36,000 words white paper to challenge the real estate "Lemon Market" – Hangzhou "create the second generation" to prepare for the ant blockchain competition

"The sentence in your chest is what your boss said, Computing is power, power (calculation) is power."

For Xu Ruochen, Chang’s theory has profoundly influenced his values ​​in the blockchain world. Before the official interview, he saw that the Babbitt reporter was wearing a cultural shirt than the original chain, and could not help but say the above sentence.

Xu Ruochen is one of the participants in this ant blockchain innovation competition . His project is also the only blockchain project in the competition that combines with commercial housing. At the same time, he was a “ second generation ”. After receiving a master's degree in international real estate and planning from the University of London in 2012, he entered a real estate developer in Hangzhou , responsible for marketing, engineering and strategic development.

In Xu Ruochen’s entrepreneurial story, we don’t see the “decentralization” of fundamentalists, nor the “subversion” or “revolution” that the outside world often said. He is more like a simple peasant, quietly cultivated on the "blockchain +" land that needs to be pioneered .

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He said that he did not have much faith in the blockchain, but he hoped that "by adjusting the production relationship and turning the strong center of the real estate industry into a multi-center, this is a great improvement in itself."

Xu Ruochen’s team is currently stationed in the Babbitt Accelerator. The team has a total of 6 people. Xu Ruochen sits near the inside of the window.

First knowledge blockchain

In June 2018, Baidu launched the first blockchain original product–"degree universe", ant Jinfu announced the launch of blockchain cross-border remittance services, Ma Yun, Zhou Hongyi, Feng Lun, Sun Zhengyi and so on. Published a view on the blockchain.

In June, Xu Ruochen first learned the concept of “blockchain” in the WeChat circle of friends . At that time, he did not think about combining the blockchain with real estate, but "the blockchain's reputation at that time was very big. Whether it was useful or not, as a company executive, it is necessary to understand."

Reading is the first step in his understanding of the blockchain. Thus he knows the basic concepts and operating principles of the blockchain, and also understands the theory proposed by Changchun. He is deeply attracted by the idea of ​​blockchain , and he still remembers a description of the smart contract in the book:

“When the dishwasher's detergent is running out, the smart contract will pay the supplier to the supplier, who will send the new detergent. When the dishwasher is idle, its chip can also be used. In mining, the benefits are just enough to buy detergent and achieve self-sufficiency."

In the following months, the digital currency market continued to be sluggish, and the large-scale commercialization of the blockchain was delayed. He found that “the blockchain is not so magical and not omnipotent.” Because there is a blockchain With a more rational understanding, he came up with the idea of ​​“blockchain + real estate”.

On October 28, 2018, Xu Ruochen participated in the activities of the famous Babbitt School (Zhejiang University Station). After the event, he talked with the director of the original chain, Ma Qianli, about the topic of “blockchain + real estate” .

Ma Qianli suggested that he should not choose the direction of renting, because most of the domestic teams engaged in “blockchain+real estate” are doing to C (user-oriented) rental, but due to technical and policy supervision, the project is progressing slowly.

Later, Xu Ruochen also considered the direction of second-hand housing, but the second-hand housing is mainly based on individual passengers, and the operation is difficult. Finally, he chose the most familiar commercial housing as the entry point, based on the underlying platform of the alliance chain , to build a commercial housing development and trading platform with G-end (government) as the core user .

The pain point of the real estate industry

In 1970, the American economist George Akerlof proposed the concept of " lemon market ." He pointed out that in the market, when there is information asymmetry in the goods for sale (the seller knows more about the goods than the buyer), it is easy to cause market failure and even the phenomenon of “bad money driving out good money”.

Xu Ruochen believes that China's commercial housing market is in the "lemon market" state , he used data to demonstrate his views:

Since the premise of the "lemon market" is that "the seller is more aware of the goods than the buyer", it is easier to take place in the market dominated by the seller; while the total inventory of commercial housing at the end of 2018 in China is 524.14 million square meters, according to the total annual output of 171,654,400 square meters in 2018. The sales speed, the de-singing cycle is only about 3.7 months, significantly lower than the 6-12 month supply and demand balance interval, is a typical seller market. In addition, the commercial housing market itself has serious information asymmetry. There is no doubt that China's commercial housing market is in the "lemon market" state.

What does the “lemon market” mean for the commodity housing market? Xu Ruochen takes the Hangzhou commercial housing market, which is currently being dominated by the seller, as an example, summarizing the major pain points caused by information asymmetry in the transaction process:

The first is to increase the price in disguise and reluctantly sell it . The developer uses the bundled parking space, fine decoration, or the use of counterfeit fees and other means to break through the government-directed filing price; or by finding internal employees to sign fake contracts and other means to create the illusion that the house has been sold, thus rejecting the reasonable purchase demand .

Second, the configuration shrinks . The developer secretly reduced the park, house or fine decoration configuration promised in the advertisement, and achieved the purpose of increasing profits by compressing the cost; even if the consumer realized that the configuration was shrinking, it was difficult to argue because there was no clear evidence.

