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We're building on Ethereum. Live projects for customers for 18 months. The product is an NFT which gives you legal ownership of an underlying physical object w

We're building on Ethereum. Live projects for customers for 18 months. The product is an NFT which gives you legal ownership of an underlying physical object when you buy it. An individually numbered bar of gold in a vault. A scarce collectible. Real estate. The real estate thing is interesting: transfer time goes down from around 4 months in the UK to a couple of days. The only delay is the KYCAMLCTFPEPOFACT checking: if that's done as a pre-clearing step the transfer of real estate will be instantaneous. It took several years to build this capability. The blockchain is not done. http://mattereum.com/land http://mattereum.com/land

RandomLensman 4y ago
As I don't know how it works in the UK: is there no registry where ownership of land is being held or can that already be edited/updated in real time to transfer real estate?
- chrisbaker98 4y ago
  Yes, there is: https://www.gov.uk/government/organisations/land-registry https://www.gov.uk/government/organisations/land-registry
  - leashless 4y ago
    The issue is the conveyancing process as a whole. It's extremely slow and expensive.
bjelkeman-again 4y ago
Having bought and sold property in the UK and comparing it to Sweden, for example, then I can only say that the UK process is archaic and incredibly cumbersome. So this is a very interesting place to improve the process. If you can get the legal process to stick and not end up with some edgecase situations where people end up losing their right to the property, this I think could be of real value to the UK. Disclosure: I have known @leashless since way before Ethereum.
- propertea 4y ago
  If there's a system in the UK that is slow, and a system in Sweden that is fast, why is blockchain / crypto / smart contracts etc. the solution to the UK's slow system instead of whatever Sweden is doing -- since whatever Sweden is doing is working?
  - bjelkeman-again 4y ago
    My experience is that things like this is often deeply rooted in the culture, legal system and business practices in a country. It is not easy to copy those things from one country to another. Especially where we have quite different legal systems. Additionally in the UK people are proud of getting on, despite old fashioned systems. Whereas in Sweden they strive always to modernize. So, different cultures. (Of course, huge generalization there. For example the UK has done better on open data in the government than the Swedes have done, so in this case the whole thing is reversed. )
- leashless 4y ago
  Hey Thomas. Yes! The key here is the failover to English Common Law: if something breaks the failover is binding arbitration with a technically sophisticated arbitrator who will come in, figure out who owns what, make the awards, job done. Obviously that's minimal protection if (for example) somebody has their cryptocurrency stolen and it's just gone - but ownership of the physical property isn't subject to those kinds of misfortunes. It's 100% under law, as you would expect!
hiq 4y ago
1. What happens if a user loses their private key linked to an NFT, and this NFT is then transferred to another private key? Who owns the property then? 2. Why does this need a blockchain?
- leashless 4y ago
  2. first: simultaneous atomic execution of a stack of legal contracts (six is the most we have done) as a single atomic unit, with payment and proof of signing as part of the system. Also there's no other way of doing an e-commerce style purchase for something which is too expensive to pay for using a credit card. You can't buy land using Apple Pay. 1. See the above answer about somebody dying and leaving the NFT behind. Basically the NFT is stripped of its legal meaning, and then a clean NFT is reissued. You need a legal dispute raised before this can be ordered by a court, and that's the only situation under which it occurs.
  - hiq 4y ago
    1. What's the point of using a public blockchain[0] if this decentralized NFT can actually be rendered moot by the legal system and a new one replace it at will? 2. Atomicity is a common property of database transactions, not something unique to Ethereum, so I'm not sure I follow the blockchain requirement for this. You mention e-commerce style purchases but the legal side of things seem to imply that it's still more complicated than buying something on Amazon: the NFT only has the meaning you're willing to give it; if someone sends me an NFT you issued, I still need to check that you didn't revoke it and that it represents what the seller says. Your website also mentions a "Mattereum Asset Passport" which indicates that the NFT doesn't stand on its own. Overall I find it hard to see what the NFT actually brings, especially given your other comment mentioning legal disputes (https://news.ycombinator.com/item?id=33879695 https://news.ycombinator.com/item?id=33879695). I don't see why you couldn't replace all of that with: * a database you control * certificates you issue yourself, signed with your own key * provide an interface (web or API) facilitating the transaction of these certificates between users [0]: public blockchain as defined there: https://www.schneier.com/essays/archives/2019/02/theres_no_good_reaso.html https://www.schneier.com/essays/archives/2019/02/theres_no_g...
sgtfrankieboy 4y ago
How do you deal with the physical object being sold without anyone caring about the NFT attached to it, and thus not transferring it?
- leashless 4y ago
  The physical objects are protected from this by being held by independent custodians (for vaulted assets like gold) or SPVs (for things like land) generally speaking. If we can't figure out how to prevent this for a given asset, we don't touch that asset.
  - RandomLensman 4y ago
    So you are actually selling SPVs (or share of ownership in those) and not land directly then?
    - leashless 4y ago
      No, the land is being transferred, but it's a two-part transaction: an obligation, and then the later fulfilment of the obligation by updating the national land registry. But part one can be done many times before part two has to be done.
      - RandomLensman 4y ago
