How is the automotive industry embracing blockchain? Five key projects to follow

While blockchain technology has typically been adopted by internet start-ups seeking to disrupt centralized platforms, perhaps one of the most tangible sectors to get a grip on blockchain is that of the automotive industry.

In recent years, automotive manufacturers – and in one case, an alliance comprising several – have initiated new programs and partnered with existing companies to integrate blockchain technology in a variety of surprising ways.

Here, we’ll take a look at how five automotive giants are revving their engines – and how exactly they envision blockchain technology will hit the road in the near future.

Daimler’s MobiCoin

German car manufacturing conglomerate Daimler AG has proceeded to launch its own blockchain-based digital currency dubbed Mobicoin at Barcelona’s Mobile World Congress this year.

The project aims to reward drivers for eco-friendly driving habits, and kicked off in a new testing phase in which some 500 drivers were rewarded for eco-friendly driving practices with the new cryptocurrency

MobiCoin enables the transmission of telemetric details from vehicles to Daimler, wherein eco-friendly driving habits are analyzed and accordingly converted into the eponymous cryptocurrency. As such, MobiCoin rewards drivers who travel at low speeds and practice gentle cornering, braking, and acceleration.

Drivers will be able to find their MobiCoins in an exclusive mobile app, and will be able to leverage their totals with VIP tickets for events such as the MercedesCup Final or Fashion Week in Berlin.

It remains uncertain at this point as to whether Daimler will proceed to launch cross-currency conversions and enable eligible drivers to exchange their MobiCoins for either fiat currency or a different cryptocurrency.

BMW meets VeChain & DOVU

Earlier this year, German automotive giant BMW partnered with the newly-renamed VeChain Thor in a new bid to become an industry leader in supply chain management.

Further, BMW has announced that it is testing a platform using blockchain technology as a means to track the mileage in leased vehicles. The automotive company has partnered with one of the five startups that joined as a part of BMW Group UK’s Innovation Lab initiative in order to develop the project.

Blockchain startup DOVU, is now working alongside the automotive giant’s fleet manager, Alphabet, on a system which will create an incentive for those driving BMW’s leased cars to log mileage while using the automobile.

DOVU’s head of product, Alex Morris, explained that the system will be made in order for BMW to understand how much its vehicles are moving and how much this movement will impact them.

Morris further detailed that tokens-for-rewards might be more reliable than the current mileage tracking systems that are in place at the moment. The head of product hopes that the initiative will “become this kind of ubiquitous rewards system that can work across vehicles”.

Porsche and blockchain-based apps

German automotive brand Porsche has publicly announced that it has begun testing several blockchain-based apps in its vehicles.

Earlier this year, the luxury brand advertised that it was “the first automobile manufacturer to implement and successfully test Blockchain in a car.”

Porsche has further outlined that blockchain technology might be applied to improve the safety and capabilities of autonomous cars – potential applications for blockchain technology could range from temporary access authorization through to new data logging techniques.

The German marque further hinted that third-party providers might be able to introduce integrated software solutions that could be executed through a smart contracts platform.

Porsche has claimed that blockchain features could be leveraged to speed up the process of locking and opening a car through a mobile application by as much as six times, and remarked that it is experimenting with processes that could leverage a ‘direct offline connection’ to bypass diversion through a server.

Volkswagen and IOTA

IOTA and Volkswagen teamed up to show off a new proof-of-concept initiative at Cebit 2018, where a concept demonstrated the use of Tangle technology to deliver over-the-air software updates to connected vehicles. The bid comes as part of IOTA’s intent to drive an autonomous machine economy in which devices can communicate and transact with one another.

The demonstration aimed to depict how an over-the-air update would function through an immutable storage medium and audit trail, and would highlight how IOTA technology can be implemented into legacy software systems.

The demonstration was intended to highlight IOTA’s bid to present itself as an attractive option for auto-manufacturers seeking to deliver secure updates to their vehicles with transparency access to audit trails. Volkswagen and IOTA predict that by 2020, over 250 million connected vehicles will have taken to the road.

Beyond delivering software updates, Volkswagen has noted that IOTA includes the ability to assist in any product recalls as well as record statistical recordings. As an additional opportunity, both brands noted the potential use of IOTA’s Tangle technology in developing products such as usage-based insurance.

Ford’s car-to-car cryptocurrency

A new patent issued by Ford details a mechanism through which a blockchain could be used to foster a decentralized network for vehicle-to-vehicle co-operation in traffic.

The patent – which officially details a ‘Cooperatively Managed Merge and Pass (CMMP) system’, would see driving behavior “monitored, recorded, and evaluated in a collective manner by themselves and other participating vehicles.”

Principally, the proposal outlines a system wherein vehicles leveraging the system could use a distributed network to tailor and adapt to the driving preferences of human pilots, and accordingly could use such information to alleviate traffic congestion by enabling collectives of vehicles to coordinate their speeds.

The patent outlines that ‘CMMP tokens’ would be used to facilitate the transfer of messages between vehicles – describing that “CMMP tokens are used to validate and authorize a transaction in which, at consumer vehicles’ request, the merchant vehicles either occupy slower lanes of traffic themselves, or allow the consumer vehicle to merge into their own lane and pass as necessary.”

The system would leverage CMMP tokens on a credit basis – the patent outlines that “the time allotted to the request of the consumer vehicle is based on the number of CMMP tokens chosen by the consumer vehicle to be spent at that particular time. For example, a driver of a consumer vehicle which is running late for an appointment may request to pass any participating merchant vehicles for a duration of 10 minutes on a particular road or highway for 60 CMMP tokens, at a rate of 10 seconds preferential access per token.”

Bonus: The Mobility Open Blockchain Initiative

While each automotive giant might be readying their own foray into blockchain, BMW, Ford, General Motors, and Renault have teamed up with one another to foster an alliance within the automotive industry.

The group have founded the Mobility Open Blockchain Initiative (MOBI) which includes members such as manufacturers Bosch and ZF, leading service providers Accenture and IBM, and blockchain focused megacorps Consensys and Hyperledger.

The conglomeration aims to generate a common system and application programming interface in order to allow payments and data-sharing between cars. This would aid in propelling a new digital mobility system which would offer services ranging from ride-sharing to self-driving vehicles with innovations in between.