Blockchain & Hernando deSoto: A Transpartisan Path To Reducing Poverty
BY A. LAWRENCE CHICKERING AND JAMES S. TURNER
Our friend Hernando de Soto wrote of ending poverty by recognizing property rights in our first (January 2017) issue of The Transpartisan Review. In the late 1980s and early 90s, de Soto played a key role in ending the Peruvian Terrorist group Shining Path’s violence by getting the Peruvian government to recognize poor property owners’ land deeds.
Today de Soto urges societies around the world to use decentralized digital ledgers, based on blockchain (similar to those used for bitcoin) to track the property holdings of the poor. His work, embraced by both left and right, and done with an idealistic staff at his Instituto Libertad y Democracia in Peru, highlights the importance of property rights for empowering people and mitigating poverty.
Property rights give the people more security and society as a whole more stability, de Soto argues. Formal deeds empower poor landholders. With bitcoin entrepreneur Patrick Byrne, de Soto has launched De Soto Inc., a socially-conscious joint venture between him and Bryne’s Overstock.com subsidiary Medici Ventures.
De Soto and Byrne’s vision is simple. Publicly record property rights and individuals’ claims, and globally verify them. This will enable the poor to safely unlock the value of their land. It will also help to resolve land ownership disputes and empower local land ownership.
De Soto Inc. aims to create a global property registry blockchain as a utility that will unlock dead capital, help five billion people secure modernized property rights, give information necessary to settle property conflicts and disputes, and fight terrorism by undermining terrorists’ business model.
De Soto is already doing some pilot projects. Byrne is selling part of his stake in Over-stock (worth $2bn) to pay for the projects. He has also assembled a bunch of Utah whiz-kids to begin creating a special blockchain form for the project. De Soto and Byrne ardently say they can persuade poor people to use social media to record their property rights themselves.
De Soto Inc. uses powerful information technology to empower a unique transpartisan initiative.
(Image from the video “An Interview with Hernando de Soto” – McKinsey & Company – which explores the effort to bring property rights and the rule of law to developing economies.)