The Role Of Blockchain Technology In Decentralized Real Estate Marketplace: Recent Findings

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The Role Of Blockchain Technology In Decentralized Real
Estate Marketplace: Recent Findings
Apeksha Vitthal PatilA, Alpesh Vijay ShindeB, Aneesha PanigrahiC, Aryan AroraD, Dr. S. RavirajaE, Dr.
Ramesh Babu D RF
ADepartment of Computer Science and Engineering, Bangalore, India, apekshap81@gmail.com
BDepartment of Computer Science and Engineering, Bangalore, India, alpeshshinde29@gmail.com
CDepartment of Computer Science and Engineering, Bangalore, India, aneeshapanigrahi11@gmail.com
DDepartment of Computer Science and Engineering, Bangalore, India, rhitik.arora@gmail.com
EFounder Chair & Principal Investigator, Royal Research Foundation, India, sraviraja@royalresearch.org
FProfessor & Head, Department of Computer Science and Engineering, DSCE, India, hod-cse@dayanandasagar.edu
Abstract
The share of international Real Estate (RE) equities is twice as high as financial markets. Despite this, due to the
liquidity and lack of worldwide accessibility of RE, the number of investors is substantially fewer. In the existing
structure, tenants, landlords, and investors are barely content. In recent days Blockchain technology is playing a vital
role in the building environment where dependability of transaction attainment is predominant. Blockchain
facilitates decentralized, cryptographically secured, trustworthy, and immutable record-keeping of transactions.
However, more research exploration is much required to understand the process and complications in implementing
blockchain solutions in the built environment. The proposed research in this article is aimed to evaluate the existing
use of Blockchain platforms in the case of the Real Estate sector and recognize the benefits, feasibility, and scope for
future work. The contribution to the knowledge of this paper is in the demonstration of the process to follow to
implement a blockchain solution for a Real Estate marketplace. The findings provide the significance and the vital
role of the potential applications of blockchain in the built environment.
Keywords
Blockchain; Decentralized; Peer-to-peer; Real Estate; Smart Contracts
Electronic copy available at: https://ssrn.com/abstract=4096395

1. Introduction
Real Estate (RE) is acknowledged as among the safest investment possibilities. The primary reason is that RE offers
investors stability and acts as an inflation buffer. It is also a tangible asset that is great for portfolio assortment
because it is non-volatile and risk-free over a significant term period. Interests are encouraged to make investments,
rather than only specialists in the field.
In addition to the benefits of real estate properties, there are challenges as well. A comprehensive review of the way
real estate transactions are handled in the current system shows the issues present. Significant issues such as
transaction costs between the parties, slow price discovery, legal inconsistencies, and frauds prevail. Additionally,
the real estate market at present is dominated by the category of people who have good capital. In response to the
drawbacks centralized databases are facing, blockchain technology is able to solve some of these pressing issues in
Real Estate. In response to the drawbacks that the ongoing sector is facing, blockchain technology has features such
as immutable ledgers and smart contracts that are emerging and being used to introduce new techniques in the
market.
Figure 1. Working of Blockchain technology
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A blockchain is a decentralized database that is disseminated and propagated across the matrix of peer-to-peer
computer nodes that constitute the blockchain. A blockchain, such as a database, stores information electronically in
digital format. However, unlike a database blockchain-based system keeps track of transactions in a secured and
decentralized manner. The blockchain's breakthrough is that it ensures the accuracy and security of a data record
while also generating trust without the requirement for a trusted third party. The level of accuracy and security is
achieved by the distribution of access control over the multiple nodes present in the network. Moreover,
Blockchain-based Bitcoin is regarded as a pioneer to solve the double spending problem by implementing a
universal ledger system.
In essence, the digitalization of Real Estate, such as other domains, improves flexibility, effectiveness, and
accountability for one of the significant international investment options. The introduction of blockchain technology
has recognized and addressed some of the most prominent fundamental challenges in RE due to the disadvantages
that come with the current centralized database-based system.
