Dubai has scored another world's first, by becoming the first city to adopt the blockchain technology that powers the cryptocurrency, for some of its official transactions. In a first of its kind global initiative, the Dubai Land Department, the government arm responsible for the registration and regulation of real estate in the Emirate, is now processing and implementing all real estate transactions on a blockchain. Ultimately, all Dubai properties will be recorded on a blockchain within two to three years.
Dubai's dogged drive in becoming the world's first blockchain city is gathering pace with everything, from its airport to a citywide payments system and even an official state cryptocurrency set to be powered by blockchain technology.
The initiative is part of the Emirate's wider 'Dubai Blockchain Strategy', which aims to record and process 100 per cent of all documents and transactions on a blockchain by the year 2020. The sweeping blockchain mandate was announced by Dubai Crown Prince Hamdan bin Mohammed, in October 2016.
The Dubai experiment should serve as a reference for similar initiatives being planned in other parts of the world, including in India, where the authorities are considering the launch of an official cryptocurrency. According to reports, the Reserve Bank of India is considering a proposal to introduce India's own cryptocurrency and the proposal has already been discussed by a committee of officials. Reports say the Indian cryptocurrency may be named Lakshmi.
Nick O'Connor, a global expert on cryptocurrency, has hailed the Dubai initiative as the first instance of the real-world crypto transformations disrupting the society.
"A year ago, the notion that blockchain could be used to power an entire city would have seemed far-fetched. But that's exactly what's happening in Dubai right now. With everything from its airport, to the citywide payments system and even an official state cryptocurrency powered by blockchain technology is now in development," Nick noted in his advisory to investors.
Japan could also place its entire property registry on a blockchain by unifying all property and land registries across urban, farmland and forested areas – including 230 million plots and 50 million buildings – by the year 2023, Nick pointed out.
"This is a revolution that's happening right before your very eyes. In my view, it's not a bubble – it's gone way past that stage," Nick O'Connor said.
This week bitcoin smashed through the $4,500 barrier once again – peaking at $4,614. Its market cap was up 5 per cent in one day, reaching $76.662 billion.
According to the Dubai government, the Dubai Land Department has created the blockchain system using a smart and secure database that records all real estate contracts, including lease registrations, and links them with the Dubai Electricity & Water Authority (DEWA), the telecommunications system and various property related bills.
Blockchain's secure, electronic real estate platform incorporates personal tenant databases, including the Emirates Identity Card and the validity of residency visas, and allows tenants to make payments electronically without the need to write cheques or print any papers. The entire process can be completed electronically within a few minutes at any time and from anywhere in the world, removing the need to visit any government entity.
The blockchain has been developed by the Emirates Real Estate Solutions (ERES), the DLD's technical arm, in collaboration with a number of other partners including, the Emirates Identity Authority, DEWA, Wasl Asset Management Group – one of Dubai's largest real estate developers and Emirates NBD, the emirate's largest bank.
(The views expressed are strictly personal.)