As of late December 2023, Bitcoin was up more than 60% in the prior four months while another well-known cryptocurrency, Solana, was up over 240%. The cryptocurrencies were on their annual Fall bull run, but there seems to be more to why they have jumped in value in the past several months. At least in my opinion, cryptocurrencies, blockchain, and related technologies and concepts are here to stay.
But this post, and the posts that follow, will not provide a primer or deep dive into cryptocurrency – at least not the direct investment potential of it. Rather, this series of four posts will discuss cryptocurrencies’ underlying blockchain technology that has the potential to revolutionize the way we buy, sell, and develop real property. By leveraging the benefits of blockchain technology, we can simplify, streamline, and make more transparent the real estate sales and development process for the benefit of property owners, developers, municipalities, and other stakeholders.
But first, let’s understand what blockchain technology is. At its core, a blockchain is a decentralized, digital ledger that records transactions. Each block in the chain contains a timestamp and a link to the previous block, creating a permanent and tamper-proof record of the transaction. By using cryptographic algorithms to validate and authenticate transactions, blockchain technology offers a high level of security and transparency. If you weren’t aware already, the “crypto” in “cryptocurrency” refers to cryptography (i.e., the enciphering and deciphering of messages in a cipher or code). If you are a fan of books or movies, cryptography might make you think of A Beautiful Mind, The Da Vinci Code, or The Imitation Game.
But the benefits of blockchain technology go beyond security and transparency. Because it operates without the need for intermediaries, blockchain technology can reduce transaction costs and processing times, making it an attractive option for real estate sales and development. In fact, blockchain technology is already being used in other industries. For example, in supply chain management, blockchain technology can be used to track the movement of goods from origin to destination, increasing transparency and reducing fraud. In healthcare, blockchain technology can be used to securely store and share patient data, improving patient outcomes.
Among other uses in real estate that will be discussed in the following posts, blockchains could replace our antiquated recording system for deeds, plans, mortgages, easements, and other documents. I hope you follow along as we explore how blockchain technology can be used to simplify the sale of property and streamline the development process in Pennsylvania.
In the meantime, if you have any questions about this post or any other land use questions, please contact one of the members of the McNees Wallace and Nurick Land Use Group for assistance.