        So there is ownership in an SPV and the land? Sorry, I don't quite get the structure. Does the SPV "encumber" the land to make a direct transfer not possible then? If I directly own the land, what role has the SPV?
        leashless 4y ago
        The NFT imposes an obligation on the SPV. This obligation can move around many times. The NFT owner can then, at their option, pull the land out of the SPV (and the NFT is burned in the process!) to take ownership via the land register being updated. The NFT purchase is still the transfer of the interest in the land, and the point where stamp duty is paid to the UK government. That's where the value transfer happens.
runako 4y ago
Since other people are asking similar questions, I will follow up with some specific questions rooted in my ignorance of the UK property system (I am in the USA). Are you saying that in the UK it takes 4 months to transfer ownership of a gold bar or a collectible item? Do real estate transactions really take 4 months in the UK? Do you know if there are many other countries where ownership transfer is similarly cumbersome?
- nibbleshifter 4y ago
  It can take many months to do a real estate transfer in many countries: in the UK it can be anywhere from a couple of months to a year. Its not a fast system, basically the seller and the buyers lawyers have to mutually verify the sale is legal etc etc (that the seller actually can sell the property, that its not encumbered by a mortgage or such, etc). Buyer needs proof of funds, etc. Pre-clearing the property and potential buyers can cut this time to days or hours.
  - leashless 4y ago
    For gold the issue isn't speed of transfer - you can buy and sell gold as an e-commerce type transaction for smaller quantities. But when you get up to 400 oz "Good Delivery" bars things start to change, as you would expect with higher value transfers. Having a very hard proof of title on a gold bar, which is automatically updated if there's any change of circumstances, opens up a lot of useful functionality for gold owners.
    - nibbleshifter 4y ago
      I've bought smaller amounts of gold before (up to a couple ounces), and yeah, its just normal ecommerce. Some try enforce KYC, most don't. Interestingly, most gold I've seen above an ounce come with a cert and a serial number.
ohgodplsno 4y ago
Unless you sign a real contract in the real world moving the ownership of said gold bar from you to me, all your NFT is is a very expensive piece of paper that says "pinky promise it's yours" while the bank holding it has it filed under "Mattereum", and it's all that matters. I can't go there and pull it out of the vault, without you being there. NFTs are worthless, unless you have official ownership of the thing. And if that's the case, then why the hell would I use an NFT ?
- leashless 4y ago
  Of course! Everything we do involves the creation and execution of binding legal contracts under UK law. The blockchain is being used as a transactional technology here, not as a jurisdiction!
  - the_gastropod 4y ago
    Blockchain is an awful technological choice to serve that purpose.
    - leashless 4y ago
      That's not our experience. It's pretty hard to do an instantaneous transfer of very large sums of money, with atomic transactions of some complexity, using any other system we are aware of.
      - the_gastropod 4y ago
        With all due respect, these attributes you've described are irrelevant: - Large sums of money. Ok? Standard-issue transactional databases can transact in large numbers just fine. No problem there... - Atomic transactions of some complexity. How does blockchain help here? It doesn't. There are other systems doing some checks, after which a transaction is committed. That very same system could just as easily use a centralized transactional database The only advantage a blockchain has is allowing arbitrary untrusted writers to the database. Exceedingly few situations require this, and you pay a very hefty price for that feature. Acknowledging that there's an authority in your system (the legal system) means you do not need this feature of blockchains.
UncleMeat 4y ago
> transfer time goes down from around 4 months in the UK to a couple of days I've got no idea what the fuck they are doing in the UK, but when I bought a house in the US my deed transfer was processed by the county in about six hours.
- Nursie 4y ago
  The actual official government registry part of the process is negligible. What takes the time is lawyers talking to each other about god knows what, for months on end, for no apparent reason. My last house sale in the UK took about 4 months to go through. I am glad I don’t live there any more.
  - grumpymouse 4y ago
    I'd love it to be faster, but (when I bought in the UK) a lot of the things my solicitor checked were things that I'd definitely want to know before handing over money: Whether the seller actually owns the property or lease, if there are other people who would have a valid claim on the land/building (or historical covenants that would prevent the construction of the building there etc). For leasehold, verify how long is remaining and so on. Environmental information (whether the property is built on land that regularly floods, whether the site has a history of subsidence that could cause a significant risk to the building etc). Also, if you're buying with a mortgage, the mortgage company are going to want to have a look at the property to know that they're going to get their money back if you default on the mortgage and they have to sell it themselves.
    - leashless 4y ago
      Have a look over this: https://passport.mattereum.com/West.London.Lets.01/#01_Identity https://passport.mattereum.com/West.London.Lets.01/#01_Ident... I think you'll find all that information is there, with a very strong legal framework around it.
lgreiv 4y ago
As much as I always liked the idea of a more frictionless system for the transfer of asset ownership, I still have too many open questions on the integration with the legal system of the participants. Say you have the NFT that claims ownership of a house. Now the local court allocates half of the house to your ex-husband whom you’ve just divorced. How is this (exemplary) case handled on the chain? How is any repossession through local legal system? Who gets to own the house should the private key be lost? The answer to most of these questions is usually (I do not know your solution) some centralized entity that is introduced somewhere in the chain. This may have come of as an attack, but be assured that I am genuinely curious whether a solution has been found that I am not aware of.