Figure 2. Properties of Distributed Ledger Technology (DLT)
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2. Literature review
A thorough review of prominent research on the application of blockchain technology in real estate to date is made
in the following section, further pointing out the advantages and disadvantages of the current study. The review
covers twenty-five studies in a similar domain, illustrating how blockchain can be used to overcome the problems
faced by the traditional real estate system. The purpose of the review is to analyze the progress made in the domain
and find out key areas for improvement and enhancement.
Corluka D et al., proposed in the Real Estate sector as a fundamental shift toward further digitization is most
certainly required, with Blockchain-based solutions being one answer. This is critical in ensuring the actors' market
positions in the long run. The real estate sector might be transformed by Blockchain, with fewer inefficiencies.
Personal biases might be addressed and rectified, and a more liquid market could emerge as a result of lower
transaction costs. With increased openness, real estate cycles and market volatility might be reduced [1]. One of the
most significant obstacles to a seamless adoption of a Blockchain-based system is a fundamental shift in people's
perceptions of property worth and confidence in digital systems. Another significant difficulty for Blockchain
technology is persuading businesses and institutions that it is dependable and worthwhile to invest in. Due to the
shortened transaction procedures, intermediates such as brokers will have adjusted their employment tasks which
can help save money while also making the transaction process more efficient and seamless. A certain amount of
market openness is required, and property value is an appropriate area for more transparency.
In the work of Spielman A, the author introduces the abstract principles of Blockchain technology, beginning with a
high-level technical elucidation of the working of blockchain, as well as its advantages plus disadvantages. The
paper also takes a look at Bitcoin, which runs on the world's most vast Blockchain, as a possible framework, with a
realistic approach that can be remodelled to make a more efficient and secure property registration system [2]. The
paper then discusses recommendations on how to build a Blockchain driven registry as well as how its use may
affect the way landholding ownership transfers are conducted. However, at this time, the expenses plus obstacles
connected with developing a prototype Blockchain title registration framework do not exceed the advantages.
Author Atzori M., discusses the essential aspects of Blockchain premised decentralized governance, which
questions traditional state power, citizenship, and democratic methods to varying degrees. The study investigates
whether Blockchain and decentralized autonomous organizations might be regarded as hyper-political instruments
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adept enough at managing large-scale social interactions while bypassing traditional central authority [3]. The study
emphasizes the dangers of private forces wielding a dominating position in dispersed ecosystems, which might lead
to citizen dis-empowerment and the establishment of a stateless international community [3]. While technological
visionaries advocate for the scrapping of all centralized institutions, this research argues that the State is a necessary
medium for cooperation between the communities, illustrating that decentralization through consensus based on an
algorithm is not a political theory but rather an organizational theory.
Wouda H et al. proposed the use of Blockchain technology in commercial RE transactions. Considering the capacity
to organize data and ensure quality using encrypting and consensus procedures, the proposed infrastructure improves
the transaction process. Although the transaction procedure for an office building will seem very identical to the
"present" scenario, the network's dependability and security will be improved [4]. Hence indicates, a file would
appear to be local to the requesting party, which will be actually stored on the blockchain and be available locally as
per demand creating a visual representation of the planned transaction procedure. Although all parts are nearly
identical to those used in the existing process, it is possible that the installation of this database will speed up the due
diligence and negotiation process by increasing confidence between parties and improving information
dependability. As a result, the suggested approach improves the existing transaction procedure.
Christidis K., et al., in their work the depth concepts of Blockchains, IoT and how the integration of these two
technologies may be quite effective. Blockchains enable us to build robust, fully distributed peer-to-peer networks
and to interact with this network in a trust-less, assessed way. Smart contracts enable us to develop self-regulating
programs to simplify a complex multistage process. The IoT ecosystem's sensor nodes act as interconnection points
real-world environment. By integrating all the components, we can aim to automate these time taking procedures in
a method that is novel as well as innovative, attaining cryptographic authentication while also saving substantial
money and time [5]. The authors consider that the ongoing integration of Blockchains within the IoT sector might
result in substantial changes across a variety of industries, introducing new commerce strategies and challenging
researchers to rethink how best to apply current architecture and its techniques.
