One of the most significant problems of poor or undeveloped countries is a vulnerability to corruption. Honduras, one of the poorest countries throughout the Western Hemisphere, is no exception to this principle. The country has a history of susceptibility to land title fraud. In an effort to combat this, Honduras is working on implementing the blockchain to handle the registration and recording of land claims within the country.
Currently, the database responsible for handling these claims is centralized, and can be manipulated or hacked. As a result, bureaucrats within the government have taken advantage of this vulnerability to give themselves prime real estate throughout country. Essentially, individuals could give themselves ownership of beachfront property for free.
In a recent move, the government has decided to work with Factom, a Texas based company that specializes in data management via the blockchain. According to Factom’s president, the company will work on the project in collaboration with Epigraph, a title software company that also utilizes blockchain technology.
By using the blockchain, Honduras will create a title system that is completely transparent, as well as permanent. In addition, a blockchain based system also allows for easy and permanent title transfers. Overall, this system will lead to more secure contracts, mortgages, and mineral rights.
Negotiations for the project between the government and Factom began in January of this year. The project is expected to go live by the end of the year, and land claims will begin transferring to and registering on the blockchain. Once live, the project will make Honduras just the second country to utilize blockchain technology, behind Isle of Man.
More than 60% of Honduras’ total land is unregistered, but the government expects this number to decrease significantly once blockchain integration begins. As the blockchain will create an immutable registry, it is predicted that more people will begin registering their land, as they now have an incentive to do so.
Honduras has a reputation as a country defined by poverty and crime. With a GDP of just $1,577 per capita, Honduras is one of the poorest countries in the Western Hemisphere. The country, with a population of around 8 million, also holds the highest murder rate in the world. In 2012, there were 90.4 homicides for every 100,000 citizens.
The Honduras government has certainly lived up to its reputation in recent years. Since the global recession in 2008, the national debt of Honduras has quadrupled. Development since that date has been disappointing at best. However, the decision to incorporate blockchain technology is a good sign that the government has begun actively working to fix some of the more prominent problems within the framework of the country.
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