Blockchain-powered cryptocurrencies appear to be breaking through into the real estate and construction industry mainstream here in 2018 (note Harbor’s recent $28M in funding, which we’ll get to here at AEC Labs, soon). And there seems to be no limit on the industry’s appetite for innovation in this sector.
To that end, Bisnow recently profiled a new hospitality industry application for blockchain tokenization called STEP, which stands for “Simple Travel Ecosystem Protocol.” Taking aim at online providers like Expedia and Kayak, the tool tries to “tokenize” the hotel experience by moving rooms and other items onto the blockchain.
The idea is for hotel owners and travelers to become the primary stakeholders in the travel ecosystem, cutting out Expedia, Priceline, Kayak, and others as the middlemen. Individual hotel rooms would become a currency, called STEPcoins, which would be traded by both owners and guests on a decentralized blockchain-powered ledger.
Coins would be created when a new room becomes available, or perhaps when a participant in the protocol offers other related services (day trips, spa treatments, etc.). Travelers who provide reviews for hotels and other services that are listed on the protocol would also receive STEPcoins that they could of course redeem for items that are listed on the protocol.
As Bisnow goes on to explain:
“Hotels can then set pricing, volume discounts and exchange restrictions all encoded on a public chain. Any user can select goods through a transparent shared-data layer. The major players are hotel owners and travelers, as well as “master travelers,” such as event planners, tour operators and travel club leaders, who are super-users of the system. Reviewing goods and verifying providers are simple ways to gain tokens. It improves the reputation scores of service providers and builds community within the system, offering validations, curation, governance and loyalty-based bounties to the users of the system.
Why should we care about this AEC Labs?
We think STEP and travelcoins are noteworthy to discuss here in the context of AEC applications for a few reasons.
First, there seems to be no limit to the types of industries that are trying to apply blockchain-powered cryptocurrencies through tokenization. Real estate may be an obvious jumping off point, but hospitality and other industries closely aligned with AEC – either as clients or with similar needs – could blaze an early adopter path that might suggest important applications for construction.
Indeed, as Bisnow also notes, diverse industries, including the financial sector (where 90% of banks are actively researching how they can best apply the technology) are looking hard at blockchain protocols, the market for which is expected to be worth a staggering $3T by 2024.
Second, if blockchain really is all about building community, the highly fragmented nature of construction could present an opportunity for savvy stakeholders to “tokenize” a broad range of items and obligations within the industry – from supply chains and equipment to BIM models and insurance.
Finally, Bisnow makes the point that millennials are increasingly comfortable with the idea of cryptocurrencies. Construction’s reputation is as an old and stodgy industry which, objectively, is facing major labor problems that will only worsen as infrastructure spending increases. Moving certain applications to the blockchain might be a way to encourage younger generations to pursue careers in the industry.
What do you think?