Autonomous Datasets and V2X Transactions: Blockchain in Mobility Pilots Getting Traction

Jules Besnainou

With connected, electric, autonomous and shared mobility on the way, systems that can handle increasingly complex data and transactions have to be built. In the last couple of years, automakers and blockchain companies alike have been exploring ways to apply distributed ledger technology to the mobility space and tackle some of these challenges.

Ahead of our executive summit on Blockchain in Energy & Mobility taking place in New York on October 24th, we talked to some of the major market participants in the field to get their insight (a few of which are speaking at the event).

In our research, we identified around 30 projects pursuing these opportunities. Blockchain is mainly being piloted for:

  • Identifying parts provenance and building vehicle ID ledgers
  • Logging telematics and other vehicle data in a tamper-proof manner, unlocking usage-based models
  • Enabling Vehicle-to-X transactions, opening a range of potential applications

Here is a view of how this plays out along the mobility value chain:

Vehicle data enabling usage-based models and autonomy

Chris Ballinger – the CEO of MOBI, a blockchain in mobility research consortium – sees storing vehicle identification and history on blockchains as the first step toward any additional service. In MOBI’s first use case development, which launched in May, the consortium is layering increasing amounts of vehicle data on a blockchain. In addition to registration documents, the system stores maintenance history, parts changes, accidents and vehicle telematics. Should such a system be adopted, it would enable a more transparent resale market and correct the asymmetry of information between buyer and seller, raising the value of the used stock. With this data, additional services could be proposed to drivers, such as usage-based insurance – another project MOBI is working on – with insurers like Achmea or Aioi Nissay of Japan. Wanxiang Blockchain, a subsidiary of the Chinese automaker, is working on a similar usage-based leasing model for EV batteries.

Distributed ledgers can also allow for sharing different layers of data with different users in a safe way, and being rewarded for such. Ocean Protocol, a BigChainDB spin-off, is building a data marketplace for autonomous vehicle developers. On it, operators will be able to share data on autonomous trips anonymously to feed algorithms with test data and accelerate progress in autonomy. In a pre-ICO token offering last March, Ocean Protocol raised some €9 million for this project. Ocean will undoubtedly face competition – a few similar data exchanges are being built – but the underlying idea of offering datasets as a service is very attractive, especially in a market where access to data is a key differentiator.

Mobility wallets and V2X transactions

As cars get more autonomous, they will increasingly need to exchange data and value with their environment. This could include:

  • Paying for tolls, and road usage and congestion charges
  • Paying for electric charging or parking
  • Compensating front vehicles in platooning
  • Getting paid by passengers for rides

While some of these functions could be performed by traditional payment methods, distributed ledger technologies are being built for these machine-to-machine transactions, and will be better positioned to take on a multitude of micro-payments according to certain rules of governance layered in smart contracts. They could also provide superior security and auditability.

Germany-based Motionwerk, an Innogy spin-off and pioneer in blockchain wallets for EV charging and related services, launched its first Share & Charge app to the public in April 2017. For a year, EV users could charge at up to 1,500 charge points put on the network by other users. While the peer-to-peer transactional business model did not work out, as there was not enough transaction volume to support development, it did give Motionwerk unparalleled experience in designing mobility wallets and related interfaces. The company is now developing an open-source protocol for charging networks to operate their stations on blockchains and take on smart charging and V2G opportunities, with the collaboration of companies like Volkswagen, which are looking for better charging solutions for their EV customers. Motionwerk CEO Dietrich Sümmermann also hopes to convince charging network operators and utilities that this transaction infrastructure will be more efficient and future-proof than incumbent systems. He is currently setting up Share & Charge as a non-profit foundation to raise money from a token offering.

MOBI CEO Chris Ballinger sees equipping cars with blockchain-powered wallets as a viable commercial opportunity. According to him, “it’s a clear path from near-term applications like Share & Charge to futuristic ones, incenting better behavior at the city scale.”

For instance, a blockchain wallet can already pay tolls as they exist today. But in the future, it could exploit vehicle telematics data to support smarter tolling, based on number of passengers in the cars, vehicle emissions, congestion conditions, etc. Chris Thomas, co-founder and partner at Fontinalis, which invested in companies like Lyft and Turo, aptly calls this “V-commerce” for the all the services that vehicles will be able to purchase.

Early stages, big players

Investors rightly point out that while some of these use cases show great promise, they would be difficult to fund near-term. Chris Thomas of Fontinalis says, “the economics and friction relative to incumbents are not feasible in some cases, and very difficult in most.”

It is important to bear in mind that many of these use cases rely on network effects to provide value. For a vehicle ledger or wallet to be helpful, it needs to be able to interact with various market players across multiple companies and third parties. This poses the question of standards and common infrastructure.

One response from industries to foster common approaches, and to mutualize the costs of research and development, has been to build industry consortia. R3 in the financial sector, and Energy Web Foundation or Enerchain in energy, are key examples of that. The same movement is happening in transportation, with a few groups taking off:

  • Created by former Toyota executives, MOBI aims to facilitate and foster research at the intersection of blockchain and mobility. It has signed up auto OEMs like BMW, Ford and GM, but also insurers and blockchain innovators. The consortium works on a membership fee, and experiments into use cases are led by groups of members, sometimes contracting blockchain innovators to help out.
  • Motionwerk is also recruiting partners in Germany to create OMOS, or Open Mobility System, with data sovereignty as a key pillar.
  • In the trucking and logistics industry, the Blockchain in Transport alliance has recruited more than 300 members to drive common standards for blockchain in freight. The alliance was founded by Freightwaves, a Fontinalis-backed provider of data for the logistics industry.

Some corporates are choosing to build their own ecosystem of blockchain innovators. That is the case of Chinese auto giant Wanxiang, which set up Wanxiang Blockchain to grow an internal R&D team and invest top blockchain startups. It now has a portfolio of 60+ companies, and has grown an internal blockchain team of more than 150 people. Peter Luo, CTO of Wanxiang Blockchain, says that the technology is opening new ways of thinking about their business, like the usage-based financing mentioned above.

We’ll continue to track this growing intersection of blockchain and mobility, just like we do in energy. If you would like to hear more and discuss with the top players in the field, request an invitation to our upcoming executive summit on Blockchain in Energy & Mobility (October 24th, New York City). If you have any questions, don’t hesitate to reach out to me at jules.besnainou@cleantech.com.