A Match Made in Heaven: Tree Huggers & Blockchain

By Tony Sagami on April 29, 2019

30% of earth is covered by forests. Sounds like a lot, right?

Well, that percentage used to be 44%. The Amazon rainforest in Brazil is where some of the most rapid deforestation is happening. In the last 50 years, 17% of the Amazon rainforest has disappeared.

In the last year, 5,000 square miles of forest were cut down in the Amazon. That's about the size of Connecticut. Plus, the pace of deforestation is accelerating; that was a 13.7% increase in the last 12 months.

Some of that deforestation is legal, but a lot of it is illegal because of the immense profits that thieves can get from selling the felled trees.

Not only does illegal logging leave a gaping hole where ancient trees once stood, but it robs the local communities of economic livelihood.

The situation sounds hopeless. But there is hope for a very good solution … and it's one you can invest in.

Beyond the Economics
of Illegal Logging

The real problem with illegal logging is that Brazil has an antiquated centralized land registry that contributes largely to the problem. Unscrupulous land-grabbers bribe government officials to issue forged deeds that enable them to illegally cut down trees … and get away with it.

The problem is so severe that the Brazilians even have a name for these fake property owners: "fantasmas," or ghosts.

When these illegal land grabbers sell the logs, nobody asks questions.

However, the Brazilian government is building a blockchain-based land title system. One that will bring transparency to land ownership and make it impossible for the "fantasmas" to use fake land deeds to steal logs.

Brazil's Real Estate Registry Office wants to put every acre of land ownership into an immutable blockchain record, which would make it impossible to fabricate or falsify land deed paperwork.

Brazil isn't the only country using blockchain to secure property titles. The Netherlands, Sweden, India, the United Kingdom, Dubai, Colombia and even the state of Vermont are incorporating blockchain into their property registries.

Blockchain-Based Property
Ownership Recording System

You see, keeping track of ownership is difficult when you have hundreds of years of property records, forged documents, counterfeit titles, or a loss of all documentation in disasters like fires and earthquakes.

Blockchain is the perfect fit for use in public records systems because of its security and accuracy.

Blockchain by itself won't put an end to deforestation, but it's a giant step in the right direction. And the companies helping secure property records with blockchain are going to make a bundle.

At the same time, I would be reluctant to own stocks of any companies that profit from the current system of land ownership tracking, such as:

  • First American Financial Corp. (FAF)
  • Fidelity National Financial Inc. (FNF)
  • Investors Title Co. (ITIC)
  • Old Republic International Corp. (ORI)
  • Radian Group Inc. (RDN)
  • Stewart Info Services Corp. (STC)

The title insurance business is a good place to look for blockchain-related investments. But this isn't the only industry that is going to be disrupted by blockchain, which is going to cut out millions of costly middlemen.

Take a hard look at your portfolio. Is it filled with cost-increasing middlemen who can be cut out with a blockchain solution? Or is it filled with companies that are on the blockchain's cutting edge?

If you want the latter, and all the profit potential balanced with limited risk that they offer, click here.

Best wishes,
Tony Sagami

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