This article seems to conflate using the block chain to verify title transfers, with using Bitcoin to buy/rent property, as it discusses both without really drawing a distinction.
Can anyone make sense of what's going on here, and in particular why a municipality would prefer a block chain to a public database of digitally signed records?
It would allow two private parties to transfer title between themselves without permission or action by the municipality.
Not sure why the municipality would want that. Also would create a slew of issues around what happens if you lose the private key to your house, or worse, it gets stolen.
It also seems to conflate online access to land records with bitcoin.
It's possible that the same folks that pushed MERS (trying to move land records out of county systems and into a private, mortgage industry-controlled system) may be pushing this as a second attempt at the same (just with the word "blockchain").
The only way it makes sense to me is as a further means of authenticating exactly what was done and who the parties were. See "Triple Entry Accounting" for a similar concept (added value from blockchain use): http://iang.org/papers/triple_entry.html
Many jurisdictions don't need signed records. Many Americans can deed property among themselves without touching a public database. There are surely reasons why one might want to register such a deed, but it isn't an absolute requirement. I do scratch my head at the desire to use blockchain tech in areas where absolute assurance isn't needed or even desired. And to implement such a system in an area as diverse as contracts and real estate seems folly. What happens when we want to do something that the blockchain's design hasn't anticipated?
For the same reason a group of banks would prefer a blockchain despite not having to worry about the Sybil attacks that motivated it -- it sounds modern and high tech and fancy.
In Canada, buying/selling Bitcoin is subject to capital gains in the same way buying/selling stocks are. I wonder if you have to pay capital gains if using Bitcoin directly as a currency- as in through the purchase of a house or other expensive asset.
I'm about to buy a house (US) and considered that very issue. I asked an accountant and the answer was that, yes, I'd need to pay capital gains tax on the gains.
On one hand it makes sense, but on the other hand, it could be seen as a diversification into real estate. If instead of personally buying the Bitcoin and house, I bought shares of "moduspol mutual fund", and then that mutual fund bought the Bitcoin and diversified into part of my house, I presumably wouldn't be taxed until I sold my shares in "moduspol mutual fund."
But it's a good problem to have, and probably not worth (legal) avoidance at smaller (< $1 million) values.
CRA (Canadian's IRS equivalent) says bartering creates a taxable event, be it Bitcoin or turnips. Whenever you do the trade, you're supposed to calculate the value of what you're offering in Canadian Dollars. So buying in Bitcoin is not very different than buying in US Dollars.
Would you be charged capital gains taxes if you wanted to make a straight-trade of real estate properties, or would there need to be a symbolic changing-hands of money on paper, and thus taxed on each side?
I can't claim to be trading real estate properties, or even buying and selling them (long live Toronto real estate market...) so I have no idea. I know it's a weird scenario, but just in an attempt to find an analogue — anybody?
edit: This question was an attempt to create a more relatable analogue scenario for a BTC <> Real Estate transaction. Thanks for the info.
How will any kind of blockchain used for real-estate be de-centralized? My guess is that it will be centralized. No government would give up that much control over the property within its borders. Governments want authority to be the first to add property to the ledger to ensure it starts off in a valid state. Governments want to have the authority to seize property and enforce court decisions as well. People could get hacked and suddenly someone else owns their home, but with a centralized system, even if the government gets hacked and all property stolen, they simply fork off a previous block that was known to be valid and proceed as usual.
Thanks. I can’t circumvent the paywall either with Google, nor Facebook, nor the E-Mail URL trick.
I seriously wish by now links to paywalled content that aren’t archived versions should be banned from HN, especially now that circumventing these paywalls is basically impossible.
Article headline implies Bitcoin can be used in real estate deals. Article itself describes how blockchain techniques may be used in real estate record keeping. This aligns with my understanding of how bubbles are promoted through confusion tactics, via financial press as complicit agents. Mental Note; don't touch cryptocurrencies with a barge pole.
Well, WSJ and Wall St are interesting in bubbles of all kinds, so, of course, just like ever before, they would do anything possible to separate stupid people from their money...
Great way for Chinese buyers to go straight from electricity bill to Canadian/Australian/Californian real estate without even moving any currency. Money laundering and capital control problems solved!
(OK the article looks to be about blockchain for confirming transaction rather than paying - but the joke still holds)
I don't see this comment as helpful. Bitcoin, and other crypto currencies, is akin to the internet when it was first introduced. It has the potential to disrupt the value business which is controlled by governments at the moment.