Lim I, et al. demonstrate the Analysis and Countermeasures on Security Breach of Bitcoin, because the conversion
of Bitcoin to legal money has inherent security concerns. There were multiple security breaches as the value of
Bitcoin proceeded to surge in 2013. Bitcoin may be used for money laundering, drug trafficking, and speculation,
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and accurately has a dark side [6]. However, the usage of e-money is expected to rise as the number of internet users
and internet-enabled devices globally continue to rise, thanks to the advancement of mobile technology. Also,
because Bitcoin is a decentralised currency with no issuing organisation, it is easier to trade than earlier virtual
currencies, and its use in online and offline shops is steadily rising as a result of its low fees and speedy payment. As
a result, currencies comparable to Bitcoin, such as Litecoin, Peercoin, and others, are constantly being developed.
Consequently, the research looked into the rise in security lapses and how they were dealt with. Hence the study
showcases the need for secure authentication methods appropriate for electronic financial services that have to be
utilised for Bitcoin exchange transactions, with a minimum of two-factor authentication. Not only will studies be
undertaken for virtual currency security technologies, but also a regulatory and methodical framework for the secure
and practical usage of Bitcoin.
Veuger J., the author here attempted to link Blockchain and its application such as real estate have not been
demonstrated in exercise. It is expected to advance in the form of events or payment recording procedures, and a real
estate object's DNA passport. The key factors for system trust are completeness and openness. Real estate wants to
stay afloat [7]. As a result, in order to connect real estate and management with societal demand, they must take
offence. Behaviour also leads to new profit models for disruptive real estate's social and economic spin-offs. If this
model works in the Netherlands' real estate market and accepts Blockchain, furthermore is capable enough to
implement improvements. The real estate entrepreneurs may be positioned to capitalise on the disruptive nature of
the technology to deliver some new innovative services.
Yli-Huumo J., et al., the author here continues to find new concerns and provide ways to solve the technology's
obstacles and limits. Since 2013, there has been significant growth in interest in Blockchain technology. From two
papers in 2013 to forty-one in 2015, the total number of papers has grown. The majority of research has focused on
overcoming obstacles and limits, but there are still numerous concerns that need to be addressed [8]. More research
should be done on Blockchain scalability difficulties. The majority of current Blockchain research is focused on
security and privacy concerns. Before Blockchain technology is extensively deployed, scalability issues like
throughput and latency must be addressed. Beyond Bitcoin and other monetary systems, create new
Blockchain-based apps. The present study is centred on the Bitcoin-centric framework. Nonetheless, the study found
that Blockchain innovation may be utilized in a variety of other applications, including smart contracts, property
licensing, and voting. Use objective assessment criteria to assess the efficacy of the offered solutions. Although
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various solutions to obstacles and constraints have been suggested, many of them are only vague recommendations
with no solid evidence of their effectiveness.
Zyskind G., et al., focused on Decentralizing Privacy using blockchain to protect personal data. The study has put
forward a system for decentralized data management to ensure that its participants can own and control their data. It
discusses rising public concern about user data privacy. Centralized organizations – public and personal – capture
huge quantities of private and sensitive data, causing users to have very little to no control over their data and the
way it's used. To solve this issue, it has demonstrated a system decentralized network of users mutually with a
public ledger in a reliable monetary sector. Moreover, programming laws and regulations in the form of smart
contracts [9]. Here, the ledger, being tamper-proof, will act as legal proof for accessing or storing data. It does not
address or involve any solution to resolve the lack of trustworthy computational issues in society.
Vos J., the author describes the working of blockchain technology and therefore emphasizes the impact it can have
on the practice of land registry systems and the purpose of legal specialists. It brings out the issue of land records
being poorly kept, mismanaged and corrupt and how blockchain technology can avoid such issues. It describes the
advantages of having distributed ledger associated with the blockchain network creating a trustworthy peer-to-peer
network for decentralized communications in which each party has the same power. It also addresses challenges
such as the existence of a large number of rights that can increase the complexity, especially while considering
different shares in various rights like in a case where multiple peers are entitled to different shares in various rights.
Such cases make it difficult to use Blockchain technology for land administration [10].
