Landcoin: A Practical Protocol for Transfer-of-Asset

Abstract

Blockchains ensure integrity, transparency, and immutability of transactions they process. It also guarantees the eventual inclusion of all the transactions submitted to the blockchain and records them in its ledger. Bitcoin and Litecoin are examples of time-tested, reliable public blockchains that handle only one type of transaction – send/receive money (i.e., transfer-of-value) from one user to another. Whereas, general-purpose blockchains like Ethereum provide means and methods to encapsulate transfer of not only value but anything fungible that can be digitally represented with the help of programs aka smart contracts. However, with a high-level Turing-complete programming language to write smart contracts, Ethereum encountered vulnerabilities in its contracts thus forgoing the claim of immutability. On the contrary, script-based blockchains like Bitcoin and Litecoin have withstood the test of time and hence are perceived reliable – a very important aspect while managing assets like land. In this paper, we present a transfer-of-asset system for land management that borrows from Litecoin protocol its script, underlying consensus, and block structure. Our resultant system is a permissioned blockchain, where only a set of pre-approved miners can append land records to the blockchain. We introduce sidechains that are roped in a mainchain. The mainchain stores land records, which can be queried by citizens; whereas, sidechains hold intricate details about intermediate validations performed by regulators, registrars, and notaries. The process of land management used in this paper is a typical process in the states of India. Our system can be used to manage any asset class that is finite in nature. Our approach provides transparency of transactions at a higher level and privacy to individual transactions.

The work was done at the Center of Excellence for Blockchain Research, funded by Ripple UBRI.