Join us for the recap of the ChainLeak podcast hosted by Joshuwa Roomsburg, where our CEO, Rick Schmitz, shared his insights about our Blockchain Land Registry Software, commonly known as goLand. Get ready to delve into the transformative potential of blockchain technology in revolutionizing land ownership and reimagining the future of property registries.
QUESTIONS AND RESPONSES.
Today's episode is about blockchain land registry. Could you give us a breakdown of what that means?
“We use blockchain and immutability to prove you own a piece of land. Nobody can change that; there's no way to alter it. If you want to transfer that land to somebody else, you can do that, but only permitted by you because you hold the private keys. So, if the government falls or a natural disaster occurs, you can always prove that you were the rightful owner of that piece of land without any government interference. You can always replay the events that happened on the chain and show that you're the owner of the piece of land or the house you're living in. That is basically what the land registry is.”
The way you just explained that, if the country were to fall, you would still be able to verify that you were the owner of that land, now that's all based on the blockchain itself?
“Well, if you can prove that a certain event has happened, first, you start with the distribution of land, right? So, you issue a piece of land to somebody's private key. Now you see that this transaction happened, and it was signed with a specific private key. The transaction is on the chain, and that transaction is the issuance of land for which someone paid X amount. You can put all that data on-chain, and then, let's say, the current government falls. A new power takes over, and all the previous land records (e.g., physical or on centralized servers) get destroyed, so there are no records at all anymore. But let's say that the original government comes back after the new power has been defeated again. You can still prove in a blockchain that you were the owner of that land because it was issued and you signed it with your private key, and you can always find the corresponding transaction, even if the land was transferred to somebody else. You can then go, like, hey, the person that claims that the land is now his; that’s not true because you can show the transactions in the chain before the new power took over. We can always retrace the events, and you can be certain of its accuracy.”
So, do you have the ability to do aftermarket transactions as well?
“Yeah, of course, so if you issue the land, that's your Genesis transaction, right? And after that, you have multiple options for the land. It can be transferred, it can be split, or you can mortgage it; there are many things you can do with a piece of land, and those are all actions that are tied to a certain event.”
Would you have to go back to that third-party intermediary to conduct a transaction like that?
“That all depends on the laws there. For instance, in the Netherlands, it's not possible. You need to have a notary verify this transaction, but it might be much more fluent in other countries. The less regulation, let's say, like generally in Africa, it's possible to transfer without the interference of the third party, and that is, in my opinion, the way to go.”
So, in theory, a person could sell a plot of land for, say, two hundred thousand dollars. Is it specific to the LTO network so they would receive LTO, or could they do the transaction and receive, say, Bitcoin?
“Well, you can do it in USDT. Also, it's basically about you connecting the smart contract to the LTO chain, where you say, okay, we're going to transfer this land if the Bitcoin or the USDT is received by the wallet of the guy who's transferring the land to the other guy for two hundred thousand dollars.”
Do you guys have a user or a business interface for this type of technology?
“Yeah, that's necessary. If you don't have an interface, people are not able to use it. So yeah, we created this [land registry] with the United Nations. We did that for Afghanistan. We set up the project with the government there, the land ministry. Unfortunately, as everybody knows, the Taliban took over from the local government there, so the UN needed to pull out. But we're working with African countries now, and it's making a lot of progress. The good thing about this is that we already developed the interface with the UN for Afghanistan, so we knew what needed to be in there. We also already knew what the demands are when you're talking about the land registration system.”
You've created the groundwork for the infrastructure. Now, are there other digital currencies that are compatible with these types of transactions for the payment side? If the land registry deed stays on the LTO network, does your user interface give you the ability to pay with various currencies?
“Yeah, but the payments won't happen on the LTO chain because we don't do that. But you can tie in a smart contract where the conditions are fulfilled, such as a payment. That payment can be in crypto, or it can also be a bank transfer that needs to be verified. The verification is then the trigger for the transaction. There are multiple ways to do it. For example, in Afghanistan, there is still a lot of paperwork going from A to B in the current system, and the blockchain just creates an extra layer. A centralized system can be taken down, and that’s what happened in Afghanistan. The Taliban took it down and created their own stuff. But let's say that the government comes back after the Taliban are defeated again. Then you're able to replay the transactions that happened on the LTO blockchain. You can say: Hey, you remember that system that you implemented and that was taken down by the Taliban? These are the transactions that have happened on the LTO blockchain and are pushed in through your system. Let's replay them, and then you can see I'm the rightful owner of this piece of land.”
Now, when you think about the traditional land registry services, what are some of the challenges with the old infrastructure?
“I would say that's Legacy. So, the old systems came into place, especially in Europe, when IT started to get big. When banks started to use IT, the governments and land registration systems also started to use IT. These IT products are extremely old, and we have been building on top and on top of them. We're talking about Cobalt infrastructures. So this is old technology which makes it hard to add new things and change how they work. Also, if there is no dispute about a piece of land, what is the added value that blockchain brings? Like in the Netherlands, there are not really disputes about transactions of land. That never happened, not even in the last 20 years. So I would say the added value of blockchain technology is not so much unless you change the rules where you say, okay, we don't need a third party, like a notary anymore, to transfer a deed from A to B. If we do that, then you need blockchain. But if you're still going to keep it the old way, and there's no problem with trust, then there's no point in implementing blockchain. So I don't think Europe is the market to go to for these kinds of systems. It's where there is no trust in the government or less trust, like in some African countries. So Africa is a sweet spot for us.”
When you think about blockchain being a game changer for this type of Technology, what would be, if you could give me a list of two or three different things that will hold you back from approaching a country with this technology, what would be two or three reasons why you wouldn't approach a country?