- leashless 4y ago
  On the legal side of this, let me quote Sir Geoffrey Vos who is the head of civil justice in the UK. https://www.judiciary.uk/wp-content/uploads/2022/02/Speech-MR-to-Smarter-Contracts-Report-Launch-Lawtech-UK-UKJT-Blockchain-Smart-Contracts.pdf https://www.judiciary.uk/wp-content/uploads/2022/02/Speech-M... 7. The blockchain is now at a stage in its development equivalent to where the internet was in or around 1995. The internet was unstoppable in 1995 and blockchain technology is unstoppable now. It will become ubiquitous in all major industrial and financial sectors, simply because it allows for the immutable recording of data, thereby reducing friction in commercial and consumer transactions and obliterating the scope for dispute as to what has occurred. 8. As the Master of the Rolls and Head of Civil Justice in England and Wales, I hold an office that pre-dates modern trade in derivatives and reinsurance, even steam engines, powered flight, and certainly the internet. I am particularly and obviously concerned about the reputation and development of English law and the jurisdiction of England and Wales. 9. Many people do not realise that English law governs trading in €600 trillion of OTC derivatives annually, in €11.6 trillion in metals trading, in £250 billion in M&A deals, and in £80 billion in insurance contracts every year – just to take a few examples. My hope is that English law will prove to be the law of choice for borderless blockchain technology as its take up grows exponentially in the months and years to come. (quote ends) Point being none of this is happening outside of the framework of law: transfer of ownership is the objective of the system. If you're legal owner of the house and a court takes half of it off you, the legal package around the NFT kicks in, breaks the tie between the NFT and the land (yes, there's an authoritative way of indicating this) and you then figure out what to do with the remaining property rights. When dealing with land, the legal system is always primary.
dale_glass 4y ago
Has this actually been tested legally? What would happen if somebody used any kind of exploit to obtain the NFT? Could I as the new owner of the NFT just go to the local police, show the NFT in my wallet, and demand for the previous owner to be removed from it? What happens if the person who owns the NFT dies without passing on the access to their wallet to anybody? Is the idea that this chunk of land is now eternally owned by a dead person? Would you expect the local law to comply with that?
- leashless 4y ago
  In all these instances, the answer is litigation under the terms of service which are associated with the NFT or the warranty contracts which guarantee the status of the property. You bring a case under those terms: "I am the legal owner of this land and I want the NFT which was owned by the deceased to be reissued to me". The legal binding on the original NFT is broken, and a new NFT is issued. There's also provision under the UK Jurisdiction Taskforce digital dispute resolution rules https://lawtechuk.io/explore/ukjt-digital-disputes-rules https://lawtechuk.io/explore/ukjt-digital-disputes-rules to have an arbitrator use a judicial back door in the NFT contract to transfer ownership of the NFT if the contract has those affordances. We feel that's very powerful.
  - UncleMeat 4y ago
    > The legal binding on the original NFT is broken, and a new NFT is issued. oooooooof. Centralization removes what modest benefits there were in the first place.
    - leashless 4y ago
      Not from where we are standing. For us, the critical features of the blockchain are: 1) simultaneous execution of a substantial number of legal contracts between different counter-parties as a single atomic transaction 2) non-repudiatable payments going to all of those contract counter-parties 3) single source of truth on a publicly visible resource so all parties can see what's going on at all times 4) "litigation-ready" record keeping about who did what when And so on: it's a better way of doing certain legal processes not some kind of magic pixie dust. That's a pretty different take from the general blockchain rhetoric, but this represents the UK legal consensus on the blockchain. It's a tool, not a jurisdiction.
inigo 4y ago
The property you are selling is a piece of beach land in Milford on Sea on the south coast: https://passport.mattereum.com/West.London.Lets.01/ https://passport.mattereum.com/West.London.Lets.01/ "The NFT is listed on the NFT marketplace OpenSea for offers over £1.9M" That piece of land was last sold for £7000 on 20th October 2021. https://search-property-information.service.gov.uk/search/summary/kQM_-UOqOhRURtvItEv5Gg== https://search-property-information.service.gov.uk/search/su... I know inflation is bad, but £7000 to £1.9M is an impressive increase in value, for a piece of scrubby beach that looks impossible to get planning permission for.
- leashless 4y ago
  If you think coastal land costs £7000 in the UK, I have a bridge I'd like to sell you!
  - leashless 4y ago
    (which is to say it's a records issue, not the real value of the land)
  - phphphphp 4y ago
    The fact that you're so willing to lie so brazenly when you're dealing with an unproven and high-risk legal process is, well, I don't know, it undermines your trustworthiness somewhat -- and proves correct all the cynicism about blockchain being an industry full of frauds. Either the land price was misreported in order to evade taxes or you're lying. Given there's a website showing that the land was for sale for £7,000 1 year ago, I'm going with you're lying -- although either option is bad! https://www.cliveemson.co.uk/properties/228/71/ https://www.cliveemson.co.uk/properties/228/71/ I guess the third option is that you've been taken for a fool by whoever owns the land. Do you have an independent valuation showing the land is worth more than £7k? You can also look up the supposed seller and see that their assets are worth... well, nowhere near a million: https://find-and-update.company-information.service.gov.uk/company/09214284/filing-history https://find-and-update.company-information.service.gov.uk/c... If you can show that land is worth more than £1,000,000 I will happily buy any bridges you have for sale!
