.
And since this data is privately owned, a lot of it remains only accessible to “members” or real estate agents. The Competition Bureau has been fighting for more openness, but the Toronto Real Estate Board obviously wants to keep as much of this data as it can to itself. Who can blame them.
But what if somebody came along and created a new protocol for a decentralized peer-to-peer home marketplace? In that case no one would own the data, which means everyone would have access to it. And that would completely change the landscape. I’m fuzzy on what this protocol would even look like, but it seems entirely possible given what else is in the works.
And if this Bitcoin Blockchain revolution does actually take place, it wouldn’t be restricted to only non-tech legacy industries. Joel Monegro of Union Square Ventures believes that “decentralized protocols” such as Lazooz and OpenBazaar (mentioned above) could even have a big impact on companies such as Uber and eBay, respectively.
I’m still trying to wrap my head around all of this, but I want to understand it and I thought you all might as well. Because even though it seems very tech right now, the implications would also be very non-tech if it turns out to be true.
After about a week, I called them up and they informed me that drawings had been found and I could now setup an appointment between the hours of 8:30am and 11:30am, Monday to Friday. I went in the next day and the lady – who was very helpful I must say – presented me with a stack of microfiche sheets (I think that’s what they’re called).
I then took these sheets and walked over to a machine (shown below) where I could inspect the drawings. Everything about the machine had to be reversed. In order to get the drawings to show up properly, I had to put the microfiche sheets in upside down and mirrored left-to-right.
As I looked through the sheets, I was then instructed to demarcate – with a post-it note – which drawings I wanted a copy of. At the end of it all, the lady filled out another form that would be sent to a printing shop who would then convert these microfiche drawings into PDF files for me. I think that will end up costing a few hundred dollars when it’s all said and done.
However, at this point, I also learned that this procedure applied only to drawings, and not to any of the other documents that I was able to find on the microfiche sheets. For non-drawing documents, I actually had to file what’s called a Freedom of Information application at a separate counter upstairs. So I did that. I applied to free the information. It was only $5, but the turnaround time for that is 30 days.
Now, I realize that we’re talking about old drawings and documents. Some of them were from the 1940s. But I’m a big believer in the value of open information. And so today was a good reminder to me that, even though we now have a tremendous amount of useful information at our fingertips, there’s still lots of valuable information that’s really difficult to get.
