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Same things that happens with Bitcoin, you lose your house.

Xeoncross 9y ago
Well, actually it just sits there forever and no one can use it. Think of this more like converting your home into a museum for future generations.
- usrusr 9y ago
  Why? If the transactions logged on the blockchain contain annotations about your identity, you (as described by those annotations) would still own the house, only an impersonator matching those annotations as good as you would be able to challenge your ownership. On a blockchain without any fallbacks you would lose any ability to ever transfer ownership. As for future generations, will anyone could claim it but your heirs might have a better shot at it than a random impersonator.
danpat 9y ago
That's apples and oranges. A house and land doesn't become inaccessible if a key is lost, and the gatekeeper of "ownership of land" isn't the mathematics of the blockchain, it's the government.
- paulgb 9y ago
  Well sure, but that seems to undermine the necessity of the blockchain for this purpose right? If the ultimate arbiter is still the government, decentralizing the ledger is neat but it doesn't remove the requirement for trust in the government.
  - smokeyj 9y ago
    Bitcoin has proven to be an effective ledger in regards to uptime, consistency and not getting hacked. The transaction fees are becoming higher but it's probably still cheaper than administering your own database that's potentially worth billions of dollars. Bitcoin is worth billions of dollars so I'd rather trust it to maintain my records than some municipalities IT guy.
    - drdrey 9y ago
      The protocol itself has not been hacked, but private keys get hacked all the time
      - smokeyj 9y ago
        This is largely solved with multisignature wallets. But centralized databases have this same attack vector, along with all the challenges of maintaining a database.
      - fleetingmoments 9y ago
        And if you get hacked and can prove it, the bank/municipality has the power to correct fraudulent transactions.
        niij 9y ago
        If they have the power to reverse the transaction, then what does Bitcoin add over a Database?
- UncleMeat 9y ago
  If the government needs to keep a record of who owns the house in order to resolve such problems then used a centralized and auditable system rather than a distributed one.
splintercell 9y ago
In a naive implementation, yes. But to implement this properly, the real estate title should and would not serve the same purpose a bitcoin 'title' does via it's private key. In case of bitcoin, a private key is literally the ownership of the bitcoins. In case of real tangible assets, the private key would serve as a pretty solid proof of ownership (but not THE ownership itself). So, in case of a dispute over the ownership of a real estate property, you can point out that you had the ownership of the property via the blockchain. In case of a theft of the keys, you must provide supplementary documentation regarding the prior ownership of the stolen keys. A pretty neat solution for the blockchain identity is being described by Vinay Gupta[1]. A simplified version is, imagine if the private key using which you purchased the house is stolen from you, then in front of the arbitrator, you present receipt from Amazon, where you used your private key to pay for goods which were delivered to you in your name, an affidavit from your bank which shows that you did business with them (using your real identity) and connected with your private key. All these 'documentation' (which Vinay Gupta describes as 'insurance') is very hard for the thief to produce. The same is not the case with bitcoin theft, where loss of private keys means loss of control of the assets (and not merely a 'dispute'). I hope that helps to explain it. 1. https://medium.com/humanizing-the-singularity/a-blockchain-solution-for-identity-51fbcae94caa https://medium.com/humanizing-the-singularity/a-blockchain-s...
- xorcist 9y ago
  > proof of ownership (but not THE ownership itself) The two could be if not the same then at least intertwined even for tangible assets. One could imagine a safety deposit box for example, with an electronic lock that would open not with a combination but a signature from the key that currently controls it on the blockchain. That would be a nifty hack (and also a good plot for a movie where the hero manages to transfer ownership just in time for the bad guys to reach it).
- cwkoss 9y ago
  If the arbitrator can alter ownership state (and the govt authorizes them to rewrite the blockchain to incorporate their findings) it isn't really a blockchain: just a centralized database. If they can't alter the blockchain, then ownership state on the blockchain will diverge from reality over time.

Well, actually it just sits there forever and no one can use it. Think of this more like converting your home into a museum for future generations.

usrusr 9y ago
Why? If the transactions logged on the blockchain contain annotations about your identity, you (as described by those annotations) would still own the house, only an impersonator matching those annotations as good as you would be able to challenge your ownership. On a blockchain without any fallbacks you would lose any ability to ever transfer ownership. As for future generations, will anyone could claim it but your heirs might have a better shot at it than a random impersonator.

danpat 9y ago

That's apples and oranges. A house and land doesn't become inaccessible if a key is lost, and the gatekeeper of "ownership of land" isn't the mathematics of the blockchain, it's the government.

paulgb 9y ago
Well sure, but that seems to undermine the necessity of the blockchain for this purpose right? If the ultimate arbiter is still the government, decentralizing the ledger is neat but it doesn't remove the requirement for trust in the government.
- smokeyj 9y ago
  Bitcoin has proven to be an effective ledger in regards to uptime, consistency and not getting hacked. The transaction fees are becoming higher but it's probably still cheaper than administering your own database that's potentially worth billions of dollars. Bitcoin is worth billions of dollars so I'd rather trust it to maintain my records than some municipalities IT guy.
  - drdrey 9y ago
    The protocol itself has not been hacked, but private keys get hacked all the time
    - smokeyj 9y ago
      This is largely solved with multisignature wallets. But centralized databases have this same attack vector, along with all the challenges of maintaining a database.
    - fleetingmoments 9y ago
      And if you get hacked and can prove it, the bank/municipality has the power to correct fraudulent transactions.
      - niij 9y ago
        If they have the power to reverse the transaction, then what does Bitcoin add over a Database?
UncleMeat 9y ago
If the government needs to keep a record of who owns the house in order to resolve such problems then used a centralized and auditable system rather than a distributed one.

splintercell 9y ago

In a naive implementation, yes. But to implement this properly, the real estate title should and would not serve the same purpose a bitcoin 'title' does via it's private key. In case of bitcoin, a private key is literally the ownership of the bitcoins. In case of real tangible assets, the private key would serve as a pretty solid proof of ownership (but not THE ownership itself). So, in case of a dispute over the ownership of a real estate property, you can point out that you had the ownership of the property via the blockchain. In case of a theft of the keys, you must provide supplementary documentation regarding the prior ownership of the stolen keys. A pretty neat solution for the blockchain identity is being described by Vinay Gupta[1]. A simplified version is, imagine if the private key using which you purchased the house is stolen from you, then in front of the arbitrator, you present receipt from Amazon, where you used your private key to pay for goods which were delivered to you in your name, an affidavit from your bank which shows that you did business with them (using your real identity) and connected with your private key. All these 'documentation' (which Vinay Gupta describes as 'insurance') is very hard for the thief to produce. The same is not the case with bitcoin theft, where loss of private keys means loss of control of the assets (and not merely a 'dispute'). I hope that helps to explain it. 1. https://medium.com/humanizing-the-singularity/a-blockchain-solution-for-identity-51fbcae94caa https://medium.com/humanizing-the-singularity/a-blockchain-s...

xorcist 9y ago
> proof of ownership (but not THE ownership itself) The two could be if not the same then at least intertwined even for tangible assets. One could imagine a safety deposit box for example, with an electronic lock that would open not with a combination but a signature from the key that currently controls it on the blockchain. That would be a nifty hack (and also a good plot for a movie where the hero manages to transfer ownership just in time for the bad guys to reach it).
cwkoss 9y ago
If the arbitrator can alter ownership state (and the govt authorizes them to rewrite the blockchain to incorporate their findings) it isn't really a blockchain: just a centralized database. If they can't alter the blockchain, then ownership state on the blockchain will diverge from reality over time.