Hacker News Reader

Comment by paulgb | Hacker News Reader

> Land registration on blockchain is not exciting enough to keep making the news but it's being slowly implemented around the world since before the pandemic cryptocurrency bubble.

I've been able to find references to pilot programs in Sweden, Ukraine, and Georgia (the country), but is there anywhere that's actually adopted it such that a blockchain-based registry has the same force of law that a traditional registry has?

I'm particularly curious how a registry would handle an “I lost my private key” scenario. As I see it, either the blockchain is absolute and losing keys would mean losing the land, or there's another authority who can override the blockchain's version of the truth. In the latter case, it kind of obliterates the advantages of a blockchain.

View on HN

The non-fungibleness of land requires a central authority to agree to ownership. It may live on chain but if the state does not consider the chain to be the source of record, it's useless. This is why armies exist.

If a blockchain has the highest legal authority, there’s no way I’d use it for anything worth more than $1K or so.

> I'm particularly curious how a registry would handle an “I lost my private key” scenario

You can probably solve this with multiple signature wallets. So you have some relationship with custodians where none of them independently can transfer ownership but a certain number of them would be required to do so. These custodians could be contractually obligated to act on your behalf. They can have their own policies for verifying ownership. It's more decentralized than our current system and courts could still play a role in disputes.

You have the issue today where ownership is difficult to determine ownership. You can tell how broken the system is when you have to pay title insurance regardless of the strength of your claim today in all (?) states. And the fee is 0.5% to 1% which is considerable. Some states even impose a minimum fee for title insurance and only allow a handful of politically connected insurance providers to offer this product.

Of course politicians wouldn't like this solution because the companies already in the system don't want efficiencies and lower costs and they contribute to campaigns. While homeowners don't feel that strongly since although considerable when buying or selling a home, it not top of mind or a frequent occurrence.

Just FYI you don't actually have to purchase title insurance. Your lender will require you to purchase it on their behalf, but if you are buying property without a lender there is no requirement to have a policy.

Your title/escrow representative will definitely throw a bunch of FUD at you if you decline to purchase though, cause it's a very profitable product for them.

Years ago I read an article in The Economist about problems with land registries in some third-world countries. It was easy for rich people to bribe the registrar to alter records. Poor people who owned land suddenly wouldn't own it anymore, and couldn't prove otherwise.

A blockchain-based registry would prevent such forgery. A master key holder could change ownership, but not without a visible record of the change.

In such unstable countries militia can just take your land, and not care what some blockchain says.

And if land ownership was actually enforced based on cryptographic proof, then this attack would work even better: https://xkcd.com/538/

Blockchains are also perfect for hacking: use someone like NGO’s spyware package or bribe their maid, and the blockchain community will line up to say it was the victim’s fault and there’s no way the community can do anything but recognize the thief as the legitimate owner.

The idea is not that people have their own keys to transfer ownership. The idea is for the registrar have the keys, but not be able to change ownership without public documentation. And there's a big gap between corrupt officials and roving militias.

Here are two more recent articles from The Economist, the first on the general problem (not all of which can be solved with a blockchain) and the second specifically on applying blockchains to the problem.

https://archive.md/9afqO

https://archive.md/yetMv

And if you don't mind a link from Reason, here's one with a specific example of the issue I'm talking about:

> Currently, Honduras stores its title records in a room at the bottom of "dusty stairs" in a "nasty old government building," Factom CEO Peter Kirby said in an interview last year with Reason. Until recently, the room had no door.

> "Anybody could go in, pull down a book, open up the spine, and replace a title record with a new title record," Kirby said. Some government bureaucrats have altered the records to assign themselves beachfront property.

https://reason.com/2016/04/30/bitfury-desoto-blockchain-land...

If the land registrar's venality can be exploited, what difference does blockchain make? Laws are enforced by people, not code.

The difference is that it can't be done in secret. And it's possible that the highest level of government would like to fix the problem, but has trouble with corruption at lower levels. Making corrupt transfers obvious would make them much easier to clean up.

In other words, you might as well ask "what difference do notarized documents make?" Anything we can do to establish reliable documentation helps the enforcers of property rights do their job. Blockchains provide reliable records even when you can't trust a critical mass of low-level human record keepers.

(And I'm not making this stuff up, see the links I posted in a cousin comment.)

> The difference is that it can't be done in secret.

