Page 25 - bne magazine March 2017 issue

bne March 2017 Companies & Markets I 25
bne:FinTech
Republic of Georgia and The Bitfury Group to expand blockchain land-titling project
Nicholas Watson in Prague
One of the most promising applications for Blockchain technology – the underlying solution that powers cryptocurrencies like Bitcoin – is securing land titles. The Bitfury Group, one of the world’s leading blockchain technology companies, and the Republic of Georgia have been pursuing this exact opportunity. A pilot project in Geor-
gia, launched in April 2016 in partnership with The Bitfury Group, is progressing so well that the two sides on February
7 announced that they have agreed to advance it to the next level, while also signing a new memorandum of understand- ing to expand the project to other government departments.
It’s not surprising that Georgia is at the forefront of efforts to implement Blockchain solutions in govern- ment processes. Since the “Rose Revolution” in 2003 that ushered in a radically reformist government intent on moving past decades of communism and centralised planning, the country has progressed to the point of hav- ing a well-functioning market economy, which the World Bank now ranks as 16th in the world in its latest “Doing Business Index”. A big part of those reforms has involved trying to apply innovative technologies to areas of gov- ernment to make them more efficient and transparent.
Georgia’s relatively small size and well-educated popula- tion, together with it being a transition economy push- ing to achieve Western standards of governance, makes it the ideal country in which to pilot such projects.
In the World Bank study, Georgia also performed extremely well in the “registering property” category, coming in 3rd place in the ranking of 190 economies. Registering a prop- erty in Georgia requires just one procedure, which takes one day and costs 0% of the property value (a simple fee
of between $50 and $200 is levied, depending on how quickly the parties want the transaction to be notarized). A new online registry of property was launched in 2007- 2008, which is administered by the National Agency of
Public Registry (NAPR). The method of securing changes to that registry is what The Bitfury Group and the NAPR have been working on for the past year, successfully imple- menting a tailor-made Blockchain system that is now integrated into the digital records system of the NAPR.
This private Blockchain is anchored to the public Bitcoin Blockchain through a distributed digital timestamping service, which allows the NAPR to verify and sign a docu- ment containing a citizen’s essential information and proof
“This is just the first of many
creative solutions projects Bitfury
is developing in concert with Georgia and the Blockchain Trust Accelerator to better serve its citizens”
of property ownership. The important time-stamping service also allows citizens to ensure their documents are legitimate without exposing confidential information, which is made possible by providing citizens with unique documentation known as a “hash”. This document hash is published to the tamper-proof Bitcoin Blockchain and can be verified whenever a request is made, meaning that it is impossible for any central authority or malicious third party to corrupt it without everyone knowing. Not only will the Bitcoin Blockchain make the property registry system safer, but it will also make it more efficient and thus cheaper.
The Bitfury Group and Georgia are continuing to advance the project to include smart-contract capabilities to stream- line business operations for NAPR. This next phase of the
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