The blockchain is a system for decentralised, fast and secure data transfer. It is one of the disruptive technologies that are causing many industries to look into how they do business. The automotive industry is no different as manufacturers and parts supplier are starting to develop systems based on the blockchain which may be appearing in cars or workshops in the near future.
Blockchain was developed in 2008 and was used as the basis for the first cryptocurrency (virtual/digital money) Bitcoin. There are now many types of cryptocurrency for different purposes, but they are all based on the blockchain. Blockchain works on what is known as a distributed ledger, which is a network of computers that all have a list of all of the data transactions on the system. When a new data transaction is added, it is called a block. This block is transmitted to all of the computers in the network to validate its claims. The block is then given a time stamp, and the information is linked to the previous block with a unique value of a fixed length called a hash value. Then the new block is added in sequence into the network, like a new link in a chain. This makes the blockchain very secure, as past blocks cannot be altered without it affecting all of the blocks. From a currency point of view, this means that you can’t copy and paste your virtual money and spend it twice because the system knows how much you have. However, the blockchain is not limited to currency, as it is now beginning used to secure and transmit other data.
Porsche is currently testing a blockchain application directly in its vehicles—making Porsche the first automobile manufacturer to implement blockchain in a car. Porsche is collaborating with a Berlin-based start-up called XAIN, and have developed an application based on the Ethereum blockchain app platform (which is one of the biggest blockchain networks after Bitcoin).
Transactions based on this technology are secure and can be processed far more quickly than anything that has come before. The applications tested include locking and unlocking the vehicle via an app, temporary access authorisations and a new business model based on encrypted data logging. This could be developed further, for example, to improve autonomous driving functions.
Moreover, the technology makes it possible to assign temporary access authorisations for the vehicle in a secure and efficient manner. A protected connection to vehicle data and functionalities can be established using blockchain. At the same time, it protects all communication between participants. Third-party providers can be integrated without the need for additional hardware, simply by using “smart contracts”.
This technology may sound like it is years away, and will not affect cars currently on the roads. However, Bosch has different ideas. To stop odometer fraud (e.g. winding back the odometer before selling the car), Bosch is developing an application that uses smart contracts or certificates to record the odometer readings of vehicles. The readings would then be recorded in a blockchain system via a phone app or scan tool. This will allow the vehicle’s mileage to be checked and verified, so if the numbers don’t match, you know that the car has been tampered with.
With the rise of the internet of things (IoT), which will be needed for autonomous cars to communicate (with each other and the infrastructure around them), blockchain systems could be the system to keep this vast amount of data safe and secure.
Soon enough we will also be able to verify a vehicle’s complete history from manufacture, sale, registration, service, repairs (including accident damage) and parts replacement.