Spring Labs To Create Blockchain Registry For $5.6B Energy Loans Market
Spring Labs, a blockchain-centered startup has acquired a license to track the liens registry in the $5.6 billion energy-efficiency loan market using DLT, reported Bloomberg. The main goal of the startup would be streamlining the loaning process using the decentralized tech to cut frauds and increase overall efficiency.
As per the deal, four lenders under the Property Assessed Clean Energy Program or PACE would team up with Sprig Labs to provide their lien information to the startup without sharing any sensitive information. The startup is set to begin its operation in the first quarter of 2020.
Stephen Tic, the Chief Operating Officer of Ygrene Energy Fund California LLC, one of the four lenders who have participated in the program said,
“We are worried about a property owner, together with a contractor, having multiple liens on a property, It was something that we could all agree to and we don’t always agree, ”
PACE has been providing access to loans for upgrading or installation of renewable energy devices to businesses and homeowners since 2010. These loans are backed by collateralized by property taxes and since they sit above mortgage, it draws lower interest rates.
Adam Jiwan, Chief Operating Officer of Spring Labs was quite elated with the recently acquired deal for monitoring loans using DLT and said that their firm has integrated cryptography and privacy enabling the software to create a very efficient registry system. He said,
“This is an example of a blockchain solution in the financial-services industry that’s going into real production. Our solution provides anonymity and privacy assurances. The company combined elements of cryptography, blockchain and privacy-enabling technology to create the registry,”
PACE's move might be motivated by recent California Legalisation recommendations
PACE was recently recommended to improve its ability to identify issues related to its lien management by the California Legalization, amid growing cases of fraud.
Earlier the mortgages along with the lien were tracked by the nationwide Mortgage Electronic Registration Systems or MERS, but it is not considered immutable or authoritative. Jiwan believed that the lien registry can be morphed with mortgage registry over time, and thus the necessity for a decentralized database.
“The real intangible is creating more confidence in the industry as a whole,”
He believed a DLT would open the gates for a more secure registry system as it would not have to rely on a centralized database.