Swan M., et al., in this article authors set forward the use of blockchain for four main applications, namely fund
transfers, land registrations, contractual agreements, and identity verification. There are many potential economic
benefits from blockchain distributed ledger technology, which allows for safe online transfers of assets, money, and
information without the need for an intermediary. Transactions are validated, processed, and recorded in a
tamper-resistant append-only database, and are available for on-demand operation and verification [11]. The paper
goes into detail on the decentralized system's feature of giving users more control and authorization over their data.
In this manner, a trustless system is formed, in which users and institutions do not have to be verified and known.
Instead, the blockchain network infrastructure is considered trustworthy.
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Kshetri N., et al., investigate how blockchain is anticipated to affect key supply chains management objectives such
as cost, quality, speed, reliability, risk reduction, feasibility, and flexibility, as well as the numerous ways via which
blockchain supports supply chain transparency and accountability. The system allows for improved, real-time
tracking of items by their sources, as well as information about who is performing which actions and when and
where these actions are being carried out [12]. Blockchain can also aid in the implementation of comprehensive
cybersecurity measures by enhancing trust and security. Implementing blockchain-based solutions to the global
supply chain, which functions in a complicated environment, can be a challenging undertaking since it requires
multiple parties to comply with a variety of laws, rules, and institutions, and getting all essential parties together
probably be difficult.
Glaser F. brings the key principles and components of blockchain technology, as well as their relationships and novel
characteristics, and combines these findings with consequences for relevant sorts of digital market models for
various economic and academic contexts. It has elaborated on blockchain instantiations, which include a Turing
complete programming language is built on top of the replicated virtual machine, the decentralized peer-to-peer
network, the integrated public key infrastructure, a secure storage system for both transactions and the associated
data, and the Turing complete programming language is built on top of the replicated virtual machine [13].
Additionally, blockchain technology presents the prospect of decentralizing multiple layers of digital infrastructure.
It suggests that more research be conducted into how blockchain technology might be used to improve electronic
market interoperability.
Khan R. explores the prospects and challenges which can be addressed by using blockchain technology for land
ownership transfer. It focuses on developing an Ethereum blockchain-based system that not only can accelerate land
registration, but provide an effortless way for the parties involved to transfer the land ownership [14]. Furthermore,
the current land registration process and the problems related are discussed. The proposed solution includes a
platform where there are buyers, sellers and land inspectors. The user after registration can buy or sell property, after
the seller grants the transaction the land inspector gets the notification and the verification of the land is done. Thus,
the registered land’s authenticity is validated. For land and user verification the smart contract concept is used. An
additional feature provided on the platform is the liquidation of the land property, where land assets can be
liquidated using cryptocurrency associated with the land records created by the platform's sellers. There is scope for
further enhancements in various sectors of the platform.
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Kopylash V., presents a case of a Singaporean real estate company that wanted to integrate blockchain into its core
business processes. It had already integrated the signing of rental contracts with blockchain, storing hashes of signed
documents in it. The goal of the company was to adopt the smart contracts technology and hence a descriptive
analysis was performed, describing the particularities of the real estate business in Singapore thus modelling the
company’s business processes with the help of BPMN. The baseline solution was to propose a domain model for the
modelled process and build the proof-of-concept of a hybrid application, integrating a traditional web application
with Ethereum smart contract [15]. In addition, the solution was added with tampering-resilient document storage.
For this, a comparison was made between Ethereum Swarm and IPFS, so IFPS was chosen to go with. The
discussion concluded with the tradeoffs for moving a part of the application on blockchain and the challenges faced
by smart contracts, their possible solutions and reasoned decisions. Future modifications can be done by adding
escrows and timers in the process.
Sheikh H., et al., authors provide an overview of the benefits of smart contracts, over traditional agreements as well
as the technical details about their implementation. According to their research, it originated from multiple
industries, had different characteristics, and was adopted within different industries [16]. The authors also stated its
purpose within blockchain technology. It even presents the advantages of smart contracts which work together with
blockchain and the working of the same. Furthermore, the use cases of smart contracts in profuse sectors such as
healthcare, legal issues and real estate, government, supply chain and management have been introduced.
Additionally, the challenges faced by smart contracts and the hypothesis has been discussed, deducing that they can
result in unintended confusion as minor failures can lead to immense losses.
