The Title App Litepaper

Making sense of a messy world

HOM DAO is the creator of the Title App, a platform that provides a secure and immutable record of an asset's title records, chain of title, and title transfer. This creates several benefits for individuals and business by reducing costs and time in transactions, and creating greater transparency throughout the global economy.

Note added January 2024: HOM DAO Voted in 2023 to make the Title App a separate software company that will be formally created in 2024 with proceeds from the HOM COIN launch. The "Title App" company will receive the license to all HOM DAO patents related to title inventions, and be responsible for commercializing those creations. In return, Title App (the company) will pay HOM DAO a royalty from any revenues it generates from these inventions. HOM DAO may choose to use those royalties to do as it's community chooses.

Abstract

Title is a legal description of the rights to an asset and legal ownership and is a critical part of our modern economy. Title is used to transfer all types of assets, including real estate, equities, cars, mineral rights, and even consumer collectibles like sneakers, artwork or your kid’s bicycle.

The problems that the Title App solves

Lack of accurate, clear and secure titles results in corruption, theft, and is a barrier to helping lift people out of poverty. At a basic level, if someone steals your bike, your bike has a serial number. If that number isn’t registered in a way that anyone can see that you are the owner, then it makes it hard to get your bike back from the thief. In the same way, if you are living in a house and think you own the property, but don’t have clear title to it, the house may legally not be yours, and you could be evicted. Not surprisingly, lack of clear title most adversely impacts marginalized communities and women.

Title App leverages distributed ledger technology to provide an open and immutable record of any asset’s title records (asset characteristics/identifiers), chain of title (history), and title transfer (sale of asset). This is as important for a home, as it is for a bicycle within the home.

To keep the content of the DTC up to date. Title App uses AI-based bots to constantly scan and monitor activities related to the DTCs. AI is used to both build up the DTC themselves and support the ongoing monitoring services provided by Title App to its customers.

Benefits of the Title App

1. Simplification of the title process: The Title App uses distributed ledger technology to simplify the title process and provide an open and immutable record of any asset's title records, chain of title, and title transfer. This makes it easier and more efficient to transfer title ownership, reducing time and costs associated with traditional title services.

2. Improved accuracy and security: The use of blockchain technology provides a secure and tamper-proof record of title, reducing the risk of corruption, theft, and other fraudulent activities. The use of AI to compile records ensures greater accuracy.

3. Increased transparency: The Title App provides greater transparency in the title process, making it easier to establish who the real property owner is and reducing the risk of disputes over property ownership.

4. Empowering marginalized communities: The Title App can empower marginalized communities that may have a legitimate legal claim to properties that have been stolen from them to perfect their claims.

5. Saves money and time: The Title App reduces the cost of title-related research and insurance, which can account for up to 1% of the total transaction revenue of a property sale, making it more affordable for individuals and organizations to transfer title ownership.

The Digital Title Certificate and Interplanetary Title Registry

The Title App product is based on a software that produces a non-fungible token (NFT) called a Digital Title Certificate (DTC). This DTC contains immutable and changeable information and lives on the blockchain. The DTC can be modified by the rules embedded in its smart contracts which are aligned with the legal framework of the country in which the property is located. The DTC platform has been developed on blockchains that are gasless, to mitigate gas fees and reduce carbon emissions.

DTCs are recorded on the Interplanetary Title Register (ITR), which is an open-source blockchain-based database of assets. Anyone can place an appropriately formatted DTC on the ITR. When DTCs are transferred from one party to another, that activity is tracked on the ITR.

Title App incorporates know your customer/anti money laundering (KYC/AML) and digital identity to ensure the provenance of the owner of the property and DTC and avoid illicit activities, ranging from money laundering, to taxation, to land theft.

The content integrated into the DTC is compiled using API systems from existing data service firms and web scraping from public records websites. The content is then compiled and managed by AI systems. AI bots are used to continually scan the DTC records against any activity that can been “seen” via the web. Activities identified by the AI bots are used to send alerts to DTC owners about activity related to their property. For example, the AI bot might flag a mechanics lien or UCC filing made against a property and recorded in a public database or public notice in a newspaper website. This triggers an alert system where the AI bot notifies the DTC owner of the activity with a recommended course of action.

