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TH E M R EP O RT | 7 SPONSORED CONTENT Looking for a Practical Way to Benefit from Blockchain? Try Factom SmartProvenance ™ for Mortgages By Jason Nadeau W hile people are often con- fused about what block- chain is and what it does, there's an interesting analogy that can help you un- derstand its power in relation to data and document management. In the art world, the concept of "provenance" has long been cited to show the true origin or source of a valued piece of art, as well as to help trace the artwork's history of ownership. Today, other in- dustries also rely on provenance, including science, patents, music rights, supply chain, printed books, and archeology. Why is provenance used in such a wide range of fields? The answer is that it helps verify an entity's originality and authentic- ity with solid proof. By tracing an item's provenance, one can determine how it was originally created, its history, sequences of ownership and custody, and stor- age locations, as well as the item's integrity. Verification & Preservation A ny industry that has tradi- tionally relied on saving a paper trail of critical documents understands the importance of being able to prove that a specific document is indeed the original, that it has not been forged, and that it has never been altered, regardless of ownership. In short, that paper trail was the prov- enance of business records. The mortgage industry, for example, requires a wide range of sensitive documentation through- out the process from customer to lender, including income and asset documentation from the consumer and appraisal, title, survey, and credit information from various third parties. The collection and management of these various types of mortgage documentation has traditionally been handled manually via actual pieces of paper (or images of paper) exchanged between parties, often causing confusion, security, and versioning issues. Imagine the improvements that could be leveraged across the entire mortgage ecosystem if there were a better, more reliable way to account for each document and data set's provenance, from start to finish, incorporating every re- lated component. An ideal system would provide "SmartProvenance" and allow the industry to: • Verify documents integrity and originality. Documents and data stored within private data centers and secured by private networks could be registered and verified for various third- party uses without exposing the actual documents and sensi- tive consumer data. • Preserve all digital records for potential future disputes. By establishing provenance through blockchain, lenders can preserve the data, files, and documents used in the decisioning and pro- cessing steps for the mortgage, providing perfected evidence for compliance and future audits. Beyond simply backing up your data in your data center, you are registering the provenance of the entire file. • Model existing workflows. Utilizing individual chains data embedded within the block- chain allows all the parties who interact from the consumer to lender to service provider to in- vestor and GSE to publish and access securely their documents and data, as well as verify data and documents with other partners. This unique model of developing individual data chains would mirror existing record-keeping models to en- sure that data could be accessed immediately from existing processes. • This, SmartProvenance™ is available today through a col- laborative blockchain solution— Factom's Harmony. Harmony creates a digital process that allows each party to not only retain their docu- ments, files, and data securely within their data centers, but also provides trusted transactions with full confidence in the integrity of the information being shared or accessed. Harmony takes your private data and documents from your files and makes them both verifiable and independently au- ditable, providing assurance to all involved parties that documents and data sets are unchanged, original, and verifiable. Paper-Level Proof— Without the Paper I n yesterday's world, paper was king. Paper stood alone as the "trump card." A piece of paper served as the ultimate evidence for business transactions. Even as new digital formats became avail- able, we still modeled the digital process around "documents" that were stored in formats that mod- eled paper (e.g., PDF, TIFF). Some of that bias toward paper over digital still lingers today, long past its usefulness in a world that now offers access to better, truly data-based solutions. If presented with data from a mobile app or a piece of paper, chances are pretty good a court would still likely side with paper-based evidence over electronic data, since the old way of thinking is that paper is immutable and can't be changed. We have yet to make the leap from paper or digitized paper to pure data. Until now. Through the use of SmartProvenance, you no longer need paper to be your proof—data becomes the rightful king. By making the switch to this technol- ogy, you can not only finally move away from a reliance on the piece of paper itself, but also from the very concept that paper is the best we can do to verify authenticity. Factom Harmony can help you make this leap, today. JASON NADEAU, EVP of Factom, leads the strategy for the mortgage industry, including revenue growth, strategic partnerships, and business development strategy. Nadeau comes to Factom from Corsair Associates where as Senior Director, he provided strategic consulting to mortgage technology companies. Before Corsair Associates, he served as Group President at Stewart Title and CEO of Stewart Lender Services. Nadeau also served as Founder, President, and CTO of RealEC Technologies (now a Black Knight company) where he and the RealEC leadership team developed the largest electronic partner network for the mortgage industry.