doliveira 4y ago
People go through these long legal routes because they're, well, legally binding. Are your NFTs proven to be legally binding?
- leashless 4y ago
  Proven is always a strong word. But they're https://lawtechuk.io/explore/ukjt-digital-disputes-rules https://lawtechuk.io/explore/ukjt-digital-disputes-rules integrated into legal contracts using this rule set and that's well understood. There's no real problem with smart contracts under English law: there's clear evidence of intent to form an agreement, a payment is made etc. It's pretty uncontroversial.
  - freejazz 4y ago
    In US there are all sorts of rules about various kinds of conveyances. Real property requires a recorded deed or the seller can just resell (and its legally binding against you), copyright requires a signed writing, etc.
  - doliveira 4y ago
    It's not that hard. Why do you think people go through the legal hurdles if they could just write it themselves in a book?
radicalbyte 4y ago
That takes a day in The Netherlands. Source: experience buying houses and I worked on one of the systems for a year at the Land Registry (years ago, before Ethereum was a thing). Fees are very low too.
- leashless 4y ago
  The overhaul to get the Netherlands to that point took about 10 years, if I recall - I saw a talk by a team from your Land Registry talking about scanning goat hide parchments in Old Dutch into the property rights database! It's a pretty impressive system overall: https://www.elra.eu/enriching-the-data-from-the-cadastre-and-land-registers/ https://www.elra.eu/enriching-the-data-from-the-cadastre-and... and in jurisdictions with this kind of sophistication obviously there's less need for alternative solutions.
  - radicalbyte 4y ago
    Yeah, I worked on a system where they wanted to make this accessible - until someone realised that yeah, OCR doesn't work on 300 year old documents :)
Nursie 4y ago
On the one hand, reducing the time it takes to buy or sell a house is a great thing. But on the other, there’s a lot of due diligence that is appropriate to carry out as a purchaser that doesn’t seem covered and it’s unclear that the NFT or blockchain adds anything to the picture - the value-add here is in having done the searches ahead of time.
- leashless 4y ago
  And making a properly binding handling of the liabity is absolutely key to being able to do those searches ahead of time. And that requires record keeping, proofs of payment, lots of document handling, simultaneous execution of a pile of different contracts, and so on. It's actually a pretty good use case for the blockchain. It solves real problems here. Obviously it's not as sophisticated as systems that have been in use for 10 years, but it's a lot better than some of the archaic systems which still cleave to norms which have been in place for centuries.
  - Nursie 4y ago
    I'm not sure I would see a blockchain as a particularly good fit - the benefits of blockchain architectures are generally where there is a lack of trust or identifiable authority, without that then there's probably a simpler solution. What happens in your system if the NFT key is lost or stolen? If the answer is "We can fix that", then you have your authority, you have a 'real' part in the background and the NFT part is really just for show. And if the answer is "well that breaks everything" then it's a pretty bad system for property! Also by the looks of the info here - https://passport.mattereum.com/West.London.Lets.01/ https://passport.mattereum.com/West.London.Lets.01/ - the NFT is not really equivalent to full legal title, mattereum the company appears to act as a sort of ownership proxy which will transfer the title to the NFT holder on demand. So honestly it doesn't feel like cutting the UK property purchase bureaucracy so much as putting a legal structure in front of ownership so that you don't really complete a purchase at all. As the other user pointed out too, well, good luck getting a million bucks for that little stretch of gravel in the middle of nowhere!
dmitriid 4y ago
> The real estate thing is interesting: transfer time goes down from around 4 months in the UK to a couple of days. The only delay is the KYCAMLCTFPEPOFACT checking: if that's done as a pre-clearing step the transfer of real estate will be instantaneous. It took several years to build this capability. So. The delay is still there, you still need KYC and other checks. The speed up is due to transfering paper records to a digital system, and has nothing to do with blockchain. But sure. "NFTs and Blockchain" something something. Good grief. In a backwards country of Moldova (where I'm from) property transfers (and other transfers like changing car ownership etc.) are instantaneous and don't need NFTs, blockchains or Ethereum. Go figure, must be happening by magic.
- leashless 4y ago
  Sure. But in vast tracts of the world - UK, US, many other jurisdictions in the G20, and even more in poorer countries - land registers are a mess and transfers are hard.
  - dmitriid 4y ago
    Yes. And the solution to that is simplifying and digitising them. Blockchains are not required. I mean, if Moldova figured it out, so can "many other jurisdictions".
    - leashless 4y ago
      In the UK that could be 50 years. Easily.
    - leashless 4y ago
      In America the land registers are not even state by state, they're county by county. It's going to take a while. The turning circle of these entities is much larger than that of Moldova.
      - dmitriid 4y ago
        > It's going to take a while. Yes. And blockchains, NFTs snd other useless crap have nothing to do with it.
mrguyorama 4y ago
Buying an NFT cannot legally give me land. That's reality. The NFT and crypto provides 0 value over just a normal contract. In fact, if the system worked the way you pretend it does, that would be even worse. If you defrauded me by lying about the realities of the property, I would have no recourse to be made whole.
freejazz 4y ago
What?! You can't transact real estate in the US without recording the deed in your local county clerk's office...

