Land Administration in Afghanistan: UN Looks Towards Blockchain

This article describes the cooperation of three companies, which resulted in a land registry secured by blockchain technology.

Intro

The blockchain has arrived at our homes. In recent years, “blockchain adoption” has been a trending phrase in the technology, and numerous projects have made blockchain adoption their business focus. True adoption, however, is not when you are making money on something, it is when people use it in their everyday activities, without even being aware of it.

To illustrate, a few decades ago, the internet was an invention of the military. Then, it was a tool of the government, then an essential utility of banks and corporations, then a privilege of the wealthy. Now, having access to a nigh-limitless internet connection wherever you are is almost a given in most of the world.

In short, the internet has started as an obscure technological gizmo, but now has become a part of our homes. “Home”, admittedly, can have a plethora of meanings, depending on whom you ask - be it a building, a land, a country, a field, or a building plot.

Nevertheless, the blockchain can now be used for handling the property ownership and administration - regardless if they are houses or places where they can grow.  As such, the blockchain has permeated the core of people’s lives. It’s become a part of our homes - it’s been adopted.

During the course of this adoption, much has already been established that uses the blockchain:

• Cryptocurrencies that banks use for an interbank transaction (DASH)
• A supply chain for tracking and proving the veracity of medical supplies and food (KIWI)
• An ability to send money to any country with an internet connection in a matter of minutes (BTC, EHT)
• An exchange that allows trading commodities into cryptocurrencies (MTLX)
• An operation system that allows combining other blockchains together (QNT)
• Tools for process automatization and orchestration (LTO)
• Securing user's and companies' identities and preventing fraudulent actions caused to private documents and security certificates (LTO)
• DEFI [1] projects that will be cooperating with blockchain oracle providers

Finally, the last chapter that will conclude the era of blockchain adoption, is a blockchain-powered system for land administration.

This open-source blockchain verification tool will streamline and secure the work with:

• Purchase agreements
• Contracts on ownership and inheritance
• Extracts from the real estate cadastre
• All possible documents from surveys to registrations that are required records required for assets and properties in municipalities around the world

The blockchain as a solution for land administration in Afghanistan

The following sections will describe the importance of proper land management, the blockchain’s importance for upholding data integrity, and the cooperation of companies that administer land rights and registry in Afghanistan. Finally, the article will focus on LTO, a Dutch company focused on providing a development toolkit for implementing the blockchain as a land administration solution in Afghanistan, under the guidance of the United Nations (UN).

In September 2019, as a part of its City for All program, the UN was looking into blockchain technology as a way to secure and manage land records in Afghanistan in a secure, automated, and transparent manner. The envisioned blockchain solution was to serve as a key tool in the delivery of these fundamental components.

In August 2019 , the GoLandRegistry (PDF - Page 71) solution has been proposed for Afghanistan, which would enable the Afghan Ministry of Urban Development and Land to maintain a register of authentic and immutable property records and to produce and issue occupancy certificates. The Afghanistan land registry solution is slated to be transferred to the Government in December 2020. It will be ready to handle an estimated 2.8 million land lots, which will be individually registered on the blockchain. Afterwards, every update to the occupancy certificate will be done via immutable transactions using LTO Network Live Contracts [2]. Property owners will be able to demonstrate the authenticity of their land ownership documents independently through the Open Source blockchain verification tool.

Focus of action

• Effective land management with clear land rights, restrictions, and responsibilities
• Strategic urban planning to establish a common vision and guide public investments for an inclusive and prosperous urban future
• Improved municipal finance and governance, citizen engagement and representation

Why is Blockchain a good solution?

Traditionally, electronic security focuses on authorization, authentication, and access control. These mechanics are intended to keep unauthorized users from accessing or modifying data. However, when it comes to authorized access, either on the application or system level, it does not provide any protection. Blockchain enables tamper resistance for data through distribution over many systems that are run and managed by independent parties. This is ensured by the architecture of the blockchain, where every piece of data has thousands of globally distributed copies. A potential attacker intent on breaching the certificate would have to compromise the majority of the data distribution at the same time. This is extremely hard, expensive, and with a well-designed blockchain almost impossible.

LTO Network as an integrator of blockchain into land administration

The GoLandRegistry blockchain solution for land administration in Afghanistan can serve as a precedent for blockchain technology applied to serve for security, automation, and as a tool for reducing bureaucracy, and one that also meets the requirements of ISO/TC307 — BLOCKCHAIN AND DISTRIBUTED LEDGER TECHNOLOGIES, and is compliant with GDPR directives. 

