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Creating a Peer-To-Peer Connected World of Cars with Blockchain and IoT Synergy

 

Leading automotive giant, Toyota recently announced the development of a slew of proof of concepts on IoT and blockchain synergy. Toyota has leveraged blockchain technologies such as smart contracts, Ethereum based distributed ledgers, and data from IoT sensors in these proof of concepts.

By doing research and creating PoCs, Toyota and other original equipment manufacturers have developed ecosystems in which end consumers and enterprises can perform a number of functions in a secure manner. These include,


•Management of peer-to-peer ride sharing and car sharing transactions

•Storage of information on vehicle usage, which can be used in usage-based insurance

•Sharing of driving data to map road and traffic conditions

In this blog post, we discuss peer-to-peer ride and car sharing.

A car ride or share transactions is a use case to monetize cars by selling or sharing rides, and cargo space. It also includes leasing out of vehicles on a peer-to-peer basis without a centralized authority, such as a vehicle aggregator or rental agency.

This can be done by leveraging the advances in blockchain and IoT, and these advances have the potential to disrupt established players and replace their central trust systems with a blockchain-based distributed ledger and de-centralized systems.

Here's how block chain and smart contracts can replace traditional payments and financial services infrastructure

Blockchain can be used to store GPS and vehicle identity. The GPS, vehicle identity and On-Board Diagnostics (OBD) data can be feed by smart sensors inside the vehicle. Infrastructure data on current roads conditions and traffic data can also be added to the blockchain record. This allows for a complete view of all vehicles and infrastructure, current construction and traffic conditions, and third-party apps which are built on top of this data.


Use case of a car ride system

The present way in which car ride system work is through a centralized trust-based system, wherein popular aggregators provide the central trust platform

  • Driver registers with the aggregators and end users connect with these aggregators by downloading their app
  • End users interact with the aggregators to book car rides
  • Aggregators direct the driver to the end user
  • At the end of the trip, a transaction occurs between the consumer and the aggregator
  • The aggregator takes a service fee for enabling this transaction and transfers the remaining to the driver

In this case, the aggregator is the source of trust. They validate the credentials of the driver, interface with government agencies for approvals, maintains the ride providing platform, and ensures legal compliance.  

In this trust-based centralized car riding scenario, the driver and app users trust the aggregator to ensure the sanctity of the transactions and the related ecosystem.



A new way of working: Blockchain, IoT, and Smart Contracts for peer-to-peer car sharing

In this system, Blockchain powers the ride-sharing facility by storing vehicle usage data collected via IoT sensors, data about drivers, and passengers. This data helps to validate the smart contract between two parties and manages the payment of services without the need for any financial intermediates like banks, thus saving on transaction fees.


A high-level overview of how the peer-to-peer car sharing app works

  • The car is IoT enabled and IoT sensors on the car collect data such as GPS/current Latitude Longitude co-ordinates, Electronics Control Unit (ECU) sensors data, On Board Diagnostics port data, etc.
  • The digital entity of the car is created. Car insurance records, driver records, car state inspection records are entered in the Blockchain
  • The end-user and driver enters into the smart contract for a ride. As a part of the smart contract, the following ride details are recorded, driver digital entity, end-user digital entity, insurance details and end-user and driver cryptocurrency wallets
  • Once the trip is over, the smart contract verifies the distance traveled based on car IoT sensors, calculate the cost, performs the cryptocurrency transactions from end-user to driver and stores the transaction in the block chain




Advantages of a peer-to-peer car sharing app


The advantages of such a system are that there is no need for either, centralized trust systems or an underlying bank / central authorities that verify the transactions. Blockchain allows for decentralized nodes to verify the transactions based on a combination of digital signatures, cryptographic hash functions and public distributed transaction ledgers.

Blockchain also allows for the creation of a digital identity of the participants and transactions which cannot be forged or changed.

Blockchain also creates an immutable smart contract into which the end user and cab driver enter. For the services rendered they exchange a universal currency, Bitcoins.

With Smart Contracts and Blockchain, no share of transaction goes to any third-party/centralized trust system, remittance is instantaneous without any financial middle entities.

In conclusion, I'd like to say that as Blockchain continues to develop as a technology, a peer-to-peer car sharing app will be just one of the many benefits it offers us, people like you and me, who may not be technology savvy, but just looking to access a service quickly and in a secure manner.


References:

https://arcade.city/

http://pressroom.toyota.com/releases/toyota+research+institute+explores+blockchain+technology.htm




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