RandomLensman 4y ago

As I don't know how it works in the UK: is there no registry where ownership of land is being held or can that already be edited/updated in real time to transfer real estate?

chrisbaker98 4y ago
Yes, there is: https://www.gov.uk/government/organisations/land-registry https://www.gov.uk/government/organisations/land-registry
- leashless 4y ago
  The issue is the conveyancing process as a whole. It's extremely slow and expensive.

bjelkeman-again 4y ago

Having bought and sold property in the UK and comparing it to Sweden, for example, then I can only say that the UK process is archaic and incredibly cumbersome. So this is a very interesting place to improve the process. If you can get the legal process to stick and not end up with some edgecase situations where people end up losing their right to the property, this I think could be of real value to the UK. Disclosure: I have known @leashless since way before Ethereum.

propertea 4y ago
If there's a system in the UK that is slow, and a system in Sweden that is fast, why is blockchain / crypto / smart contracts etc. the solution to the UK's slow system instead of whatever Sweden is doing -- since whatever Sweden is doing is working?
- bjelkeman-again 4y ago
  My experience is that things like this is often deeply rooted in the culture, legal system and business practices in a country. It is not easy to copy those things from one country to another. Especially where we have quite different legal systems. Additionally in the UK people are proud of getting on, despite old fashioned systems. Whereas in Sweden they strive always to modernize. So, different cultures. (Of course, huge generalization there. For example the UK has done better on open data in the government than the Swedes have done, so in this case the whole thing is reversed. )
leashless 4y ago
Hey Thomas. Yes! The key here is the failover to English Common Law: if something breaks the failover is binding arbitration with a technically sophisticated arbitrator who will come in, figure out who owns what, make the awards, job done. Obviously that's minimal protection if (for example) somebody has their cryptocurrency stolen and it's just gone - but ownership of the physical property isn't subject to those kinds of misfortunes. It's 100% under law, as you would expect!

hiq 4y ago

1. What happens if a user loses their private key linked to an NFT, and this NFT is then transferred to another private key? Who owns the property then? 2. Why does this need a blockchain?

leashless 4y ago
2. first: simultaneous atomic execution of a stack of legal contracts (six is the most we have done) as a single atomic unit, with payment and proof of signing as part of the system. Also there's no other way of doing an e-commerce style purchase for something which is too expensive to pay for using a credit card. You can't buy land using Apple Pay. 1. See the above answer about somebody dying and leaving the NFT behind. Basically the NFT is stripped of its legal meaning, and then a clean NFT is reissued. You need a legal dispute raised before this can be ordered by a court, and that's the only situation under which it occurs.
- hiq 4y ago
  1. What's the point of using a public blockchain[0] if this decentralized NFT can actually be rendered moot by the legal system and a new one replace it at will? 2. Atomicity is a common property of database transactions, not something unique to Ethereum, so I'm not sure I follow the blockchain requirement for this. You mention e-commerce style purchases but the legal side of things seem to imply that it's still more complicated than buying something on Amazon: the NFT only has the meaning you're willing to give it; if someone sends me an NFT you issued, I still need to check that you didn't revoke it and that it represents what the seller says. Your website also mentions a "Mattereum Asset Passport" which indicates that the NFT doesn't stand on its own. Overall I find it hard to see what the NFT actually brings, especially given your other comment mentioning legal disputes (https://news.ycombinator.com/item?id=33879695 https://news.ycombinator.com/item?id=33879695). I don't see why you couldn't replace all of that with: * a database you control * certificates you issue yourself, signed with your own key * provide an interface (web or API) facilitating the transaction of these certificates between users [0]: public blockchain as defined there: https://www.schneier.com/essays/archives/2019/02/theres_no_good_reaso.html https://www.schneier.com/essays/archives/2019/02/theres_no_g...

sgtfrankieboy 4y ago

How do you deal with the physical object being sold without anyone caring about the NFT attached to it, and thus not transferring it?

leashless 4y ago
The physical objects are protected from this by being held by independent custodians (for vaulted assets like gold) or SPVs (for things like land) generally speaking. If we can't figure out how to prevent this for a given asset, we don't touch that asset.
- RandomLensman 4y ago
  So you are actually selling SPVs (or share of ownership in those) and not land directly then?
  - leashless 4y ago
    No, the land is being transferred, but it's a two-part transaction: an obligation, and then the later fulfilment of the obligation by updating the national land registry. But part one can be done many times before part two has to be done.
    - RandomLensman 4y ago
      So there is ownership in an SPV and the land? Sorry, I don't quite get the structure. Does the SPV "encumber" the land to make a direct transfer not possible then? If I directly own the land, what role has the SPV?
      - leashless 4y ago
        The NFT imposes an obligation on the SPV. This obligation can move around many times. The NFT owner can then, at their option, pull the land out of the SPV (and the NFT is burned in the process!) to take ownership via the land register being updated. The NFT purchase is still the transfer of the interest in the land, and the point where stamp duty is paid to the UK government. That's where the value transfer happens.

