Dutch bank ABN AMRO has launched a blockchain application called Torch to help facilitate real estate transactions and exchange information.
Developed in partnership with IBM, the blockchain application is a sweeping ledger that will be accessible by every party involved in a real estate transaction. Such as, buyers and sellers, landlords and tenants, ABN AMRO – as a bank, notaries, appraisers; the Land Registry Office and the Chamber of Commerce which is the country’s business register; as well as other regulators.
Announced late last week, all of the above parties will – each in their own capacity – engage in a decentralized ledger that will make for more efficient record-keeping and access of information.
Torch will be rolled out in an application, wherein commercial real estate clients financed by ABN AMRO can enter their lease contracts for properties. The contract can then be validated by the client’s relationship manager. An appraiser could also value the property via Torch, with a bank employee sending details of the property. The appraiser then uses the same ledger to share the valuation report with the client or the bank.
Torch will also facilitate sharing of additional information from the Land Registry Office and the Chamber of Commerce. Further, the Dutch Central Bank will also have access to Torch and all of the above information, as the country’s financial regulator.
ABN AMRO has its reasons for picking blockchain technology as the core infrastructure for what could lead to a transformative change in the way information is recorded and accessed in commercial real estate.
The bank stated:
The potential of blockchain lies in the fact that trust is built into the technology’s design. In addition, it makes transactions programmable by means of so-called smart contracts.
The third-largest bank in the Netherlands has notably shown its fervor for blockchain development and applications in the past. In mid-2016, the bank partnered another financial institution Rabobank to research and explore the technology in a number of banking processes including cross-border payments, risk modelling and mortgages.
More recently, the bank announced a new partnership with the Delft University of Technology to quickly develop applications before mid-2017. As a part of the partnership, ABN AMRO staff will specifically attend blockchain application courses at the university to learn more about the innovation.
ABN AMRO is among thirty founding members of the now-100-strong Hyperledger initiative, an open-source blockchain project led by the Linux Foundation.The bank has also invested in prominent New York-based commercial blockchain startup Digital Asset Holdings (DAH) as a part of a $50 million funding round.
There are other examples of blockchain applications in real estate. A notable recent announcement revealed that the Kenyan government was already testing a pilot which sees land transactions and its details recorded on a blockchain developed by tech giant IBM.
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