The decision to use blockchain for the rental market was declared by Joseph Muscat, the Prime Minister of Malta. This means that every rental contract in Malta needs to be registered on a blockchain. A blockchain is a distributed ledger – a database – that contains an ever-growing list of records in a block that is secured from tampering and revision.
The reasons outlined by Muscat for transiting to this digital system are: improved security, to stop record tampering and to ensure that only authorized persons can access rental records. There is also a fraud reduction element in that blockchain counteracts the chance of there being contracts in place for which there is no record, thereby cutting down on fraud.
A decentralized platform for the rental process also improves ease of use, including e-documents and e-contracts. Furthermore, the goal of blockchain platforms is to automate the rental process and also to lower operational costs, meaning that the cost of rental transactions might actually decrease.
Speaking in a radio broadcast, Muscat said: “We will now be showing people the added value of this technology through applying it to something which they will use in their daily lives. This shows how the digital transformation will affect their lives.”
The Prime Minister further explained that his government would be unveiling the complete details of the proposed rent reform, which comes after a lengthy consultation period, over the next few days.
Blockchain is a big industry within Malta, to the extent that the country is sometimes referred to a “blockchain island”. This is in recognition of Malta’s relatively relaxed regulatory framework which is designed to encourage both cryptocurrency exchange and the application of distributed ledger technologies.