runako 4y ago

Since other people are asking similar questions, I will follow up with some specific questions rooted in my ignorance of the UK property system (I am in the USA). Are you saying that in the UK it takes 4 months to transfer ownership of a gold bar or a collectible item? Do real estate transactions really take 4 months in the UK? Do you know if there are many other countries where ownership transfer is similarly cumbersome?

nibbleshifter 4y ago
It can take many months to do a real estate transfer in many countries: in the UK it can be anywhere from a couple of months to a year. Its not a fast system, basically the seller and the buyers lawyers have to mutually verify the sale is legal etc etc (that the seller actually can sell the property, that its not encumbered by a mortgage or such, etc). Buyer needs proof of funds, etc. Pre-clearing the property and potential buyers can cut this time to days or hours.
- leashless 4y ago
  For gold the issue isn't speed of transfer - you can buy and sell gold as an e-commerce type transaction for smaller quantities. But when you get up to 400 oz "Good Delivery" bars things start to change, as you would expect with higher value transfers. Having a very hard proof of title on a gold bar, which is automatically updated if there's any change of circumstances, opens up a lot of useful functionality for gold owners.
  - nibbleshifter 4y ago
    I've bought smaller amounts of gold before (up to a couple ounces), and yeah, its just normal ecommerce. Some try enforce KYC, most don't. Interestingly, most gold I've seen above an ounce come with a cert and a serial number.

ohgodplsno 4y ago

Unless you sign a real contract in the real world moving the ownership of said gold bar from you to me, all your NFT is is a very expensive piece of paper that says "pinky promise it's yours" while the bank holding it has it filed under "Mattereum", and it's all that matters. I can't go there and pull it out of the vault, without you being there. NFTs are worthless, unless you have official ownership of the thing. And if that's the case, then why the hell would I use an NFT ?

leashless 4y ago
Of course! Everything we do involves the creation and execution of binding legal contracts under UK law. The blockchain is being used as a transactional technology here, not as a jurisdiction!
- the_gastropod 4y ago
  Blockchain is an awful technological choice to serve that purpose.
  - leashless 4y ago
    That's not our experience. It's pretty hard to do an instantaneous transfer of very large sums of money, with atomic transactions of some complexity, using any other system we are aware of.
    - the_gastropod 4y ago
      With all due respect, these attributes you've described are irrelevant: - Large sums of money. Ok? Standard-issue transactional databases can transact in large numbers just fine. No problem there... - Atomic transactions of some complexity. How does blockchain help here? It doesn't. There are other systems doing some checks, after which a transaction is committed. That very same system could just as easily use a centralized transactional database The only advantage a blockchain has is allowing arbitrary untrusted writers to the database. Exceedingly few situations require this, and you pay a very hefty price for that feature. Acknowledging that there's an authority in your system (the legal system) means you do not need this feature of blockchains.

UncleMeat 4y ago

> transfer time goes down from around 4 months in the UK to a couple of days I've got no idea what the fuck they are doing in the UK, but when I bought a house in the US my deed transfer was processed by the county in about six hours.

Nursie 4y ago
The actual official government registry part of the process is negligible. What takes the time is lawyers talking to each other about god knows what, for months on end, for no apparent reason. My last house sale in the UK took about 4 months to go through. I am glad I don’t live there any more.
- grumpymouse 4y ago
  I'd love it to be faster, but (when I bought in the UK) a lot of the things my solicitor checked were things that I'd definitely want to know before handing over money: Whether the seller actually owns the property or lease, if there are other people who would have a valid claim on the land/building (or historical covenants that would prevent the construction of the building there etc). For leasehold, verify how long is remaining and so on. Environmental information (whether the property is built on land that regularly floods, whether the site has a history of subsidence that could cause a significant risk to the building etc). Also, if you're buying with a mortgage, the mortgage company are going to want to have a look at the property to know that they're going to get their money back if you default on the mortgage and they have to sell it themselves.
  - leashless 4y ago
    Have a look over this: https://passport.mattereum.com/West.London.Lets.01/#01_Identity https://passport.mattereum.com/West.London.Lets.01/#01_Ident... I think you'll find all that information is there, with a very strong legal framework around it.

lgreiv 4y ago

As much as I always liked the idea of a more frictionless system for the transfer of asset ownership, I still have too many open questions on the integration with the legal system of the participants. Say you have the NFT that claims ownership of a house. Now the local court allocates half of the house to your ex-husband whom you’ve just divorced. How is this (exemplary) case handled on the chain? How is any repossession through local legal system? Who gets to own the house should the private key be lost? The answer to most of these questions is usually (I do not know your solution) some centralized entity that is introduced somewhere in the chain. This may have come of as an attack, but be assured that I am genuinely curious whether a solution has been found that I am not aware of.

