Business Tie-up for Joint Development of Real Estate Leasing Agreement Platform

Sumitomo Corporation (Head Office: Chiyoda-ku, Tokyo; Representative, President and Chief Executive Officer: Masayuki Hyodo) and bitFlyer Blockchain, Inc. (Head Office: Minato-ku, Tokyo; Representative Director and CEO: Yuzo Kano; hereinafter, “bitFlyer Blockchain”), have formed a business tie-up to jointly develop a platform utilizing a blockchain (Note 1) with a smart contract function – miyabi (Note 2) – that, once housing leasing agreements have been concluded on electronic form, will enable the entire process from reservation of previewing properties to concluding agreements.

In Japan, residential leasing agreements currently require a considerable amount of labor in pursuing in-person communication among leasers, management companies, brokering companies and lessees, concluding agreements via FAX or postal delivery, etc. Against the societal backdrop of a declining labor force and recent workstyle reform, increasing operational efficiency has become an urgent issue for Japan’s real estate industry, and expectations of greater operational efficiency utilizing innovative technologies have been rising.

Sumitomo Corporation and bitFlyer Blockchain are seeking to reduce leasing periods and increase the efficiency of administrative operations while ensuring safety and security by carrying out some of the operations connected with residential leasing agreements on a blockchain platform. By developing applications for lessees and managers and concluding agreements on electronic form, lessees and other parties involved can check on the leasing process at all stages, from applying for properties to concluding agreements, in a timely fashion, thereby reducing the time and cost required for binding, mailing and signing agreements. The data tamper resistance and utility that characterize blockchains can also be leveraged to securely store agreements and increase the efficiency of administrative tasks pertaining to management. We are going to complete the development/testing of a prototype in the latter half of 2019, after that will launch the service to general users.

One future aim will be to incorporate technologies other than blockchain in constructing a scheme whereby a lessee can with a single smartphone search for a property, arrange appointments for viewings, sign an agreement, move into a property, pay various expenses, renew agreements and complete vacating procedures on a one-stop basis, allowing companies involved in the real estate industry to achieve greater operational efficiency. Another aim will be to horizontally extend knowledge on sales and non-housing agreements as well as residential leasing agreements, and thereby improve the convenience of services provided by other industry sectors closely tied to real estate agreements, namely guarantee and insurance companies.

(Note 1) Blockchain
A completely new style of database characterized by the distributed maintenance of data across geographically dispersed servers that protects recorded data from loss and that continues to work even if some of the servers are hacked, enabling failure-resistant, low-cost operation

(Note 2) miyabi
A blockchain independently developed by bitFlyer Blockchain that resolves issues pertaining to the finalization of transactions, processing speed, etc., while enjoying the advantages of data tamper resistance and transparency that are the strengths of blockchain. miyabi ensures finality and offers flexible customization while maintaining a high processing capacity of maximum 6000 tps.

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■Sumitomo Corporation’s  Material Issues
Sumitomo Corporation Group positions “Six Material Issues to Achieve Sustainable Growth with Society” as an important factor in developing business strategies and in the decision-making process for individual businesses. Going forward, we will pursue sustainable growth by resolving these issues through our business activities. This project especially contributes to “the Development of Local Communities and Industries”, “Establishing a Foundation for Comfortable and Enriching Lifestyles” and “Providing Diverse Accessibility”.

■ bitFlyer Blockchain business domains
・ BaaS (Blockchain as a Service) 
Provision of cloud-based services using blockchain
・ Blockchain Joint Business 
Production of joint business using blockchain
・ Blockchain Core R&D 
R&D centered on bitFlyer Blockchain’s proprietary “miyabi” blockchain
・ Non-Regulated Service 
Provision of services in non-regulated areas