In The Mystery of Capital Hernando de Soto showed how legal property rights are the sine qua non for unleashing the economic potential of assets, for wealth creation. As it turns out, Honduras, one of the poorest countries in the world, is about to register property rights by using blockchain, part of the bitcoin technology. Blockchain’s transparent digital transfer public ledger system of ownership could bring the poorest people in Honduras out of poverty by both documenting their property rights and giving those rights the necessary characteristics to carry out different economic functions.

For this, it is crucial that the holders of informal property be brought into the system and that the information gathered on their properties for formalization truly capture their rights. This is an enormous challenge and we are looking forward to seeing how blockchain performs in helping to bring the poor of Honduras into a digital economy.

By By Gertrude Chavez-Dreyfuss | Reuters – Fri, May 15, 2015

NEW YORK (Reuters) - Honduras, one of the poorest countries in the Americas, has agreed to use a Texas-based company to build a permanent and secure land title record system using the underlying technology behind bitcoin, a company official said late Thursday.

Factom, a U.S. blockchain technology company based in Austin, Texas, will provide the service to the government of Honduras, the firm's president, Peter Kirby, said. The company is doing the project with Epigraph, a title software company that uses blockchain technology, also based in Austin.

Factom would not reveal the cost of the project. Honduras would become only the second government to use blockchain, which increases transparency in a transaction, to manage government data, after reports that the Isle of Man would test a government-run blockchain project.

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