The real estate industry is in urgent need of an organized, structured, secure and efficient data management system that would enable investors and brokers worldwide to rely on a comprehensive real-time database. Propy, a California-based Blockchain startup, intends to simplify real estate sales for both brokers and consumers using Blockchain.
Propy is currently available in Dubai, New York, San Francisco, Los Angeles, Miami and Moscow. In these cities, consumers can purchase real estate properties by establishing a connection with a real estate broker on a Blockchain-based platform.
Specifically, the Propy development team utilizes the Ethereum network, the only stable Blockchain network based on smart contract settlement, to replicate the process of real estate transactions. One of the key differences between conventional real estate transactions and Propy’s smart contract based settlement is that on the Propy platform, physical signatures are replaced with digital signatures.
The development team of Propy allocated a significant amount of time and effort in designing a smart contract system that innovatively combines solutions from legal, Blockchain and payments industries. By using Ethereum, Propy allows each party including the broker, buyer, seller and notary to obtain a private cryptographic key to sign off a transaction.
Smart contract real estate
In an interview with Cointelegraph, Propy’s Chief Blockchain Evangelist Andrey Zamovsky stated that the majority of developing countries globally suffer from a lack of proper and robust electronic property registry. Some countries that have a digitalized registry struggle to deal with hacks and data manipulation, ultimately leading to corruption and fraud.
Thus Zamovsky noted that a Blockchain-based immutable real estate platform is necessary to ensure that corruption resulting from data manipulation is prevented. More importantly, the lack of sophisticated and secure registry systems also makes the verification process difficult for brokers, especially if land ownership is transferred to others.
To avoid potential data mismanagement and fraudulent settlement of registry, government agencies or the recording office often take 4 to 6 weeks to verify executive ownership transfers, this is inefficient and time-consuming for investors.
“A lot of developing countries still don't have any kind of electronic property registry or have very inefficient ones - vulnerable to corruption, physical damage, hack attacks and fraud. The Blockchain database is replicated on thousands of servers worldwide, so it will be close to impossible to lose registry data.”
Ethereum hard forks and security
Natalie Karayaneva, CEO at Propy and managing owner at real estate development firm MP Group, addressed the series of Ethereum hard forks that were released and executed over the past 6 months.
While Karayaneva understands and acknowledges the community’s frustration with Ethereum and the development team’s struggles in dealing with external attacks and internal issues, she states that these hard forks ultimately help the Ethereum network to mature and become resilient to similar hacking attacks in the future.
Furthermore, Propy offers additional security layers for its platform particularly for transactions and smart contract settlement. Thus, the Propy platform demonstrates strong security measures for all parties involved.
“We are using Ethereum as it is the most stable Blockchain with smart contracts out there today. It may sound controversial, as it angered the Blockchain community by doing a number of hard forks recently, but we believe that each hard fork actually makes the system more mature and the rest of the smart contract platforms is still yet to go through similar issues,” said Karayeneva.