The UN approached LTO Network with a request for cooperation on a system to provide a land registration system to everybody in Afghanistan who requires one - and later potentially in other countries as well. This first issuance is basically done by a system specially built to track the issuance and parameters of lands, such as value, ownership, area size, transaction history, and so on. These land parameters are registered and verifiable on LTO Network. 

Every subsequent transfer and specific interaction with this piece of land is registered in a Live contract. This contract is represented by a side-chain between two or multiple parties that can securely exchange information, and is available for parties that are involved on this particular side chain. However, the information in the contract is not publicly exposed to others. That way, the names and personal data like registration numbers and bank accounts are kept private. 

In addition, LTO Network also uses a special layer of security, called Digital Identity (DID), to ensure that the person entering a blockchain transaction is who they claim they are.

In this manner, LTO Network will process over 5 million land issuance transactions through Afghan GoLandRegistry in the coming months.

The components of blockchain application in GoLandRegistry

Tasks automatization

A Live Contract is an agreement between organizations that contains both on-chain and off-chain instructions. Live Contracts enable cross-organizational workflows without the need of a central system or trusted party and consist of workflows and rules that govern these workflows.

Similar to a Smart Contract, a Live Contract provides a dynamic method for defining logic on the blockchain. However, the purpose of a Live Contract is not just to determine the state of a process, but to actively instruct humans and computers about the steps it contains. In other words, a Live Contract is a workflow, that is a sequence of related steps or processes that are necessary to complete a particular task. Such workflows will have rules, where a certain action triggers another action.  If the rules of the contract are not upheld, the workflow cannot progress, and the contract fails to verify.

Example:

Consider the workflow of a simple lease agreement approval, in which a document gets (1) drafted, (2) approved, and (3) signed. A process is the specific instance of this workflow, so, for example, the lease agreement between parties A and B, which was drafted by an employee of B, approved by the CEO of B, and signed by both parties. A workflow always contains certain logic: the rules mentioned before. Take for example the rule that signing can only come after approval, or that a rejection instead of approval would lead to a redraft of the agreement.

Tasks orchestration

The private layer is used for task orchestration and data exchange between the stakeholders involved in the transfer or issuance of a piece of land. Every process creates a new chain that’s shared peer-to-peer between the stakeholders. Executed steps are added to the chain as an event and subsequently shared.

Security

With the use of blockchain anchoring, it is possible for data to be hosted on-premise and managed by an IT department, but guarantee data integrity simultaneously. Anchoring is an act of storing hashes, providing a publicly verifiable timestamp and making data tamper-proof.

Each event of the private layer is anchored [1] on the LTO’s mainnet. In a distributed system, race conditions or foul play may result in stakeholders having different versions of the chain of events. Anchoring provides irrefutable proof of which event happened first, and thus can be used to resolve conflicts.

A practical example of GoLandRegistry in land administration

The official statements

Land tenure and land transactions impact investments, credit availability, poverty rates, land values, and agricultural productivity. These are all key elements of economic performance, development, and sustainability for any country. Land registries underpin how land is held, used, and transacted, and support the protection, transfer, and enforcement of land rights, as well as resolution of land disputes. Land rights that are protected by law and that can be transacted easily are critical to a well-functioning economy.

In September 2019, UNOICT and UN-Habitat signed a Memorandum of Understanding (MoU) to provide a framework of cooperation for the development of a digital land registry using emerging technology tools in support of the Government of Afghanistan’s City for All (CFA) program. The two UN entities later collaborated with the LTO Network to leverage blockchain technology to support the survey, registration and documentation of properties in Afghan municipalities.

United Nations

Victor Kisob, Deputy Executive Director, UN-Habitat: “Land is central to ending poverty and inequality, to enhance access to food security, to provide basic services, to foster peace and stability, and to reduce land degradation in rural and urban areas. UN-Habitat is supporting member states to build and strengthen systems to fast track progress towards SDGs 1, 5, and 11, and to generate data for monitoring progress, reporting, as well as for effective and evidence-based policy formulation and decision making. Efficient and accessible land registries are key to this process. The collaboration between UN-Habitat, UNOICT, and LTO will promote the use of modern technology and an integrated approach to data generated for this purpose”.

United Nation

Maurizio Gazzola, Chief Strategic Solutions, UN-OICT: “UNOICT has collaborated with UN-Habitat, the Government of Afghanistan and the LTO Network to build a software solution that can effectively support Afghanistan’s digitization of government administration services to improve the quality of life for its citizens. The plug-and-play design of the LTO Network’s blockchain and the contribution of transaction tokens for the Afghanistan project enabled the development of the blockchain anchoring mechanisms and the Open Source certificate of ownership verification tool that is now available to any country to utilize as a blockchain add-on to their existing land registry systems”.

