In the Guangdong Province of China, Shantou was once a flourishing port city where European traders had their businesses and homes. In the early 1900s, they built a brand new central district near the river in Shantou with consulate buildings, apartments, bars and restaurants. It was a spectacular mix of Victorian English and classical Chinese styles and soon became a mainstay and provincial destination.
The Old Central District in Shantou
Over the years, however, Shantou lost its status as a top commercial hub, as bigger ports emerged in nearby Shenzhen and Guangzhou. As foreign traders left the city, the central district fell into a state of disrepair. Without the once thriving businesses, the local Chinese owners couldn’t maintain their own buildings and, as generations passed, descendants of the owners moved to newer parts of town.
Today, Shantou’s old central district is a dismal, rundown slum. You can still see the charm in the vintage architecture, but facades are falling to the ground and walls are crumbling. As random tourists stroll the lanes taking photographs, they wonder why the owners haven’t paid for renovations or sold the buildings to new owners who could fix them up.
Now Just an Empty Street of Crumbling Buildings
With No Ownership Rights, Nothing Can Be Restored
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Once a Popular Hotel in Old Shantou
Meanwhile, just north of Shantou, Chaozhou has a newly restored and booming old city, with shops, guesthouses, restaurants and people spending money. In other parts of China, old villages and districts like this one have been restored, drawing business owners, locals and domestic tourists.
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Gates To The Restored Old City of Chaozhou, Shantou’s Neighbor to the North
Because Chaozhou is a prefecture-level city, the government intervened to restore the streets and buildings. But in Shantou, there have been no renovations because no one in the city knows who owns the hopeless buildings: the deeds to the properties are nowhere to be found. If the deeds still existed, the buildings would be fixed, business owners would move in, and again it would become a busy district of the city. Eventually, just like in Chaozhou, the government will have to intervene with public funds.
But today, with the advent of the blockchain, technology can solve this age-old problem in Shantou. With the digitization (or tokenization) of assets, there will never be a need to keep a deed or piece of paper as records can be safely kept forever on the blockchain.
A Homegrown Solution
Based in Shanghai, Antshares is a Chinese blockchain led by developer Erik Zhang, who has studied Bitcoin and Ethereum, and believes China needs its own, homegrown blockchain solution. Having built Antshares as an open-source protocol, Zhang hopes that people in his country will soon be building apps and digitizing their assets with his technology. And by tokenizing real-world assets such as stock certificates, cars, homes and even people, Zhang believes he can help prevent what happened in old Shantou from happening again in the future.
Bitcoin Magazine interviewed Mr. Zhang about his plans for the tokenization of assets on the Antshares blockchain to find out how it works and what major changes it will bring to the world around us.
Bitcoin Magazine: How will the digitization or tokenization of assets work?
Erik Zhang: We usually divide digital assets into two categories, one for voucher assets and the other for credit assets. Digitizing a voucher asset means that we digitize contracts or licenses, such as the transfer agreement of a company's equity, stock certificates, a real estate license and so on.
A credit asset refers to the creation of a new digital asset and guaranteeing it as redeemable for a real physical asset in real terms. This can be done with an ounce of gold (or any quantity), a car, a Picasso painting, or as you mentioned, a home. It means creating a digital token that represents ownership of a physical asset, which can be bought, sold, transferred or stored in a secure manner.
BM: How is a digital token created?
EZ: Well, the answer is rather technical and perhaps boring for the average reader. But to do so on Antshares, for example, we would:
Create a numeric identity on the blockchain which can be implemented through a digital certificate. The digital certificate exists on the blockchain with a public key or address;
Use a private key of the digital certificate to register the commitment of the asset;
Safeguard the digital certificate and digital signature on the blockchain;
Allow other people to verify a digital identity through the digital certificate, and confirm the issuer/owner of the asset.
Once an asset is digitized, it can be transferred and traded on the blockchain, and there will be advanced operations that can be performed using smart contracts.
BM: So, in essence, what does this do?
EZ: Basically it records and protects data in a way that can’t be altered or transferred without the owner’s explicit consent. Consent, in these cases, will require a digital signature that can be verified on the blockchain. So if you have tokenized your home, for example, then your legal ownership of the home will be recorded by a digital “token,” and the fact of your ownership can only be changed or transferred when you have provided your private key (password).
In the case of Shantou, or anywhere else for that matter, this will also make it so that lost deeds will never result in such a public dilemma. Records of property ownership will never be lost, destroyed, falsely altered or transferred without consent.
BM: And what will we do with the tokens?
EZ: As far as securing our digital assets, advancements are being made in digital wallet technology so that we can safely store our digital assets. When you want to sell your property, then to complete the sale, you can transfer your token to the new owner digitally on the blockchain.
BM: So, in theory, anything can be tokenized. Do you think that someday we will tokenize ourselves?
EZ: (Laughs) Sure. I believe we will see birth certificates, marriage certificates, diplomas… and entire digital identities on the blockchain. In fact, digital identities are necessary for this whole ecosystem to work. Today, we use so many different types of personal identification: passports, ID cards, driver’s licenses, credit scores. With digital ID’s, people can build a single, comprehensive reputation on the blockchain which can be securely protected and used in any digital transaction. Tokenizing ourselves is a very important part of the future of blockchain technology.
BM: What kind of changes will this bring to the world?
EZ: Well, that is a big question with many implications. But in the case we see here, it will preserve the integrity of data and prevent the loss of ownership rights, such as we see in the case of Shantou. It will also have an impact on the environment as it will almost entirely eliminate the need for paperwork. But again, the implications of blockchain technology are so far-reaching that no one really knows of all the changes it will bring. We have many exciting ideas about it, but for the answer, we will have to wait and see.
BM: When will Antshares begin doing this?
EZ: Over the last year, we have made great progress with our core technology. This can be seen with the recent upgrades to our Antshares core wallet and our code updates on Github. We are a small, dedicated and talented team, and we will be working hard to build a community around our open-source platform. You will be seeing a lot of exciting news from Antshares in the near future.
Read more about other blockchain solutions for land and title registry around the world