Blockchain is essentially an immutable, distributed public ledger where transactions or other data can be stored. Each entry or "block" is connected to previous entries using cryptography, linking all of the blocks together in an immutable chain.
For the connected car industry, this means that data can be appended to the blockchain to give vehicles a decentralized digital identity. This will transform the way connected cars communicate with other Internet of Things (IoT) devices. And with it comes new and improved capabilities for insurance, vehicle history, ride sharing services and more.
Blockchain technology has the potential to not only expedite our path to automated vehicles, but it also opens the door for multiple connected car use cases today. Let's take a look at a few examples.Enabling smart contracts
One of the biggest benefits of blockchain is that the technology enables smart contracts. Smart contracts are essentially programmatic code that can be executed on the blockchain. They can allow for the exchange of money, goods or services in a conflict-free way without the use of a middleman.
This is huge for OEMs, telecom providers and insurance companies. A consumer could digitally purchase a connected car and drive off the lot in a matter of minutes. An oil change could be purchased by the vehicle and operationalized almost instantly. And insurance and toll payments could be made seamlessly and instantly by the vehicle.Supporting V2X and V2I capabilities, and automated driving As we begin to realize the potential of vehicle-to-vehicle (V2X) and vehicle-to-infrastructure (V2I) technologies -- the capabilities that allows cars to talk to each other and objects around them -- blockchain could be a key enabler.
With blockchain technology, OEMs could benefit from quicker, more secure data transfers than are possible today. Every transmission would be traceable.
Ridesharing services could also benefit from more secure data transfer, location tracking and seamless payment between the passenger and the vehicle.
And as we look ahead to fully automated vehicles, information or currency could be exchanged between vehicles, infrastructure and other IoT devices via the blockchain.
Each of these use cases will benefit current connected car functionalities and will also allow fully automated vehicles to become even closer to a reality. With blockchain, a car could refuel, park and then pay for those services all on its own.Overcoming barriers to adoption Though blockchain is meant to provide an immutable public ledger, the technology itself still faces a few obstacles. Information privacy and device identity are still at risk as hackers can impersonate or have access to consumer data if a device's private keys are discovered.
Additionally, lack of general awareness and some industry skepticism will slow blockchain adoption.
If we can overcome these barriers, however, the realized benefits and use cases of blockchain will only continue to increase for IoT and connected car.
— Russell Vegh, Ph.D., is principal member of the technical staff at AT&T Internet of Things Solutions.