While the blockchain technology makes its way into different industries outside of the finance arena, one vertical that's ready to take it on is the automotive world.
With the combination of big data in the auto market set to reach $4 billion by 2020 and end-point authentication in the auto market to be valued at $1,042.5 million by 2022, blockchain technology use is prime for integration.
Each vehicle that has been rolled off the assembly line for the past decade has had some form of technology embedded into its core. Think of all the turn-by-turn GPS, bluetooth-enabled stereos or USB ports that have grown to become standard offerings. At this year's Consumer Electronics Show (CES), there were nine new technologies unveiled from Honda, BMW, Ford, Faraday Future, Nissan, Toyota, Fiat-Chrysler, Hyundai, and Mercedes-Benz.
Within the past year alone, we've seen the likes of Porsche and Toyota steer their way towards blockchain technology use. In addition to this, the blockchain technology market is also set to see some significant growth over the next few years. Research and Market's Blockchain Market - Global Forecast to 2021 predicts blockchain's Compound Annual Growth Rate (CAGR) will grow a whopping 61.5 percent within the next five years from $210.2 million t0day to $2,312.5 million. The main issues are how much of that blockchain pie will automotive own — and how will it be implemented.
As more big data is pulled from vehicles to either make them autonomous or to do over-the-air (OTA) updates, consumers' concerns naturally fall to that of privacy concerns and what vehicle manufacturers are doing with their information. The Washington Post's Steven Overly commented on this area earlier this year in an article about the 2017 automotive trends.
He said, "The arrival of big data in the automobile has reason to give consumers pause. For one, there are privacy and security concerns that require vigilance — car hacking has the potential to become a problem if automakers do not effectively safeguard against it. What's more, automakers already have plans to turn that data into revenue, though many agree that car data belongs to the customers and they should determine how it gets used."
Not too long ago, hackers showed a WIRED reporter how a vehicle could be hacked. As such, there's a need to secure the data and technology within cars of today and the future. At the moment, blockchain technology is being used in the automotive industry to help facilitate payments. While Toyota plans to use blockchain to increase efficiency and lower costs for transparency with consumers, AT&T filed for a patent to enable cryptocurrency car payments.
Earlier this year, the concept around blockchain wallets for the car was introduced via a new project dubbed Car eWallet which was formed together by German auto manufacturer ZF Friedrichshafen, the innogy Innovation Hub, and Swiss Bank UBS. While this is still in its testing phase, the hope for this project is that it allows the Car eWallet to be embedded in vehicles' electronic control units (ECUs), which are then connected to a private blockchain to allow for transactions between people. This would allow for the potential of seamless and secure toll or parking payments.
While there have been various talks of how blockchain would be beneficial to the automotive industry, there has been zero action on the part of manufacturers in implementing it for the purposes of enriching security measures. Automotive software company Movimento's CTO Mahbubul Alam contributed a piece to Connected Car News on how the technology could be ingrained in cars early on in the supply chain.
He said, "Blockchain technology can create a trust protocol that really can be trusted. Today's product ID can still serve as a basis for the supply chain while maintaining authenticity in a way that everyone can trust. How it works is that a unique token or ID is created for each part or action that is then communicated to the distributed secure database open to OEMs and their supply chain partners. Enterprise blockchains ensure that within the supply chain, everyone knows what parts were created, how many, who built them, as well as other key data."
If car manufacturers can work to build blockchain technology into their vehicles early on, it's likely that it may be the answer to both consumers and the industry's big data security concerns.
The article was first published in PYMNTS