Transforming Auto Industry Using Blockchain

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About: CapturLAW

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About Author

Sourav Suman Sourav Suman is a law student at UILS, Chandigarh University, Mohali. Blockchain, Financial Markets, Technology, and Business are among his areas of interest. A strong advocate for a world in which everything is decentralised.

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IntroductionAs more manufacturers consider the industry’s future, there are still far too many unresolved issues. For one thing, corporations continue to focus just on their vehicles, rather than the environment in which they operate. Nonetheless, the development of blockchain as a feasible means of smoothly storing and communicating data is a hopeful addition to the equation.

Creating settings that encourage two-way communication between automobiles and their supporting infrastructure is a critical component of successful autonomous vehicle deployment. While the Internet of Things (IoT) and smart cities have helped, blockchain technology provides a substantial improvement that has the potential to change the future of driving.

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Connecting Automobiles and Cities One of the most significant hurdles to autonomous vehicles hitting the mainstream is that they are still not sufficiently linked to their surroundings. While automobiles are capable of processing millions of data points per second, they must do it in iso-lation and without context.

The use of IoT devices substantially increases this functionality since they can gath-er and send critical contextual data to automobiles to improve their performance. This includes information on road conditions, traffic accidents, and other vehicles on the road that may have an impact on a vehicle’s ability to drive.

Nonetheless, IoT devices are constrained by the constraints imposed by existing technology. Data becomes insecure as it is centralised, and the inability to transfer data quickly between locations decreases its value in real-time circumstances. How-ever, blockchain technology has the potential to substantially improve the current quo.

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Benefits of Blockchain The capacity to distribute data more efficiently and quickly is one of the many ad-vantages that blockchain brings to the table. Driverless automobiles must be con-tinually aware of three important factors: road conditions, their own condition, and the state of other vehicles. Because of its communication methods, traditional IoT complicates this procedure.

The decentralised ledger of blockchain implies that each node in the network—in this example, each automobile and data point—has access to all data nearly simul-taneously and more precisely. Companies are already attempting to enhance overall connection by incorporating improved vehicle monitoring and communication. The first step in building a secure autonomous environment is to develop decen-tralised networks that more easily convey data to all places.

Microservices on the Block-chain: What Are the Benefits? This is my personal favourite use case. Another growing application of blockchain technology in autonomous cars is to improve transactions that occur regularly between vehicles as well as between vehicles and the infrastructure surrounding them. It may not appear to be important, but it has the potential to minimise friction at several places, increase communication, and eliminate traffic bottle-necks.

Vehicle-to-vehicle (V2V) microtransactions are one significant area where this will most likely be used. In this approach, car owners may pay for data from other cars using tokens such as Streamr’s DATA token. This might contain weather predic-tions, local gas prices, traffic data, and other information. Vehicles may potentially earn tokens by just giving their data or selling it to advertising or manufacturers. With this technique, blockchain establishes a V2V closed environment that simul-taneously incentivizes and rewards participation.

In terms of vehicle-to-infrastructure (V2I), blockchain provides automobiles with a considerably simplified payment environment meant to ease many elements of driving. Instead of paying for many things manually— things like car maintenance, tolls, insurance, and so on—blockchain may enable automatic payments using smart contracts.

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Smart Contracts: What can be the use case in the automotive industry?

Usage-based insurance is a prime example of a feature that smart contracts could improve (UBI). Drivers might automate their insurance to be paid based on usage rather than paying yearly insurance rates that can change due to unknown vari-ables.

These UBI systems need a considerable amount of data input to provide correct estimates and premiums to drivers. Insurers, on the other hand, might immediate-ly compute a driver’s premium and simply execute pre-existing smart contracts to automate payments by tapping into public blockchains.

Another intriguing use of blockchain-based microservices for automobiles is ride-sharing. The industry is presently dominated by ride-hailing apps such as Uber and Lyft, although there is rising competition from popular ride-sharing services such as Google’s Waze, which prioritises carpooling over taxis.

The Toyota Research Institute (TRI) has already made considerable progress in terms of researching and preparing for the integration of blockchain into the auto-mobile industry. TRI collaborates with various businesses to develop solutions that use blockchain to improve ride-sharing, perhaps incorporating car sharing for seats and empty trunk space. Toyota acquired “Level 5,” Lyft’s self-driving research divi-sion, in April 2021.

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Conclusion:

Blockchain has been exercising its disruptive muscles in a variety of industries, but the automobile sector has enormous promise. By altering minor parts of the driving experience and increasing driver safety on the road, the technology has the poten-tial to be a game-changer in the transition to a more autonomous driving experi-ence. Consumers will soon experience the transportation change fueled by distrib-uted ledger technology as more automakers and infrastructure companies explore new ways to incorporate blockchain (DLT).

Sources:

1. https://www.investopedia.com/news/6-companies-using-block-chain-change-travel-0/

2. https://www.investopedia.com/articles/investing/090215/unintended-conse-quences-selfdriving-cars.asp

3. https://www.investopedia.com/tech/which-industries-will-blockchain-dis-rupt-next/

4. https://www.investopedia.com/articles/personal-finance/111015/story-uber.asp

5. https://www.investopedia.com/news/what-0x/ 6. https://www.investopedia.com/articles/personal-finance/010715/key-differ-

ences-between-uber-and-lyft.asp

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