Konashevych O., explains how tokenization of the landed property can be done considering various aspects such as
legal and organization. The paper outlines how blockchain and distributed ledger technology can help to decentralize
as well as perform transactions of records of property titles. It introduces a methodology where tokens are generated
for every account that will represent the rights and titles related to a particular property. Meaning that a token on the
blockchain will point to specific land property [17]. Therefore the initial procedure of tokenization begins with the
land registration with the concerned authorities. Once the land’s token is generated and it has been titled on the
blockchain, there is no need to re-register it after each transaction. The researchers inferred that the process of
tokenization of real estate can be introduced as a parallel substitute to the existing system. In order for the
government to establish an integrated blockchain infrastructure and standards, it must establish security measures.
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Thus, introducing the concept of “cross-blockchain”, giving the freedom to users of which blockchain technology to
choose to manage their properties.
Kibet A., et al., present an evaluation of the efficiencies of smart contracts which are an integral part of blockchain
2.0 technology that can be used to address the issues present in the current real estate fabrication is discussed in this
paper. An overview of existing related studies is discussed, as well as a critical appraisal of them to rationalize the
need for blockchain models for housing markets. The first part of the article presents The Real Estate Property
Management Conundrum, followed by an examination of Existing Smart Contract Models for Housing, followed by
a detailed review of blockchain-based smart contract design. The proposed framework - Deposits will be paid in
ethers, the tokens, to a smart contract that contains the conditions and terms required to be abided by the parties.
Once the transactions are done and approved, the tenant gets the property and the landlord has been given the right
to decide how much of the funds to deduct till the period of tenancy. Apart from the deposit being paid in ether, the
rest of the rent instalments should be paid in the terms of ether tokens using smart contracts by the tenant. The
automatic payment requires access to the user’s account to transact the rent on behalf of the user [18].
Mashatan A., et al., Analyse the present state of the Canadian Landholdings industry along with the budding
impression that blockchain has. The authors are primarily interested in finding out whether governments should
invest in blockchain-based real estate processes. The paper describes the current bidding process in Canada and how
the real estate agents are involved in the process which might lead to the problem of “double-ending” [19]. The
authors present a “Transparent Bidding Blockchain (TBB)” process and an “Enhanced Real Estate Transaction”
process. In the TBB process, the bidding information for the property is collected without the middlemen's
participation and securely uploading them on the network of blockchain. The Bidding information is withheld from
the Seller's middlemen until the bidding is wound up, yet transited to them, reducing the possibility of deceit. In the
other process, a Smart Property Ledger(SPL) is introduced which is based on the concept of “coloured coins”.This
ledger contains all the history of the properties and also the steps which are taking place in the transaction of a
particular property. Thus the solution helps the users to get an update on the legal process and cancel out the
dependency on middlemen such as agents for the information. The paper is a work-in-progress whose scope is not
only limited to the Canadian real estate market but also outside markets.
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Nakamoto S., in this study, the authors suggest a P2P form of electronic currency that would allow payments to be
made directly from one user to another without the use of a financial establishment. The processing of electronic
payments on the Internet is almost exclusively handled by financial institutions acting as trusted external parties.
Even though the system performs well enough on most transactions [20]while still has the faith-based model's
fundamental flaws. Costs and payment concerns can be addressed by utilizing actual cash, but there is no way to
make payments without a trusted partner across a communication channel. A P2P distributed timestamp server is
used to overcome the double-spending problem by generating computational verification of the chronological
sequence of transactions. The system is safe till honest nodes control more CPU power collectively than any
cooperating group of attackers. It runs on a P2P network that uses proof of work to keep track of a publicly available
history of transactions that is computationally difficult to change if honest nodes hold the majority of CPU power.
Every node works at the same time without much coordination.