“I would always do it with a local partner. That's the highest priority for me. If we don't have a local player there, it is, unfortunately, impossible to do business, especially because there is a lot of bribing, and everybody wants to have a piece of the pie. It's like doing business 100 years ago in Europe. There is more corruption and a lot of red tape everywhere. I think that is the main concern. Also, what is needed is the openness for a country to change. Or if there's no system or just a basic system in place, then it's also a target country for us to see if they are willing to work with something new. And we get our leads through the UN, so that's an advantage. They know which countries are the best to approach, and we do that together.”
Now another thing is, what are some other real-world examples of this type of technology? We talk about land registry. Have you guys branched into anything else on-chain?
“Yeah, digital identity and Ownables. Those are our main on-chain products. Like the verifiable credentials, these play a really big part. The identity space is going to change; the way we verify online at the moment is absolutely terrible. There is no good way to verify that you are actually you when you do stuff online. If you want to verify yourself, it takes something like a KYC process, for instance. It is a headache. You need to send in proof of address; that's a copy of your bank statement. You need to send in your passport. You need to send in selfies. That's all not smooth and not a good user experience, in my opinion. If you have a wallet that trusted third parties have verified, you should be able to interact and basically do anything online with those credentials, from opening bank accounts to buying a beer online, proving that you're 18. So basically, that is going to change, and it’s going to happen rapidly. Also, in Europe, companies need to have a product passport. So the passporting of products is also going to start. This is an obligation for 2025 or 2026, I think. A lot is going to change, and blockchain is very well suited for this.”
You spoke about Africa earlier. Are there any other countries you're looking at to implement this type of technology?
“Africa is big, there are many countries in Africa, but there is South America, where this is also relevant. And they’re pretty open to blockchain technology in South America, so that is definitely another target area for us. But, for example, it’s way harder to implement in Asia just because doing business in Asia is not so simple.”
Have you guys looked into trying to put something together for Venezuela?
“We didn't try to do anything for Venezuela yet. Also, we don't have connections to get to them. So if you have those connections or anybody reading, send them over because I would love to talk to Venezuela, and they're also pretty open-minded about blockchain.”
Now, another thing with the land registry software, could you give our listeners a walk-through of how they would potentially put land on-chain?
“Yeah, sure. So the government offices identify a piece of land. When this has been done, they map with an overlay. Afterward, the coordinates of the boundaries are added to this, and then the registration is submitted. In the last step, the land is issued to the person who is entitled to it.”
So, if I owned a piece of land, would I go to the state or the country? Who would I approach to make the registration happen?
It depends on which country you go to, right? When we did the Afghanistan project, the whole of Kabul was rastered out. Everything was cut to pieces all over again because nobody knew who was living where. Then the re-issuance started. So people were given a certificate for the land that belonged to them if they could prove ownership. But then we made the system with the UN, we put LTO Network blockchain under it, and then the certificate was issued, with the credentials of the certificate on-chain, so they could prove that that piece of land with those coordinates was theirs, even when you take out the local system. Because of the Taliban, the system is now down, so nothing happens on that system anymore, but the blockchain transactions and the data are still there. So let's say the original government comes back, then all these records can be replayed, and you can actually prove that that land was originally issued to you.”
Could you give us a breakdown of the impact on developing regions, such as Zimbabwe or Venezuela?
Yeah, aside from the problems with corruption, disputes, and stuff like that, having a land registration office is expensive. It’s a big information challenge for governments as well. So developing countries could spend their human and financial resources better, and let's say, bring education and support the health care systems, communities, and citizens, instead of creating these red tape kinds of transactions when we can do this so much more efficiently with our technology. I would say that is the perfect impact on developing regions.”
What does it take to get the right rules and oversight in line to implement blockchain land registry within a country? Is that something where you have to sit down with the leaders of that country and go over? Do you ask, “What do you guys need us to do”? Or do you already have the game plan and go like “This is what we need you guys to enforce on your end”?
“It definitely goes a little bit differently. It usually goes like this: the UN talks with the country that wants to implement something new or wants to use blockchain. Then there's always a local team that runs the applications already in place there. Every country has a document repository. Even in the smallest country and the poorest country in Africa, they have a document repository system. That's basically where they file the paperwork. So there is something that is a basic land registration system. A document repository system where the deeds go into, and the transfers are submitted to. If this is the basis, we can start adding blockchain and applications to make the system more efficient and trustworthy. We can start by adding the hashes of the documents that are being uploaded to the repository system. By hashing them and placing them in the LTO blockchain, we are already adding proof of the existence of a document; super-efficient and extremely easy to make. This kind of implementation is only a matter of hours; it’s that simple. Then you can go from there. We’re basically collaborating with the local government and the parties that run the current software applications.”
The Blockchain Land Registry podcast's recap has shed light on blockchain technology's groundbreaking potential in transforming land ownership.
Through the valuable insights shared by Rick Schmitz, we have discovered how decentralized land registries can foster transparency, reduce fraud, and unlock new opportunities for economic growth. As we envision a future where blockchain revolutionizes the real estate industry, we embrace this transformative power and embark on a path toward a more efficient and equitable system of property ownership.
A huge thank you to Joshuwa Roomsburg for hosting this awesome podcast!
About LTO Network.
LTO Network is Europe's most advanced blockchain - fully decentralized and highly efficient. It is already being used worldwide by businesses, governments, institutions like the UN, the Dutch government, and more.
The network offers several technologies to provide solutions for decentralized data security, digital identities, privacy, and the ownership of digital assets and digital collectibles.