While Bitcoin has been the most vocal proponent of using the blockchain to safeguard monetary transactions, its application is quickly spreading to other industries. In the future, the car industry may also become obsessed with the topic. So, how exactly could blockchain technology cause a sea change in the automotive software development services industry?

 

Blockchain: what is it?

The distributed ledger technology known as the blockchain enables data recording and transfer. The Bitcoin virtual currency currently uses this technique. In its more physical manifestation, the blockchain consists of a massive virtual register that aggregates all user activity. “Blocks” are created with each new activity. Following the listing of all current information, the latter will interact with the worldwide information network. Consequently, it is no longer possible to alter the recorded data. Every time something new happens, the blockchain algorithm checks the entire chain to ensure it’s secure and accurate. How about we compare this system to a financial service? That should help us grasp it better. There is a monetary exchange for every user action. One block, or partial bank statement, includes all these transactions that occur over a certain period (say, a month). The blockchain is essentially an individual’s whole transaction history stored in a series of interconnected blocks. 

In order to understand how this technology works, you should also be aware that algorithms and protocols alone, without any human involvement, control blockchain development services. Doing so prevents the very beginning of any attempt at data tampering or fraud. As a result, the blockchain enables the safe, transparent, and automated transmission and storage of data. Due to this, it is frequently touted as the data transmission technology of the future. It has numerous current applications, such as virtual currency, online betting services, and authentication services.

 

How could the blockchain revolutionize the automotive sector?

While the automotive industry has yet to adopt blockchain technology, it has the potential to transform the industry completely in the future. A revitalization of logistics management, improved stakeholder authentication, a weapon against fraud, and enhanced vehicle life cycle monitoring are four potential big benefits of its application.

 

1. A revamped approach to overseeing the supply chain for automobiles

Supply chain management is the primary area where automotive businesses may put blockchain technology to use. Principals do not necessarily have a bird’s-eye view of the full automotive supply chain. It is challenging to trace the life cycle of a car from A to Z due to the many subcontractors involved, the several factories that produce the parts, the routing to the points of sale, and the vehicle’s design and construction. Because of this, it is very difficult to track individual components and, eventually, the vehicles themselves. This becomes even more obvious when the manufacturer recalls defective models. An item’s whole life cycle can be monitored with the help of blockchain technology, which would guarantee compliance and traceability. This technology would not only make logistics management cheaper and more transparent, but it would also increase the efficiency of industrial output.

 

2. The drivers of the car can be more reliably identified

Another equally important use case for blockchain technology is providing accurate and verified authentication for vehicle actors. It gives everybody access to the background of a car vendor or buyer by cataloging all the data pertaining to a product and also to people. Thus, it will be feasible to guarantee the honesty of his counterpart while buying or selling a car, particularly between private parties. Using blockchain technology could improve our understanding of lease firms, repairers, insurance, and even buyers and sellers. Countless experts are involved in various stages of a vehicle’s lifespan.

 

3. New methods for lowering the incidence of fraud and forgeries

However, if the blockchain can identify the players in the automotive industry, it will enable, first and foremost, flawless identification of automobiles. All the information about a vehicle, including its production location, maintenance records, owners, accidents, and more, can be accessed with the help of this technology. It is impossible to mislead about the true nature of the vehicle because the information is unfalsifiable. The sale of pre-owned automobiles benefits greatly from this item. Multiple studies have shown that 20% of VOs sold inflated their mileage. A buyer can guarantee the accuracy of information with a digital maintenance notebook that is tamper-proof and uses blockchain technology. Another service that the French startup Atos hopes to make more accessible in the future is this one.

 

4. Improved tracking of vehicle life cycles

Thanks to the public nature of car histories, many stakeholders in the automobile industry stand to gain. Before a malfunction happens, automakers can use the blockchain to recall potentially faulty automobiles. This is because cars made on the same assembly line often have problems. Insurers could point clients in the direction of the policy that is most suited to their car and its lifespan.

 

Conclusion

All of these blockchain applications rely on the network rather than the technology itself. As the number of people who use and support Bitcoin continues to rise, its popularity and value as a store of value continue to rise as well. Hire a blockchain consultant from a reputable blockchain development company to implement your plan. When it comes to future autonomous driving cars, this is crucial for a number of reasons, including the automatic payment of parking fees or electricity bills at a charging station. Still, external hacker assaults are less likely to succeed when using a blockchain. It will be difficult for attackers to access data, including account balances if it is dispersed over multiple computers rather than kept in a centralized location.