Cryptocurrency and the automotive industry-What you should know
Cryptocurrencies-Making waves
The investment world is gradually being taken over by the digital economy, and no one is new to the term ‘cryptocurrencies’ or the benefits these have to offer. These digital currencies have set up a commercial platform for all sorts of transactions to take place safely and securely through an online cashier system. Cryptocurrencies, according to an article by Lee D.K.C, are a subset of the digital currencies but are highly unique in their existence because of the mechanism they use which is blockchain technology. These digital currencies, also known as alt-currencies are nowadays pretty helpful in making different investment decisions.
One common financial investment that any blockchain geek would know about is an ICO or an Initial Coin Offering. Just like a physically existing company sells its shares publicly to investors in an IPO or an Initial Public Offering, organizations offering an ICO to potential investors seek some investment in the form of coins also referred to as digital tokens which are later used in the development of a new digital currency or software, etc. This form of funding provides potential investors a chance to maximize their profits. Widely becoming known as crowd sales in the finance sector, these have the power to generate returns of around 12.8 times of the original value of the digital currency according to an article published by Investopedia.
While ICO is one example that is commonly being used in participation with digital currencies/tokens, there are many other forms of investment and funding using cryptocurrencies and the blockchain system which have benefitted organizations in the most eye-opening ways!
What exactly is Blockchain?
This is an online distributed ledger that works as a massive electronic database holding ample amounts of data stored in the form of blocks connected together to form a chain. As stated by Praveen Jayachandran in his research a cryptocurrency can follow either a public or a private blockchain system the only difference being that the former provides incentives for anyone to join the network whereas the latter requires an invitation by the party that created the network and displays a basic set of rules to exhibit consumer privacy. Bitcoin is one example of public blockchains. Blockchains follow a decentralized system of functioning. This means that any information stored on these blocks regarding a consumer’s private deals or offers, personal data is safe from unauthorized outside access such as by the SEC (Security Exchange Commission) or even the State bank. As a result, providing potential investors with privacy, security, and timely payments by issuing a unique hash code to all contributing parties which when they enter, only then will make the transaction complete. Once the transaction is complete, it is time stamped making it permanent and non-erasable. In this way one carries out a transaction online without any hassle, is safe from the risk of alterations and fabrications of data in the future minimizing the chances of fraudulent activities.
It is undoubtedly safe to say that cryptocurrencies and the blockchain systems have massively transformed or are beginning to revolutionize various sectors of the market. Any industry that inculcates the blockchain system into its working portfolio is automatically holding a competitive edge in the market. A distinct feature of the blockchain technology is exactly this; unlimited application. Many industries have begun using this system, but one industry that utilizes this technology to the best of its capabilities is the automotive industry. With seeping new advancements and ways in which this sector is extracting the benefits this technology has to offer, soon it will create a benchmark that is going to be very difficult for organizations to meet if they don’t follow suit.
A new chapter for the automotive industry
For any industry to flourish the basic rule of marketing encourages companies or the sellers to work with changing trends and failing to do so will make it a piece of cake for any competitor or even a newcomer to take over in full swing. Owing to such distinct attributes of cryptocurrencies, many industries are beginning to implement blockchain into their systems thus improving their outlook, values, and performances.
The automotive industry is one that displays its quick recognition of an opportunity. As the digital economy booms with cryptocurrencies, car dealers, insurance companies, leasing units and many more participants in the industry are working to integrate productivity and efficiency in their companies through these digital currencies. An organization, the AutoBlock, is working its way to excellence by modernizing the conventional approach of car dealings and vehicle valuation. It works with an online platform that deals in car selling and purchasing using an online transaction system that exchanges digital tokens in place of the traditional fiat money. This has not only improved on the efficiency of the exchange, but buyers are also benefitted as the process displays authentic and easily accessible information about spare car parts which cannot be copied or misplaced, prevents frauds and encourages timely closing of the transactions being carried out. This technology thus allows buyers to access relevant information about cars and engage in dealings irrespective of their locations.
Fair car valuation is extremely important and other than the Autoblock; Car Vertical is an organization that was able to earn approximately fifteen thousand dollars in Etherium ICO funds for providing a transparent and visible system of car valuation. Mostly it’s the insurance companies that have inside information on any mishaps or tampering a car has been through but buyers cannot get around that data without paying an extra hefty amount. Car verticals project was designed to provide owners with information about a particular car without any additional fee or charges.
The AutoBlock does not stop here, in fact, it has upped its’ game by also developing its very own cryptocurrency, the AutoCoin, that works specifically for such transactions. Any exchange that takes place through the platform provided will convert incoming digital currencies into the AutoCoin. According to FinTech, it is one of the first cryptocurrencies to be launched that uses a hybrid blockchain model to revolutionize the car valuation system. This currency dedicated to motor trade protects users against the risk of massive frauds by preventing any chargebacks or counterfeits through the use of smart contracts. According to the medium corporation, smart contracts are computerized programs that exhibit automatic execution based on predefined terms and agreements without the need for any financial intermediary.
