Predictions say blockchain-enabled lease contracts will arrive in 2022
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Predictions say blockchain-enabled lease contracts will arrive in 2022 25 May 2018London Reporter: Maddie Saghir
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Real estate investors have predicted that blockchain-enabled lease contracts will arrive in 2022.
New research from BrickVest, the commercial real estate investment platform, found that six in 10 (61 percent) real estate investors expect the industry will adopt blockchain technology for transactions.
This is a 9 percent increase on 2016, and in contrast, just 18 percent of investors do not expect to see the future use of blockchain technology in property transactions.
On average, investors expect to see the first property lease contracts based on blockchain technology in 2022 but one in four (25 percent) predict that it will happen as early as 2020, the report says.
According to the report, the biggest obstacle to the introduction of blockchain is lack of knowledge and education into the benefits it brings, 62 percent of property investors said.
Additionally, 59 percent believed that the integration challenges with existing regulatory and legal frameworks are the biggest obstacle.
The report found that 45 percent of investors believe that there is reluctance among banks, insurers, and private equity firms to invest in the technology, while 41 percent cited the opposition by the financial gatekeepers such as notaries and trustees whose existence is threatened by blockchain.
Rafal Okniski, CTO at BrickVest, said: “When it comes to the eventual use blockchain in property deals, most real estate investors now see it as ‘when’ rather than ‘if’. There has been a lot of publicity about blockchain in the past two years so it’s no surprise that more investors expect to see its usage but for many in the industry it remains something of a mystery how it will be successfully introduced and widely adopted given the legal and regulatory complexities.”
He added: “We believe awareness and support of blockchain as a positive force among real estate investors is rapidly growing. Once it’s introduced, blockchain will revolutionise the market and bring greater transparency to what remains an opaque and old-fashioned sector.”
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