Who cares? The record is entered by a government official. That's it. The land bow belongs to whoever is written the record. Blockchain doesn't help here at all.

There are also multiple other cases around land ownership that blockchain proponents don't consider because blockchain proponents en masse have no idea how reality works.

> it's possible that the highest level of government would like to fix the problem, but has trouble with corruption at lower levels

Ah yes. As always with blockchains, everything depends on some nebulous "possibly someone somewhere will perhaps do something, and the only reason they are not already doing it now is because they don't have blockchain"

It's actually not uncommon for high-level government officials to attempt to crack down on corruption at lower levels, and to have great difficulty succeeding. Blockchains are a reliable record-keeping tool that can help, much like double-entry bookkeeping helps authorities prevent other types of shenanigans. Unlike the skeptics here, I've provided reference supporting these claims.

But I suppose when double-entry bookkeeping was first introduced, it faced a lot of dismissive snark as well.

No, the snark is that you're talking about things as is good recordkeeping is some marvelous solution to problems.

Where I live the tax agency has no problem having transparent records of everything that happens. And yet tax evasion is an enormous problem. Recordkeeping is not the reason why people evade taxes and why they won't stop. Same thing with a violent police force or corrupt border police.

> Blockchains are a reliable record-keeping tool that can help

It's a computer system where you enter records. That's it. These poor high-level government officials that can't do anything could already have implemented/procured such a system without blockchain. They haven't.

But sure, they are only lacking blockchain to make this magically happen.

Edit:

> Unlike the skeptics here, I've provided reference supporting these claims.

If you refer to pilot projects using blockchain in some countries, these are nothing but scams looking for easy grant money, don't solve the actual problems (especially not in countries with bad record keeping), and can be implemented faster and more efficiently with any other tech.

As an example, this mini-thread on land registries in Afghanistan: https://twitter.com/dmitriid/status/1386994745218584580?s=20

Also this discussion: https://news.ycombinator.com/item?id=27212564

And this lower down: https://news.ycombinator.com/item?id=27217681

How's that for references?

More HN comments and a twitter thread? Eh, ok.

I wouldn't expect a comment containing any substance form anyone shilling for crypto.

Those comments have real problems that none of the blockchain "magic" can solve. And, of course, the moment actual real problems are discussed all the crypto shills just disappear into the thin air.

Sunlight is the best cure for corruption.

By putting registry data on the blockchain and allowing anyone to independently verify state of an immutable distributed database makes it much harder to get away with the corruption.

This isn't how things work in corrupt countries.

People here keep saying I don't understand "how things work" but so far nobody has provided references, while I've provided three links in support of my claims. Could you do the same?

In corrupt countries the laws don't matter two shits. What matters is what gets enforced. What matters is that the right cases go to the right courts. What matters is that people who press on these things get calls told to drop it, and if they don't drop it, they find themselves in accidents that no journalist is willing to touch with a ten-foot pole.

You're not going to find experiments quantifying this corruption; you'll find lived experiences and anecdotes coming from the same countries with the similar MOs.

Blockchains don't solve the problem of a police captain knocking at your door telling you that if don't go through with a shitty deal your son isn't coming back from school the next day.

Still no references then. I didn't ask for experiments; any decent journalism would suffice.

You're assuming the government is a monolithic entity, either corrupt or not. The truth is that often corruption is widespread but there are people at the top trying to fix it. That's not an easy task, and it's where keeping good, unforgeable records can help. That's why several governments are in fact running pilot blockchain programs.

> Still no references then. I didn't ask for experiments; any decent journalism would suffice.

Of course no references! Do you think even local journalists cover these things? Are you wrapped in a first-world bubble where you've never heard of local land rights being fought over? You've never met people from third-world countries willing to tell you about their fights with getting basic property rights enforces?

> You're assuming the government is a monolithic entity, either corrupt or not. The truth is that often corruption is widespread but there are people at the top trying to fix it.

I know enough governments officials in sufficiently high-enough places to know that there's people at the top who want to do the right thing.

> That's not an easy task, and it's where keeping good, unforgeable records can help.

This is where things are wrong. Where I live there's tons of illegal construction, disputed properties, and illegal sales. Recordkeeping has never been the issue; the issue is that legal disputes can take decades to settle with no particular recourse even for egregious lawbreaking.

Reply on news.ycombinator.com