Latifi S., et al., in this research look into how blockchain is being used in the real estate industry and the benefits it
may give. The following are the results of the research so far: Blockchain technology and smart contracts can solve
the traditional problems that real estate has, and they provide far more instruments for a stable-priced market based
on game theory. The study proposes a mechanism that benefits all parties participating in real estate while also
ensuring that typical issues are avoided. In this article, issues such as investment devaluation resistance, maintaining
a fixed price, and attracting interest and earning are all important. The study specifies three characteristics: RE
tokenization, the use of a crypto exchange (CE), and the provision of an open-source mechanism. The
aforementioned approach can benefit tenants, owners, and investors alike. Furthermore, its STO-like structure helps
reassure investors that they will be able to budget for their future needs [21].
Alam S., et al., researchers propose the use of Blockchain to construct a secure and reliable land record system. At
various stages of the land registry, the proposed framework employs the concept of a smart contract and provides an
algorithm for pre-agreement. The study begins by describing the traditional land record system and examining its
problems with it. The research then discusses the advantages of using Blockchain technology in the land register
system, as well as a framework for doing so. Unique identification, initial transition procedure, consent principle,
and public disclosure of records or ownership databases are the four essential sections of a land register system.
Unique identification, initial transition procedure, consent principle, and public disclosure of records or ownership
databases are the four essential sections of a land register system. The current system's corruption has resulted in the
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rise of unidentified owners, as well as making the record-keeping process tedious and costly [22]. As a result, poor
farmers are unable to register land titles in their names, making them ineligible for government programs such as
low-interest loans, loan waivers, and crop support.
Bhatia K., et al., study present a concept for implementing blockchain in the real estate market in India, taking into
account government regulations. The Automatic Registrar Machine is an automated version of a registrar that
performs various tasks that do not require the intervention of a registrar. This machine might be installed in any
government office, bank, or other financial institution. streamlining the process for citizens and decreasing the
burden on a single government office Furthermore, unlike government offices, which have set hours and several
holidays, this machine would operate daily, similar to how ATMs in banks operate. Because blockchain has the
capacity to provide a trustless decentralised platform, it can help to eliminate many middlemen. A blockchain-based
association mechanism is presented, in which the land, its owner, and all other human parties involved are
authenticated prior to any transaction. Government officers are the main chain controllers. A particular machine
intended to process dapp transactions is known as an Automated Registrar Machine. This proposed method has the
potential to be adopted, bringing us one step closer to a clean and green economy. We save data and enable
considerably faster access to the transaction by using our bit manipulation approach [23]. Though this system does
not address the financial component, if it evolves toward blockchain, the future scope includes full integration with
the banking industry. The interoperability of blockchain would make this possible. This would be one of the most
significant strikes on corruption, terror financing, and other unethical actions currently taking place around the
world.
Yan J., et al., present a survey of blockchain research and development, as well as an introduction to the papers in
this special issue. The study shows that, while blockchain-enabled Bitcoin, is the most profitable cryptocurrency, its
use in banking and other commercial sectors will open up a plethora of new business and research options. While
there are numerous blockchain development initiatives in the works, blockchain research is still in its infancy. This
article presents research prospects for studying and validating blockchain applications in the business world, which
could encompass a variety of disciplines. Smart contracts integrated with commercial blockchains will transform
many industries by enabling automated business transactions that traditionally required significant human
participation. For example, in blockchain-based transactions, a combination of digital locks and smart contracts
will allow hotel rooms to be rented without the need for human participation [24].
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Ahmad I., et al., authors here proposed by offering a smart contract-based mechanism for recording real estate
transactions on a private blockchain, the work makes use of the core capabilities of blockchain technology. The
immutability of the blockchain ledger and transactions ensures that the real estate industry is protected. The parties
to a contract are given their digital keys, decreasing the possibility of deceit. The goal of this project is to figure out
how blockchain technology and the real estate business can be used to create a system that records all important
transactions on a privately maintained blockchain. In addition, the study determines the consensus mechanism's
nature [25]. There are four layers in the architecture: user interface, control, service, and the data layer. The system
suggests using a private blockchain to securely store transactions relating to property ownership and transfer.
References
Methodology
Advantages
Disadvantages
[14] [15] [18]
Ethereum based smart contracts
for Real Estate.
Seamless transactions
between parties and
governments. Eliminates
time delays present in the
current system. Handles
deposit claiming issues.
Scalability not tested.
