Autonomous vehicles and their benefits. Can Blockchain be utilized to engender more benefits?
About Autonomous Vehicles
Autonomous vehicles (AV) refer to the vehicles which can guide itself to move from one place to another with little or no human input e.g. autonomous cars, drones, etc.
Benefits of AV
Road Safety: According to the NHTSA study of 2017, “94 percent of serious crashes are due to dangerous choices or errors people make behind the wheel” i.e. due to human error. There might be numerous reasons behind it e.g. drunk driving, speeding, fatigue, age, etc. A self-driving car precludes any such possibilities as it is pre-programmed by the software to abide by the traffic rules. A self-driving car won’t be inebriated, won’t suffer from fatigue, and will drive in the limits prescribed by the traffic department, thereby sharply reducing the probability of accidents on the road.
Efficient Fuel Consumption: Automated eco-driving can considerably bring down fuel consumption. Human drivers tend to accelerate or decelerate aggressively, resulting in higher energy wastage. Casual behavior like leaving the engine on during long traffic stops adds to fuel wastage. An automated car can switch off engines during the red light, switch it back on moments before the light turns green. A recent study at the University of Michigan pointed out that “eco-driving practices that typically reduce fuel consumption, is predicted to reduce energy consumption by up to 25%.”
Increased Lane Capacity: By employing strategies such as platooning to a fleet of AVs, fuel savings and lane capacity can be increased. According to a report by KPMG “Platooning of vehicles into organized groups could increase highway lane capacity by up to 500 percent.”
Just to give you an idea of how effective platooning is in fuel savings, I am attaching a video link below.
Transportation Accessibility: Self-driving cars can be a big boon for elderly and differently-abled persons. Self-driving cars could free the elderly from the need to put their hands on the steering wheel. This would bring them tremendous convenience when it comes to visiting doctors, family/friends in different parts of the city.
Reduced Congestion: The two main causes of traffic congestion are the driving pattern of humans and accidents on the road. AV technology is programmable, therefore we can expect the developers will come with efficient driving models (which can be improved further). The accidents as discussed above can be greatly reduced (~90%) with the AV technology.
Passive Income: Recently Elon Musk announced that self-driving Tesla owners will soon be able to rent out their cars for ride-sharing as a part of Tesla’s shared autonomy fleet.
To put things into perspective, take a read at the tweet below…
i.e. self-driving cars can also provide monetary value to their owners.
Environmental Benefits: Currently, the majority of cars on the roads run on fossil fuels that emit greenhouse gases. The future of autonomous vehicles is electric (mostly) which does not release any harmful pollutants, unlike the existing automobiles of today.
Blockchain Benefits to AV
While the above said benefits are true and very much possible, but blockchain can add further potency into the prowess of AVs. Let’s discuss some of these benefits below…
Parking: Current parking systems require humans to swipe their credit cards at parking meters or paying in cash to the person managing the parking area. Blockchain technology can eliminate human interaction as payments can be made with the blockchain wallet of the user or the digital wallet embedded in the car itself (which will of-course be recorded on the immutable ledger).
Car rentals: Today’s car rental process is very cumbersome. The customer goes to pick up the car, the agent collects credit card, ID, and booking confirmation. The rental system then authenticates this information. The agent then checks car inventory, applies mileage, gas and insurance options to contract. Finally, both parties approve the contract. Blockchain allows for ad hoc transactions. The customer has its id, insurance, and credit card information on the blockchain. The car has rate, mileage and time requirements on its blockchain. If the terms appear suitable to the interested party, he can initiate a smart contract and receive the ownership for a given period as agreed in the smart contract.
Car Insurance: The biggest challenge faced by car insurance companies is Fraud. Insurance requires extensive verification of identity documents i.e. one needs to submit the required identification documents to the insurer to insure your vehicle. The whole process can take days to finalize. With blockchain, everything becomes paperless and swift. If a person’s digital ID is on blockchain i.e. an immutable ledger, then there is virtually no reason to doubt his/her identity.
Capabilities a blockchain should possess to support such complex infrastructure on the chain
One of the key requirements for a blockchain to support AVs on its platform is a requirement of high throughput of transactions. The majority of existing blockchain platforms are plagued with scalability issues. Their current architecture just can’t support high throughput without compromising security and decentralization. Only a few projects like Elrond (a highly scalable blockchain platform using sharding) have achieved a throughput of over 50k transactions per second (TPS) in their testing. In an interview Beniamin Mincu, the CEO of Elrond, talking about Elon Musk’s statement about providing uber-like services with self-driving Teslas says- “That’s the perfect scenario where scalable blockchain architecture with high throughput, fast transaction speed, and low transaction cost is very-very valuable. Because the Tesla, say when it is parked at home, and it needs to drive around and recharge and then come to your place, wherever that may be, while it is doing the recharge, it has to make a payment. That’s the perfect scenario where a blockchain which can transfer value automatically without the need of a trusted third party, it can be used as long as it is very-very scalable”. He further goes on to say that “We are discussing this with some companies that have attempted to build something like this on Ethereum, and it is actually a very frustrating situation, if you think that you can only do 15 transactions per second and you have a fleet, let’s say of hundreds of thousands of cars; There you see the clear limitations (of existing platforms)…”
Another requirement would be of identity services running on blockchain i.e. a blockchain that could provide irrefutable identity proofs (along with appropriate privacy controls). It can ensure only the required information is transferred to the service provider.
The Major Challenge With Blockchain Integration
Blockchain can indeed bring many benefits to AVs. However, there is a major challenge that needs to be addressed. The AV market is heavily fragmented. Sure, Tesla has the lead for now, but other companies are not far behind. General Motors, Toyota, Volkswagen, Uber, Lyft along with tech-monoliths like Apple and Google are also working to compete for supremacy in this space. Should they decide to integrate blockchain into their platform, it is highly likely that they would run their AV fleet on their exclusive standalone private blockchain network (e.g. GM Chain, Apple Chain, Google Chain) i.e. there will be no communication between these private chains; thereby limiting the estimated benefits of AVs (e.g. in platooning where there is effective communication between the lead vehicle and the subsequent vehicle following it). The value delivered to society will be maximum only if they cooperate i.e. either all AVs run on the same blockchain or they seamlessly transfer value between each other’s chains i.e. interoperability (one of the key features of Elrond).
Final Words
The advent of Autonomous vehicles heralds the coming age of a technologically advanced civilization. It will bring numerous benefits to mankind, and ease the resource extraction pressure on mother earth. These benefits will be further amplified by lacing autonomous vehicles with blockchain technology, enabling trustless value transfer between the transacting parties.
NOTE: This article in no way is financial advice of any sorts. Readers are responsible for their own investment decisions.
