Post written by Stephen King Founder, CEO Imbrex.

Real estate is among the oldest and most foundational industries on earth. Shelter is imperative for human survival and integral to most human activities, which is why it is one of the largest asset classes on the planet — valued in 2015 at $217 trillion.

Over the last five millennia, little has changed in the way we transact these physical assets. From listing a property to closing the deal, multiple stakeholders, data sources, service providers, regulators and government agencies take their place between sellers and buyers, contributing friction, paper, redundancies, errors, waste delays and costs.

Ask any real estate professional to describe her day, and you’ll hear about the challenges she faces when it comes to listing exposure, data accessibility and transaction delays. If a broker wants to locate a property in New York City, he can search several different portals and see the same property listed under varying names. If an agent wants to attract an international buyer, he has to take additional marketing steps to obtain global exposure. To close a deal, paperwork is passed back and forth in the form of email that often leads to miscommunication and transaction delays.

While there have been a range of investments in real estate technology in recent years, most people are struggling with much the same problems as they’ve always had. Those problems will persist as long we continue to approach them with solutions that do not take into account the fundamentally interconnected nature of real estate, the data that defines its ownership and its value. By establishing a base layer of universally accessible and usable data, information and records, we can literally reinvent real estate from the ground up.

Step one is creating an international standard for property data.

Six years ago I was expanding a commercial real estate brokerage when I realized that the cost and access to our own data was eating into our bottom line. I built a tool that would make it easier to obtain and disseminate data in a more cost-effective manner. I learned that it was virtually impossible to pull data due to end-user licensing agreements while pushing data proved just as inefficient. I shut down development when, serendipitously, I came across Ethereum. Ethereum was proposing to take Bitcoin’s core technology, the blockchain, and apply what are called smart contracts. Smart contracts digitally facilitate, verify or enforce the negotiation of a contract. They enable the execution of transactions without third parties.

As I was exploring the technology I found myself down another exciting rabbit hole called the Interplanetary File System (IPFS). Juan Benet, a recent Stanford graduate, was proposing a new peer-to-peer data distribution protocol that would decentralize data storage. The success of IPFS has meant a transformation of digital data storage, our digital information freed from centralized captivity and cast on a nomadic journey around the world. We can envision IPFS with email: Today, I send you an email using Gmail. The journey is from my computer to Google’s server to your computer. With IPFS, it could go from my computer to your computer (or the shortest possible route).

Combining the two technologies, I realized, we could syndicate the world’s real estate networks while simultaneously establishing data standards. These standards are necessary in the technology’s progression from safely and securely transferring digital assets (cryptocurrencies) to doing so with physical assets (real estate).

The blockchain provides the ability for us to create open communication channels between the existing real estate networks. These channels create publicly owned ecosystems that transfer the control of the data back into the hands of the individuals and corporations generating it. The public ecosystem is not owned or controlled by one single entity but rather by the community members themselves.

With the blockchain, we can assign each property a unique identifier (a hash) that is permanently recorded on a global ledger. To verify an address, users can cross reference the property’s name with its recorded hash. This universally accessible identification system for property is the necessary bedrock on which a new real estate ecosystem can emerge.

Imagine the example above, where the agent takes additional steps to maximize exposure due to uncommunicative systems. To provide a solution, you need to get the seller, agent, firm and buyer on board with a new system. Traditionally, this failed due to the lack of incentives. However, with the blockchain, we can empower the firm and agent to take control of their information while providing a conduit to a global marketplace. The seller benefits from increased exposure and the buyer has access to localized, user-curated information.

Often when people think about blockchain and real estate, they gravitate toward transaction instruments like title. However, without data standards setting the stage for universal communication and exchange, we’re headed in the same direction once again: siloed data accessible via disconnected and unsecured processes and the intermediaries required to make them work.

Challenges like scaling, privacy, identity, regulation and cross chain interoperability still need to be overcome. Some of the biggest challenges we’ve faced are in translating new concepts like tokenization, virtual wallets and gas (or computation) fees into a user experience that is similar to existing platforms. It’s still early days in blockchain technology development, but the future looks bright.