How smart contracts work with real assets and a national currency

xuxu

I'm trying to figure out how smart contracts work with real assets and a national currency. If I have land, say, and the person buying the land doesn't have ether, if they transfer USD into a third party account directed at my account, could the third party activate the transfer in the contract?

Is there a better way of doing this given the same scenario where the other person doesn't have ether while I have land for sale and a smart contract floating around.

Are there similar examples available for study?

seeriktus

As far as I understand, ethereum can initiate transfers as far as technology will allow. Say if you have an account to receive payment electronically. But if it's a physical asset, then at some point there's going to need to be someone in the physical world to carry it out, lets say a solicitor or estate agent. Since that agent is still going to be receiving payment it is in their interest to recognise it, though there would need to be a slight shift in business practice.

Take for example gold trading on FOREX. People dont literally receive pieces of gold every time they make a trade, though they are legally entitled to, it would be very slow. They may not even be interested in obtaining a piece of gold, but just making a profit from trading. So what they do is just trade in the 'rights' to the gold. This is called the 'disembodied' asset, as opposed to the 'embodied' asset which is the gold itself.
In actual fact, the gold traded on FOREX represents just a fixed amount that sits in a vault somewhere.

seeriktus

Contact with the world external to ethereum is performed using data feeds, so I hear:
https://www.reddit.com/r/ethereum/comments/1x3c4d/how_does_ethereums_data_feeds_work/
http://forum.ethereum.org/index.php?p=/discussion/31/what-would-a-trusted-data-feed-look-like
Otherwise it would be pretty useless financially in my opinion.