leashless 4y ago
On the legal side of this, let me quote Sir Geoffrey Vos who is the head of civil justice in the UK. https://www.judiciary.uk/wp-content/uploads/2022/02/Speech-MR-to-Smarter-Contracts-Report-Launch-Lawtech-UK-UKJT-Blockchain-Smart-Contracts.pdf https://www.judiciary.uk/wp-content/uploads/2022/02/Speech-M... 7. The blockchain is now at a stage in its development equivalent to where the internet was in or around 1995. The internet was unstoppable in 1995 and blockchain technology is unstoppable now. It will become ubiquitous in all major industrial and financial sectors, simply because it allows for the immutable recording of data, thereby reducing friction in commercial and consumer transactions and obliterating the scope for dispute as to what has occurred. 8. As the Master of the Rolls and Head of Civil Justice in England and Wales, I hold an office that pre-dates modern trade in derivatives and reinsurance, even steam engines, powered flight, and certainly the internet. I am particularly and obviously concerned about the reputation and development of English law and the jurisdiction of England and Wales. 9. Many people do not realise that English law governs trading in €600 trillion of OTC derivatives annually, in €11.6 trillion in metals trading, in £250 billion in M&A deals, and in £80 billion in insurance contracts every year – just to take a few examples. My hope is that English law will prove to be the law of choice for borderless blockchain technology as its take up grows exponentially in the months and years to come. (quote ends) Point being none of this is happening outside of the framework of law: transfer of ownership is the objective of the system. If you're legal owner of the house and a court takes half of it off you, the legal package around the NFT kicks in, breaks the tie between the NFT and the land (yes, there's an authoritative way of indicating this) and you then figure out what to do with the remaining property rights. When dealing with land, the legal system is always primary.

dale_glass 4y ago

Has this actually been tested legally? What would happen if somebody used any kind of exploit to obtain the NFT? Could I as the new owner of the NFT just go to the local police, show the NFT in my wallet, and demand for the previous owner to be removed from it? What happens if the person who owns the NFT dies without passing on the access to their wallet to anybody? Is the idea that this chunk of land is now eternally owned by a dead person? Would you expect the local law to comply with that?

leashless 4y ago
In all these instances, the answer is litigation under the terms of service which are associated with the NFT or the warranty contracts which guarantee the status of the property. You bring a case under those terms: "I am the legal owner of this land and I want the NFT which was owned by the deceased to be reissued to me". The legal binding on the original NFT is broken, and a new NFT is issued. There's also provision under the UK Jurisdiction Taskforce digital dispute resolution rules https://lawtechuk.io/explore/ukjt-digital-disputes-rules https://lawtechuk.io/explore/ukjt-digital-disputes-rules to have an arbitrator use a judicial back door in the NFT contract to transfer ownership of the NFT if the contract has those affordances. We feel that's very powerful.
- UncleMeat 4y ago
  > The legal binding on the original NFT is broken, and a new NFT is issued. oooooooof. Centralization removes what modest benefits there were in the first place.
  - leashless 4y ago
    Not from where we are standing. For us, the critical features of the blockchain are: 1) simultaneous execution of a substantial number of legal contracts between different counter-parties as a single atomic transaction 2) non-repudiatable payments going to all of those contract counter-parties 3) single source of truth on a publicly visible resource so all parties can see what's going on at all times 4) "litigation-ready" record keeping about who did what when And so on: it's a better way of doing certain legal processes not some kind of magic pixie dust. That's a pretty different take from the general blockchain rhetoric, but this represents the UK legal consensus on the blockchain. It's a tool, not a jurisdiction.

inigo 4y ago

The property you are selling is a piece of beach land in Milford on Sea on the south coast: https://passport.mattereum.com/West.London.Lets.01/ https://passport.mattereum.com/West.London.Lets.01/ "The NFT is listed on the NFT marketplace OpenSea for offers over £1.9M" That piece of land was last sold for £7000 on 20th October 2021. https://search-property-information.service.gov.uk/search/summary/kQM_-UOqOhRURtvItEv5Gg== https://search-property-information.service.gov.uk/search/su... I know inflation is bad, but £7000 to £1.9M is an impressive increase in value, for a piece of scrubby beach that looks impossible to get planning permission for.

leashless 4y ago
If you think coastal land costs £7000 in the UK, I have a bridge I'd like to sell you!
- leashless 4y ago
  (which is to say it's a records issue, not the real value of the land)
- phphphphp 4y ago
  The fact that you're so willing to lie so brazenly when you're dealing with an unproven and high-risk legal process is, well, I don't know, it undermines your trustworthiness somewhat -- and proves correct all the cynicism about blockchain being an industry full of frauds. Either the land price was misreported in order to evade taxes or you're lying. Given there's a website showing that the land was for sale for £7,000 1 year ago, I'm going with you're lying -- although either option is bad! https://www.cliveemson.co.uk/properties/228/71/ https://www.cliveemson.co.uk/properties/228/71/ I guess the third option is that you've been taken for a fool by whoever owns the land. Do you have an independent valuation showing the land is worth more than £7k? You can also look up the supposed seller and see that their assets are worth... well, nowhere near a million: https://find-and-update.company-information.service.gov.uk/company/09214284/filing-history https://find-and-update.company-information.service.gov.uk/c... If you can show that land is worth more than £1,000,000 I will happily buy any bridges you have for sale!