Worse, a lot our value system is controlled by corporations that have fees littered throughout every single transaction we do today. Crypto-Currencies have a chance to disrupt a system that is increasingly not good for the common person.
Secondly, Chinese buyers area already visiting the US and buying property and they pay cold hard cash. So not seeing what your point is here.
Are you suggesting the massive paper trail of buying a house could be circumvented single-handily by pseudonymous cryptocurrencies?
Money laundering is a favourite catchall term law enforcement likes to use to label something as bad while ignoring all the context around the action. There are plenty of ways to catch tax evasion and other crimes without centrally controlled currencies. This is probably one of the worst examples to support the cryptocurrency = opening the floodgates to crime narrative...
[+] [-] paulgb|8 years ago|reply
Can anyone make sense of what's going on here, and in particular why a municipality would prefer a block chain to a public database of digitally signed records?
[+] [-] cwkoss|8 years ago|reply
Not sure why the municipality would want that. Also would create a slew of issues around what happens if you lose the private key to your house, or worse, it gets stolen.
[+] [-] Chirael|8 years ago|reply
It's possible that the same folks that pushed MERS (trying to move land records out of county systems and into a private, mortgage industry-controlled system) may be pushing this as a second attempt at the same (just with the word "blockchain").
The only way it makes sense to me is as a further means of authenticating exactly what was done and who the parties were. See "Triple Entry Accounting" for a similar concept (added value from blockchain use): http://iang.org/papers/triple_entry.html
[+] [-] sandworm101|8 years ago|reply
[+] [-] bradleyjg|8 years ago|reply
[+] [-] unknown|8 years ago|reply
[deleted]
[+] [-] badloginagain|8 years ago|reply
[+] [-] moduspol|8 years ago|reply
On one hand it makes sense, but on the other hand, it could be seen as a diversification into real estate. If instead of personally buying the Bitcoin and house, I bought shares of "moduspol mutual fund", and then that mutual fund bought the Bitcoin and diversified into part of my house, I presumably wouldn't be taxed until I sold my shares in "moduspol mutual fund."
But it's a good problem to have, and probably not worth (legal) avoidance at smaller (< $1 million) values.
[+] [-] hamstercat|8 years ago|reply
[+] [-] tryingagainbro|8 years ago|reply
You bought Bitcoin at $1 and sell at $8000 to pay for a house, you need to declare income of $7999 for each Bitcoin at the end of the year or else...
[+] [-] 52-6F-62|8 years ago|reply
Would you be charged capital gains taxes if you wanted to make a straight-trade of real estate properties, or would there need to be a symbolic changing-hands of money on paper, and thus taxed on each side?
I can't claim to be trading real estate properties, or even buying and selling them (long live Toronto real estate market...) so I have no idea. I know it's a weird scenario, but just in an attempt to find an analogue — anybody?
edit: This question was an attempt to create a more relatable analogue scenario for a BTC <> Real Estate transaction. Thanks for the info.
[+] [-] test6554|8 years ago|reply
[+] [-] nikolay|8 years ago|reply
[+] [-] uptown|8 years ago|reply
[+] [-] kuschku|8 years ago|reply
I seriously wish by now links to paywalled content that aren’t archived versions should be banned from HN, especially now that circumventing these paywalls is basically impossible.
[+] [-] bernardlunn|8 years ago|reply
[+] [-] riazrizvi|8 years ago|reply
[+] [-] nikolay|8 years ago|reply
[+] [-] rb808|8 years ago|reply
(OK the article looks to be about blockchain for confirming transaction rather than paying - but the joke still holds)
[+] [-] jenga22|8 years ago|reply
Worse, a lot our value system is controlled by corporations that have fees littered throughout every single transaction we do today. Crypto-Currencies have a chance to disrupt a system that is increasingly not good for the common person.
Secondly, Chinese buyers area already visiting the US and buying property and they pay cold hard cash. So not seeing what your point is here.
[+] [-] dmix|8 years ago|reply
Money laundering is a favourite catchall term law enforcement likes to use to label something as bad while ignoring all the context around the action. There are plenty of ways to catch tax evasion and other crimes without centrally controlled currencies. This is probably one of the worst examples to support the cryptocurrency = opening the floodgates to crime narrative...
[+] [-] neurotech1|8 years ago|reply
[+] [-] valsoltow|8 years ago|reply
[+] [-] revmoo|8 years ago|reply
[deleted]