What’s The Incentive For Commercial Real Estate Blockchain Adoption?

As some of you may or may not have noticed I have been on some what of a quest lately. And that has been to push out opinions points of view and all things BlockChain. Specifically blockchain and commercial real estate. I think it was Ardian Zagari Co-Founder & CEO of Brevitas who stated during a conversation recently “no one is even trying to write about this stuff but you.” Big thanks to Ardian for the props. I’m sure there are others, but they are indeed hard to find.

The article I wrote just recently titled The Three Dynamics of Crypto Destruction and Commercial Real Estate.  

Is just one example and it dealt with well, the three dynamics of crypto destruction.

-A quick side: I must be waaaay ahead of the pack on this. Not much interest if my views and stats are any indication. I’m not worried about that if I wanted numbers all I have to do is listicles and then listicles with more listicles. How fucking boring and for me a gratuitous act of self-flagellation.

The article did solicit a thorough and thought provoking response from David Music.

I’m loving your series on crypto and CRE. I’ve been following BTC, ETH, ETC, LTC, etc for years and completely buy into the value. I don’t just follow, I also have invested some. I’m also completely onboard the separate blockchain bandwagon. Individually each piece has value and together they have even more. Makes sense. The tokenization of Ethereum adds that much more value with the ability to program in smart contracts/apps.

The problem becomes the ownership side in your above equation (specifically in regards to CRE). The physical building worth $100m can show how that value is shared between different owners. On the data side, the value of the data will have a harder time splitting how the value goes to different parties. It’s the Google News argument all over – is the value from the search results (Google), the content (media companies), the pipe that delivers the info (ISPs) or some other party? In the long-run Google ends up reaping most of the benefit while delivering a secondary benefit to media companies (traffic/clicks on specific articles) that they have to figure out how to independently monetize.

Said another way, the value of the data around a physical building will likely not actually contribute a significant amount back to the physical building owners in the long-run. The value of the data will be allocated largely to those technologists who are best able to surface it and provide it back to others for use in currently unknown applications. In the short-term, early adopting owners may reap a windfall as their initial data will have intrinsic value that they can directly monetize but as more participate the value of each new data point/element becomes less valuable. The smart money (for owners) is to either be in the first 1% of adopters or to stay out entirely. Of course, this begs the question, is 1% adoption enough for create momentum for others to participate or is some greater threshold the minimum needed for the data platform to take off?

This is just where my head is around the topic. I’m struggling to really find the incentive for 20%+ of the CRE building ownership community to provide their data to power this. Separate from that, everything else works and makes perfect sense. Would love to see your thoughts on incentivizing this behavior as a future post.

So, to answer David I give you this:

As I did in the written article I will lay it out again:

Open network + shared data (layers) + incentivized tokens = Adoption

Open network and ” Allowing Connected Computers To Reach Agreement On Shared Data.” 

Shared data and to do that We Need A Tradable Data Marketplace And We Need To Build It Ourselves.

Incentivized tokens created by using Smart Contracts. The One Simple Step That Kills The DarkStar Forever.

Built on a platform like REXmls

Headed by this guy and the team at REX.

Now in response to David, I would call the above my commercial real estate solution.

To further answer his question and statement “Said another way, the value of the data around a physical building will likely not actually contribute a significant amount back to the physical building owners in the long-run. The value of the data will be allocated largely to those technologists who are best able to surface it and provide it back to others for use in currently unknown applications.”

We, as in #CRE are indeed in serious trouble.

To his point, “the value of the data will be allocated largely to those technologists  who are best able to surface it and provide it back to others for use in currently unknown applications.”

I could not agree more David.

And why?

Why?

Because of the dead on prediction of only 1% even seeing the reason to adopt.

Who does that leave the data to again? The technologists?

Or as I like to call them “the software and data companies.”

Unfortunately, NONE of them have anything to do with commercial real estate.

Especially the ones who claim that space NOW.

What are we doing again?

What will be the legacy that this generation of commercial real estate will leave?

Just like this last one.

Create all the data. Give it away and pay to get it back.

I’m stopping here.

Wait, one more time.

What’s The Incentive For Commercial Real Estate Blockchain Adoption?

The legacy for the next generation of commercial real estate will be?

Create all the data. Give it away and pay to get it back.

Or NOT!

 

+1. You can decide what to do.

+1+1 I already have.

 

Big shout out to David, thanks my friend, we don’t always agree and that’s the way I like it.

 

 

 

 

 

  • David Music

    Love it, Duke. Differing opinions usually get to a better outcome than groupthink and yes men.

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