doliveira 4y ago

People go through these long legal routes because they're, well, legally binding. Are your NFTs proven to be legally binding?

leashless 4y ago
Proven is always a strong word. But they're https://lawtechuk.io/explore/ukjt-digital-disputes-rules https://lawtechuk.io/explore/ukjt-digital-disputes-rules integrated into legal contracts using this rule set and that's well understood. There's no real problem with smart contracts under English law: there's clear evidence of intent to form an agreement, a payment is made etc. It's pretty uncontroversial.
- freejazz 4y ago
  In US there are all sorts of rules about various kinds of conveyances. Real property requires a recorded deed or the seller can just resell (and its legally binding against you), copyright requires a signed writing, etc.
- doliveira 4y ago
  It's not that hard. Why do you think people go through the legal hurdles if they could just write it themselves in a book?

radicalbyte 4y ago

That takes a day in The Netherlands. Source: experience buying houses and I worked on one of the systems for a year at the Land Registry (years ago, before Ethereum was a thing). Fees are very low too.

leashless 4y ago
The overhaul to get the Netherlands to that point took about 10 years, if I recall - I saw a talk by a team from your Land Registry talking about scanning goat hide parchments in Old Dutch into the property rights database! It's a pretty impressive system overall: https://www.elra.eu/enriching-the-data-from-the-cadastre-and-land-registers/ https://www.elra.eu/enriching-the-data-from-the-cadastre-and... and in jurisdictions with this kind of sophistication obviously there's less need for alternative solutions.
- radicalbyte 4y ago
  Yeah, I worked on a system where they wanted to make this accessible - until someone realised that yeah, OCR doesn't work on 300 year old documents :)

Nursie 4y ago

On the one hand, reducing the time it takes to buy or sell a house is a great thing. But on the other, there’s a lot of due diligence that is appropriate to carry out as a purchaser that doesn’t seem covered and it’s unclear that the NFT or blockchain adds anything to the picture - the value-add here is in having done the searches ahead of time.

leashless 4y ago
And making a properly binding handling of the liabity is absolutely key to being able to do those searches ahead of time. And that requires record keeping, proofs of payment, lots of document handling, simultaneous execution of a pile of different contracts, and so on. It's actually a pretty good use case for the blockchain. It solves real problems here. Obviously it's not as sophisticated as systems that have been in use for 10 years, but it's a lot better than some of the archaic systems which still cleave to norms which have been in place for centuries.
- Nursie 4y ago
  I'm not sure I would see a blockchain as a particularly good fit - the benefits of blockchain architectures are generally where there is a lack of trust or identifiable authority, without that then there's probably a simpler solution. What happens in your system if the NFT key is lost or stolen? If the answer is "We can fix that", then you have your authority, you have a 'real' part in the background and the NFT part is really just for show. And if the answer is "well that breaks everything" then it's a pretty bad system for property! Also by the looks of the info here - https://passport.mattereum.com/West.London.Lets.01/ https://passport.mattereum.com/West.London.Lets.01/ - the NFT is not really equivalent to full legal title, mattereum the company appears to act as a sort of ownership proxy which will transfer the title to the NFT holder on demand. So honestly it doesn't feel like cutting the UK property purchase bureaucracy so much as putting a legal structure in front of ownership so that you don't really complete a purchase at all. As the other user pointed out too, well, good luck getting a million bucks for that little stretch of gravel in the middle of nowhere!

dmitriid 4y ago

> The real estate thing is interesting: transfer time goes down from around 4 months in the UK to a couple of days. The only delay is the KYCAMLCTFPEPOFACT checking: if that's done as a pre-clearing step the transfer of real estate will be instantaneous. It took several years to build this capability. So. The delay is still there, you still need KYC and other checks. The speed up is due to transfering paper records to a digital system, and has nothing to do with blockchain. But sure. "NFTs and Blockchain" something something. Good grief. In a backwards country of Moldova (where I'm from) property transfers (and other transfers like changing car ownership etc.) are instantaneous and don't need NFTs, blockchains or Ethereum. Go figure, must be happening by magic.

leashless 4y ago
Sure. But in vast tracts of the world - UK, US, many other jurisdictions in the G20, and even more in poorer countries - land registers are a mess and transfers are hard.
- dmitriid 4y ago
  Yes. And the solution to that is simplifying and digitising them. Blockchains are not required. I mean, if Moldova figured it out, so can "many other jurisdictions".
  - leashless 4y ago
    In the UK that could be 50 years. Easily.
  - leashless 4y ago
    In America the land registers are not even state by state, they're county by county. It's going to take a while. The turning circle of these entities is much larger than that of Moldova.
    - dmitriid 4y ago
      > It's going to take a while. Yes. And blockchains, NFTs snd other useless crap have nothing to do with it.

mrguyorama 4y ago

Buying an NFT cannot legally give me land. That's reality. The NFT and crypto provides 0 value over just a normal contract. In fact, if the system worked the way you pretend it does, that would be even worse. If you defrauded me by lying about the realities of the property, I would have no recourse to be made whole.

freejazz 4y ago

What?! You can't transact real estate in the US without recording the deed in your local county clerk's office...