LTO Network

Rick Schmitz, CEO, LTO Network: “We’re proud to facilitate land registry operations for countries around the world through the open-source boilerplate that we intensively developed for the past year in collaboration with UN-Habitat and UN-OICT teams. We believe the future for land registries lies with hybrid blockchain solutions that allow for optimized and decentralized data exchange between stakeholders in the land registry process without the need for expensive IT-overhauls, simply by linking APIs. By using Live Contracts, data can be automatically distributed to different stakeholders and systems to facilitate land-registry transfers, tax automation, provision of credit, etc, making them unprecedentedly efficient.

Conclusion

The ultimate goal of blockchain technology is not to make people rich, but to make things possible. In the case of the GoLandRegistry system in Afghanistan, what blockchain makes possible is land administration of high data integrity, resistant to fraud, and with less bureaucracy involved. If this works well, similar land administration systems could be implemented in other countries. As such, the GoLandRegstry can be the first step on a road to a world with more equality and better trust in the system. 

Regardless how potent a tool blockchain is, nevertheless, it requires a solid infrastructure if it is to be beneficial for its users. Because human input is still required for blockchain to function, this input therefore has to be sound. Thus, those who participate in a blockchain system should be consistently rewarded for using it in accordance with local laws and general human decency.

Accordingly, in GoLandRegstry, all parties involved have veto rights, which assumes that the data they provide is correct, and used in good faith. The workflows, digital contracts, and computers then keep it that way.

Now that the blockchain can secure people’s homes, I daresay that the much-talked-about “blockchain adoption” has come to its conclusion. I am more than happy that I could be there as it grew and evolved, from a digital coin, developed for transactions between friends, all the way to a resilient system that takes care of land rights.

The end.

About the parties involved

LTO Network

LTO Network is a member of the blockchain standards committee (as well as an ISO/ TC 307 contributor) and the International Association for Trusted Blockchain Applications (INATBA). LTO Network develops and provides a Toolkit for Trustless Workflows (as a product/service). It is a solution that automates workflows in the business-to-business (B2B) market by making them trustworthy between each party. To execute this, they split up their solution into a Hybrid Chain with two different layers. The second layer uses permissionless private chains, which utilize LTO “Live Contracts”. The “Live Contract” is like a workflow to automate processes (for example, a customer who applies within a KYC, which is getting signed by the company). The information about this event happening gets hashed (saved within the cryptographic algorithm) on the first layer, which acts then as the security layer. All of this is possible by connecting legacy systems that the parties already use. LTO Uses hybrid blockchain and Live Contracts to help organizations break out of data silos.

United Nation

Office of Information and Communications Technology (UN - OICT)

The Office of Information and Communications Technology is responsible for defining strategic direction for ICT to the Secretariat. It provides oversight of ICT programmes, budgets and decision-making to ensure alignment with the Secretariat’s overall ICT strategy. The team consists of more than ­­300 people operating global data centers and coordinating services provided by more than 4,000 people in UN offices worldwide. The Office is headquartered in New York and sits within the Department of Management.

United Nations Human Settlements Programme (UN-Habitat)

The United Nations Human Settlements Programme (UN-Habitat) is the United Nations program [1] for human settlements and sustainable urban development. It was established in 1978 as an outcome of the first United Nations Conference on Human Settlements and Sustainable Urban Development (Habitat I) held in Vancouver, Canada, in 1976. UN-Habitat maintains its headquarters at the United Nations Office at Nairobi, Kenya. It is mandated by the United Nations General Assembly to promote socially and environmentally sustainable towns and cities with the goal of providing adequate shelter for all. It is a member of the United Nations Development Group.[2] The mandate of UN-Habitat derives from the Habitat Agenda, adopted by the United Nations Conference on Human Settlements (Habitat II) in Istanbul, Turkey, in 1996. The twin goals of the Habitat Agenda are adequate shelter for all and the development of sustainable human settlements in an urbanizing world.

Additional resources

Anchoring transaction

DEMO: https://anchor-demo.lto.network/demo/ 

Live Contract

DEMO: https://playground.lto.network/ 

UN - Tech plan

United Nations Activities on Artificial Intelligence (AI) 2020

Footnotes:

[1] Anchoring is writing a hash of an event from one chain to the other chain. That’s useful for timestamping and making data tamper-proof, but it also allows the parties to reach consensus on the private event chain.

[2] Live Contract is a workflow with instructions and rules for reaching of an effect of automation.

[3] DeFi is short for “decentralized finance,” an umbrella term for a variety of financial applications in cryptocurrency or blockchain geared toward disrupting financial intermediaries.