The third is the crazy compression period . Some real estate giants are in pursuit of high turnover and excessive compression period, which leads to the failure of the quality of the project. However, some local governments are relatively relaxed in the approval and acceptance of the giants. The media is forced by the giants as the advertising owner and the public is not informed. Symmetrical and unable to form a regulatory force. In the end, due to the lack of supervision, production safety accidents have occurred frequently in recent years.

Although the "lemon market" is more likely to occur in the seller's market, even in the buyer-led market, there are still a lot of pain points such as false advertisements, substantial reductions, contract disputes, and mediation chaos.

In addition, in the development of commercial housing, due to the excessive participation of the supervisory entities (the project cycle involves dozens of units) and the lack of mutual trust (each unit is an isolated island of information), the whole process is lengthy and inefficient. It takes one year and half a year after the comprehensive acceptance, which makes the friction cost of the developer in the development cycle very high.

In response to these pain points, the characteristics of the blockchain's transparency, non- tamperability and consensus mechanism can solve the corresponding problems. Xu Ruochen said:

If the pre-sales plan of each real estate listing is uploaded to the blockchain platform, then if the consumer decides to purchase the house, the contract can be completed directly on the platform. As long as the customer is willing to match the pre-sale price of the listing, the smart contract will activate and execute the purchase process. All kinds of disguised price increases, reluctant to sell, will disappear.

In addition, if the government agencies, institutions, banks, etc. involved in the real estate development process are introduced into the consensus, the developers will be able to change their land acquisition, project approval, project loans, construction, and acceptance. Effective and save a lot of friction costs. He added that since the real estate starts from the land acquisition, the acquisition of various licenses and the filing of key information are kept in the blockchain platform according to the time stamp, and cannot be tampered with, so consumers can understand the e-commerce platform than the existing real estate. More abundant and real estate information broke the information asymmetry of the market.

On February 24, 2019, Xu Ruochen completed the preparation of the project white paper. The full text of the white paper is 36,000 words, covering the status quo and pain points of the commercial housing market, technical highlights of the blockchain, project advantages, technical architecture and development roadmap.

Just as he was preparing to use the Hyperledger Fabric to build a business scenario, a roadshow changed his plan .

Attached to the ant block chain

On March 5, 2019, Xu Ruochen participated in the activities of the Ant Block Block Innovation Competition Road Show Hangzhou Station . Looking back now, the event left him with the most profound feelings:

First, "everyone is very sincere. (Ant) Although it is an industry giant, there is no feeling of being above the top, just like a group of entrepreneurs promoting their products." Second, let him know that "there is a new option". After all, Hyperledger is a foreign project. Although there are offices in China, the consulting efficiency is relatively low.

In this way, Xu Ruochen and the ant block chain have a fate, he said,

"For a traditional company like us that has not been exposed to the Internet industry, getting involved in the blockchain is like driving in the desert. Participating in the contest is equivalent to someone leading you in the lead and urging you behind.

In addition, the ant blockchain is a financial-grade blockchain technology platform that fits well with the financial attributes of our projects. In addition, in terms of government resources, if our government resources can be combined with the resources of ants, it will certainly speed up the project. ” On the technical level, Xu Ruochen said that the project will use as many intelligent contracts as possible in the ant blockchain, and use its automated, non-tamperable and traceable features to solve the pain points in the commercial housing market. He particularly emphasized the role of the oracle blockchain's oracle (Oracle) technology .

The oracle is an implementation mechanism for the interaction between the blockchain and the external world. The trusted execution environment enables external data to enter the blockchain safely and reliably.

Later, on March 29, 2019, the ant blockchain held a technology open day in Huangpu District, Shanghai.

In the communication with the ant blockchain expert, Xu Ruochen gained great confidence . "As a newcomer to the 'chain circle', from that event, I can feel the ant's attention and affirmation of our project."

Xu Ruochen said frankly that he is not a technical background. Although he has rich business experience and blockchain concepts, the technical aspects are inseparable from the help of ants.

"We have technical communication every day, and the other side is almost a second. In mid-April, the ants also gave us a 45-minute technical question in the Alipay building."

The cooperation between Xu Ruochen and the ant blockchain has just begun, and there are still many challenges waiting for them in the future. On the road of "blockchain +", which is full of unknowns, everything is the beginning of no ending, and everything is a fleeting pursuit.

It is the entrepreneurs who come from traditional industries like Xu Ruochen. It is the technology platform like the ant blockchain. We can see that the era of “blockchain empowerment of the real economy” is accelerating.

On June 6, 2019, the fourth stop of the Road Show , an ant blockchain innovation competition sponsored by Ant Financial and hosted by Babbitt, will be held in Wuhou District , Chengdu . The event invited technical experts and user representatives of the ant BaaS platform to introduce the advantages, ecology and application scenarios of the ant blockchain.

Some people sighed and lost their youth, history is over; some people sing the world so new, everything has not yet been named. Driving to the "blockchain +" new tomorrow, it will be one of you. Scan the QR code to sign up or click on the link : https://www.chainnode.com/event/330250

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