Making the Title App easy to use is a function of its digital wallet. This provides an easy and secure method for users to access, modify, and transfer their DTCs. A digital wallet is the customer's account which can easily be accessed through the app to mint, trade, transfer DTCs and other digital assets.

How is title currently transferred?

In developed countries such as the United States, Canada, and Australia, title services are largely manual, redundant, and costly. In developing countries, such as Brazil and India, title is often absent, unclear, or recorded through unreliable means, making it difficult to establish who the real property owner is. In many cases, this means that the person with either the most political power, or resources, claims title to the property and pushes out the inhabitants.

Use Case: Real estate

Our first use case for Title App is real estate, which is also the most complex form of title transfer. Title App is scheduled to be deployed in developed countries (the State and Nation of Hawaii, which is located in the United States) and developing countries in the Asia Pacific region.

Why is there no fee for the title insurance and ALTA policy in this example? Once a property has been secured using the Title App (first time), ALTA policies should not be necessary (nor required). It may be that the lenders still require some level of insurance, but with an immutable record transfer and valid legal opinion regarding title, insurance seems increasingly suspect. Further, in the current system the entire title process is done again at every transaction, which is not needed if the record of title is immutable. Even if a lender requires an ALTA policy the savings in time and money for using the Title App are significant.

The Title App Revenue model

The Title App generates revenue from multiple services. The first is a title monitoring and proecttion servcie which is available on a subscription basis. Title App generates fees from property owners claiming their Digital Title Certificates. over time Title App will generate transaction fees when Digital Title Certificates are modified and/or transferred between owners as part of a real world real estate transaction (or stock trade, or car sale, or sneaker sale on eBay).

Additional revenues are also generated through govtech and B2B sales and consulting fees for countries or large enterprises that wish to leverage the Title App protocol to their advantage.

Web 3.0 for a world of non-crypto natives

Title App services are focused initially on property owners and users, nearly all of whom do not have a crypto wallet. So the onboarding process is to have the user set up an account and custodial wallet within the Title App ecosystem. Once the NFT is created in this ecosystem, it is hosted in the client’s custodial wallet. Should the client wish to transfer the NFT to their personal non-custodial wallet.

The use of gasless blockchain

Title App is chain agnostic. It is deployed on the Polygon (MATIC) chain, and is now being optimized for the Redlight gasless chain. Using a gasless chain reduces the carbon footprint of transactions to nearly zero and ensures stable pricing. This helps ensure a user experience, versus one in which surprise gas fees lurk around every transaction.

Roadmap for the Title App

• Version 1: Real Estate. The long-term goal is that the DTC becomes recognized as the key legal document in all real estate transactions and become a key element of GovTech

• Version 2: Automobiles. The long-term goal is the the DTC becomes recognized as the key legal document for transactions, insurance, and service for DMVs world wide

• Version 3: Securities, carbon credits, and contracts will transition to web 3.0 using DTCs

• Version 4: Release of a SAAS and open API that allows any e-commerce platform to easily mint DTCs for products it sells which can then be recorded on chain to make it more difficult to steal products (including package theft).

Security

The Title App is providing software as a service (SaaS) to buyers and sellers of real world assets. The focus of our security process is across the tech stack, with a key focus on the creation, minting and payment for Digital Title Certificates.

Blockchains as a technology through cryptography are extremely secure, but nothing is impervious.

A key not about gasless blockchains and Layer 2 blockchains: Proof of Stake, Proof of Work and Proof of Authority allows us to utilize its decentralized nature to not rely on a single entity, but rather spread the burden of “risk” between all of the validators. This makes it extremely difficult to affect the network via a targeted attack. For example, a malicious validator can be kicked off the network by other validators through the decentralized voting process in Proof of Authority.

The rationale behind defaulting to a hosted wallet for Title App customers is that most of the people who use Title App do not own any crypto and the existing environment is confusing and often results in users losing their tokens when they lose their passwords. A custodial environment ensures that the users don’t lose their DTCs and also creates a more user-friendly experience.

Conclusion

The Title App has the potential to revolutionize our current economic and governance models, making title transfer more accessible, efficient, and secure.

If you would like to learn more about the Title App, you can do so through our website or by minting a Digital Title Certificate for your own property at www.titleapp.net.

The Title App

Created by the HOM DAO community @ www.titleapp.net