Partially working
prototype. Smart contracts
restrict cash of the user.
Escrows not present.
[1] [2] [4]
Feasibility of implementation of
blockchain in RE based on
individual, societal, and market
perspectives.
Shorten transaction
procedures. Efficient and
seamless model.
Improved information
dependency. Overall
robust system.
The learning curve is
high. Fewer arbitrage
opportunities. Expenses
are high to build the
system.
Rationality-based,no
emotions.
[9] [11] [24] [6]
[20]
Decentralized peer to peer
network for data
management/transactions.
Elimination of third
parties in transactions.
Control of ownership.
Resilient system.
Log maintenance.
Lacks physical form.
Access keys can be lost.
Irreversible and limited
use.
[12] [5]
Blockchain’s Application in
Supply chain and IoT.
Improved real-time
tracking. Enhances trust
and security. Reduced
cost. Speedy transactions.
Non-flexible. Processing
power and time. Storage
hurdles.
Table 1. Blockchain implementations and outcome
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3. Methodology
Based on the above study of recent findings in the Blockchain Technology in Decentralized Real Estate
Marketplace, the research work proposes to create an end-to-end product for real estate transactions to take place. It
entails a web application through which sellers could list properties for sale or rent, investors could submit offers for
purchase. This application would be used by investors, sellers, and tenants after completing an online registration
process that would include KYC verification in order to create their accounts and participate in the network. Each
property would have a fixed value assigned to it in terms of tokens. Participants in the network will trade for the
Token in exchange for real money, and use these tokens to purchase a RE. These tokens will make users capable of
owning a property partially or fully. All RE transactions will take place on the Ethereum Blockchain platform, which
would use smart contracts to automate clearing and settlement. The rights holder of smart contracts publishes
ownership information on the blockchain and is automatically triggered to transfer usage rights. Following the
successful completion of a transaction, an Acknowledgement receipt would be issued in accordance with the terms
of the smart contract, making the receipt impossible to replicate.
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Figure 3. Architecture diagram of the proposed system
4. Discussion
The outcome of the study of literatures above can be observed that the Real Estate industry has realized the potential
of blockchain technology and how it could be used to overcome the drawbacks of the current system. Specifically,
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the research performed on the use of Ethereum based smart contracts shows great potential. A smart contract is a
self-executing agreement document that gets executed as soon as the agreement conditions are met. This enables
auto-verification of a transaction and eliminates the need for any third party, solving one of the major problems in
the RE industry of unnecessary broker or middle-men fees. A smart contract further smoothens the process of
transfer of ownership between one party to another. The smart contract is an immutable document thus forgery and
fraud are also eliminated. The research so far navigates along with all these advantages but still lacks details about
the complete implementation and scalability of the system. A lot of work has to be performed to make the proposed
system deployment ready.
5. Conclusion
The proposed study on the decentralization of Real Estate marketplace, and is evident by the outcome of proposed
work that there exist major issues that needed to be addressed in the pen-paper based system. The research as of
today suggests the use of blockchain, providing liquidity to the Real estate market and removing middlemen. The
concept of smart contracts and distributed peer-to-peer networks facilitate the achievement of this goal. The study
focuses more on theoretical aspects of the use of blockchain. Recent research discussed the use of tokens and a
consensus system to handle market inflation. However, it lacks clear implementation and proof of concept. This led
to the motivation behind addressing these issues and coming up with an end-to-end solution. The proposed system
will be available to any person upon successful registration and document validation. With this system in place, a
common man could avoid hassles of the real estate market and execute a transaction at his comfort. The proposed
system will provide a marketplace where all the parties involved in real estate can perform seamless transactions.
REFERENCES
[1] Denis Corluka, Ulrika Lindh, “Blockchain – A new technology that will transform the real estate market”, Royal
Institute of Technology, 2017
[2] Avi Spielman, “Blockchain: Digitally Rebuilding the Real Estate Industry”, Massachusetts Institute of
Technology, 2016
[3] Marcella Atzori, “Blockchain Technology and Decentralized Governance: Is the State Still Necessary?”, SSRN,
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Electronic copy available at: https://ssrn.com/abstract=4096395

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