Cryptocurrencies are quickly cementing their role as the next big thing in technology, becoming more common and emerging from their reputation as being used for illicit, black market transactions. The automotive industry is increasingly embracing this new technology, bringing what’s known as blockchain into industry lexicon.
What is Blockchain, Exactly?
Simply put, blockchain is a public digital ledger that allows information to be distributed but not copied and stored across multiple channels. Information can be stored securely without risk of hacking or theft. This new technology can, among other things, record financial transactions, decrease odometer fraud, monitor self-driving cars and weed out fraudulent auto parts.
How Blockchain is Changing the Auto Industry
The blockchain is an emerging technology and we don’t fully understand everything it can do. Blockchain has the potential to revolutionize the way we do things and act as a new internet of sorts. This recent development brings with it whole new ways of doing things. For the burgeoning automotive industry, where growth is happening faster than they can keep up, blockchain may be the answer.
Through blockchain, cars may develop the ability to communicate among themselves, using machine learning to better understand their surroundings. This could mean that cars could essentially predict traffic congestion, as well as finding ways to improve safety and reliability.
Our current internet and data systems constantly put our personal data in peril. Blockchain technology sets out to change that. If you’re trying to sell a vehicle, for example, blockchain could set up a contract that would have to be put through properly before it could take effect. Blockchain can also eliminate the problem of the odometer rollback. This would greatly reduce the risk of fraud, essentially preventing sellers from being scammed.
Blockchain could be instrumental in speeding up the entire insurance claims process while improving security at the same time. It could also make the creation of peer-to-peer policies possible. For those who are not eligible for traditional insurance policies, they can still share the risk, this time though, among their peers, making them self-insured.
Another possibility is usage-based insurance. Blockchain could measure this automatically, without relying on driver reporting.
Blockchain would make all OEM auto parts traceable, with their location housed in a single location. This would reduce the need to track down parts as well as cutting down on knockoff auto parts. Parts would be immediately authenticated, ensuring that they are genuine.
While these technologies are still a ways off from becoming widely adopted, the automotive industry is readily embracing these new ideas. The blockchain is set to revolutionize the way the auto industry does business, and it may just change the entire world.
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