Also, it also maintains anonymity as it does not require the dealers to present personal information on the platform. Another unique advantage that the AutoCoin has to offer is that it allows users to retain digital tokens and exchange them into euro bills or traditional money when such a need comes up. This revolutionary transformation of the automotive industry brought forward the CEO of We Buy Cars Today (Webuycarstoday.co.uk), Thomas Delgado to be one of the pioneers in offering the AutoCoin as a solution to aid in more secure transactions thus opening opportunities to indulge in new ventures within the industry.
While the AutoBlock has definitely made its mark within the industry alongside the tech world, there are many more established names in the industry pushing into cryptocurrencies and the blockchain system grabbing this opportunity as they move forward. According to Techcrunch, Toyota has partnered with the MIT media lab to carry out an in-depth research of cryptocurrencies and the blockchain system to create a software that makes driving technology more efficient.
Many other existing automotive giants in the industry are at a neck to neck competition in integrating blockchains and cryptocurrencies into their systems to change the landscape of their dealings. Daimler AG, a German car manufacturing company, is exploring the world of blockchain technology to come up with their own digitized motor trade currency called the MobiCoin whose purpose would be to reward drivers who have eco-friendly driving habits. Daimlers’ currency basically provides incentives to such drivers whose rewards will be collected on a mobile application and these rewards can later be warded off against events like Mercedes Cup finals or any fashion show as stated by Brian Smith in his article.
With all such technological advancements taking place in the automotive industry, it has opened up new doors for the development of autonomous cars. The German luxury motor brand, Porsche, advertised that it is the first car manufacturer brand to integrate and successfully test blockchain technology in a car according to coin insider. The company paired up with Xain, an organization that provides ideas and solutions related to blockchain intelligence and claims that using blockchain features also enables them to speed up the car locking and unlocking system by six times its original speed. Along with this, when any individual locks or unlocks the car, data such as location and time are automatically logged on to the blockchain system providing the owner with the facility of knowing who had access to the car at a given point in time.
Other than famous conglomerates cleverly taking over the blockchain world, there are numerous ways through which the blockchain technology is improving the efficiency of this industry. A German company Innogy SE has come out with a spectacular out of the box idea to revamp how spare parts can be sold. Just like conventional vehicle valuation can be refined; this company has developed the digital twin technology. This project creates a digital clone of the concerned product and ensures that any spare parts that are sold have a distinct code or a name that becomes their source of identification. Through this technology, a company cannot have double codes for different products and the purchaser gets access to all sorts of data such as the product life, any accidental history, etc. In this way, car dealers and purchasers are saved from the hassles of frauds or scams that were pretty common in the traditional setting.
While all these established companies are individually surfacing to the top of their game, some of them are also teaming up to play smart. BMW, General Motors, Ford & Renault have formed a strategic alliance with one another within the automotive industry. A strategic alliance is a form of smart marketing that combines the power and capacity of majorly strong players in the market such that both or more of them are able to benefit from it and their chances of reaping more rewards are doubled. As stated by Ashley Lannquist in her blog at IBM, they have developed a group called the Mobility Open Blockchain Initiative (MOBI) consisting of members such as manufacturers, service providers like IBM and Accenture and conglomerates whose sole focus is on the implementation of the blockchain systems such as Hyperledger and Concensys. This unified model seeks to allow data sharing and vehicle to vehicle payments creating a new mobility system thus making a distinct mark in the digital economy. This system would offer various services such as ridesharing, self-driving vehicles, eco-friendly vehicles, etc.
When you come to the success and clever use of skills of participants in the automobile sector, the list simply does not seem to end. Many globally established powerful conglomerates have embraced the blockchain revolution and are planning to make millions out of this life-altering development. Companies like Tesla, Nissan or Volvo, are working in collaboration to familiarize the world with the concept of autonomous and self-driven cars by bringing them out on the roads. A distinct and eye-catching feature of these autonomous cars is that they will be able to intercommunicate with one another using IoT (Internet of Things) which also uses the blockchain technology. Thus facilitating consumers with the options of sharing a ride automatically, using a pick and drop service or getting multiple modes of transport.
This isn’t the end
As discussed, the technical world is an ever growing industry, and the four-wheeler world is asking to bring on the challenge. The automotive industry has largely benefitted from the power of cryptocurrencies and the mechanisms they employ that it is hard to say the game has ended here. In fact, we have yet to see more innovation in both the industries and the power they unleash as they become united. Some car manufacturers and insurance companies are using these digital currencies to measure up to the safety standards expected by clients and are doing a pretty applause-worthy job!
Author Bio:
About Michelle Joe: Michelle Joe is a blogger by choice. She loves to discover the world around her.
She likes to share her discoveries, experiences, and express herself through her blogs. You can find her
on twitter: @michellejoe524
Originally published at www.atebits.com.
