How Blockchain Is Taking Over Automotive Industry
Over the last decade, the automotive industry changed a lot, starting from its new focus on electric cars to autonomous vehicles. Blockchain is a next-gen technology that is bound to contribute to the automotive industry development, too.
Enhancing Security
Challenges of Autonomous Driving
Do you know that Tesla cars were hacked twice by the same Chinese team of researchers? In 2016, the hackers took over the remote control of a car’s computer system including the car’s brakes. In 2017, when the previous year’s error has already been corrected, the same team successfully reproduced a similar control takeover through another gap. Elon Musk got anxious about the cars’ safeguard: “I think one of the biggest concerns for autonomous vehicles is somebody achieving a fleet-wide hack.”
How Blockchain Can Help
Blockchain with its inherent decentralization could prevent cars from being hacked. As each chain’s node contains all the information recorded to the blockchain, hackers would have to hit all the nodes simultaneously to hack the system. In addition, the chain’s members verify all the transactions themselves, which guarantees the protection of the car ownership rights.
In Practice
Since 2017, the Toyota Research Institute started looking into blockchain and its application as a public ledger for autonomous driving. Apart from protecting the ownership rights, the Institute targets secure car-sharing and ride-sharing transactions. In addition, Toyota’s blockchain is aimed to store all the vehicles’ details to be used for defining insurance rates. Today, this research was partially adopted by Oaken Innovations.
Smart Car-sharing
Briefly about Car-sharing
The demand for car-sharing demonstrates an impressive growth. By 2025, the global number of car-sharing users is going to surge by 400% and reach roughly 35 million, compared to 7 million in 2015.
Currently, car-sharing is working in the following way. Once you decide you need a car, you contact a car-sharing company. For this, you need to be of a certain minimum age and have a valid driving license. If you satisfy the requirements, the company informs you about the nearest cars available. You can then open your car with the membership card issued by the sharing company. The service payment will include insurance, gas, and service fees.
How Blockchain Can Help
Mainly, with its secure smart contracts. They can be used to validate a driver’s identity, age, license, and current location. Once the smart contract confirms that all the requirements are satisfied, it automatically sends possible car options to the customer.
After the car is chosen, the blockchain-powered system will provide the customer with the membership card and lock some money on their credit card. The system will be tracking all the transactions and violations, if any. Based on the stored data, it will automatically estimate the customer’s insurance rate and adjust the amount of the locked money in real time.
In Practice
There are already two companies using blockchain for car-sharing services, Oaken Innovations and Tesloop.
Oaken Innovations developed a toll road system that monitors car location in real time and charges a toll when applicable. If the car is shared, the system automatically distributes all the necessary data between the vehicle owner, the car driver, the insurance provider, the toll road authority, and the road tax entity. It also guarantees instant payments.
Offering intercity transportation, Tesloop has adopted blockchain for its marketplace for car owners. It guarantees transparency of each vehicle’s history. Since cars are shared, it’s important for drivers to be sure of the right tire pressure, for insurance companies — of the top speed registered, for the technical crew — of the operating conditions. In these cases, the blockchain’s distributed public ledger guarantees transparency and immutability of the data.
Other Blockchain Applications
Apart from the benefits of enhancing security and making car-sharing transparent, blockchain can improve other aspects of the automotive industry.
For instance, blockchain can improve traceability of both a car itself and its components. This includes car history and spare parts provenance. Renault and carVertical have already announced their blockchain solutions for this.
Other reasons to adopt blockchain include preventing the odometer fraud, improving loyalty programs, managing the movement of spare parts, and automating insurance contracts.
To date, there are still a lot of undiscovered realms within the automotive industry where blockchain can be applied. This is a great opportunity for teams developing blockchain-based solutions. To aid in the developing process, there’s already a lineup of ready-made blockchain environments, such as genEOS.
Blockchain Opens New Opportunities for Automotive Industry
Due to the high level of security provided by blockchain, autonomous driving can become safer. Blockchain’s inherent decentralization can safeguard internal car systems from hacking and protect ownership rights.
What’s more, a built-in public ledger allows storing all the car history and providing the real-time car status instantly on request. This feature is going to upend car-sharing services. In addition, blockchain makes the provenance of cars and their parts transparent, which is extremely important for proper maintenance and establishing sellers’ trust.
