(Kitco News) - The California Department of Motor Vehicles (DMV) has announced the successful completion of a proof-of-concept blockchain-based vehicle titling solution that was conducted in partnership with Oxhead Alpha.
The goal of the trial was to explore the potential for blockchain technology to improve the DMV's current processes, as outlined in the California Blockchain Working Group Roadmap, and to “incorporate the values detailed by Governor Newsom in his recent blockchain executive order.”
“DMV is exploring innovative blockchain solutions to help increase efficiency, boost transparency and reduce economic costs,” Ajay Gupta, chief digital transformation officer stated in the California Blockchain Workgroup Roadmap. “This would avoid repeated verification steps for customer and State/public service entities, resulting in reduced workload, economic benefits and auditability.”
Oxhead Alpha was selected by the DMV to build a platform based on “responsible innovation, protecting consumers, and leveraging technology for the public good.” The firm selected the Tezos blockchain to host the pilot project.
“Choosing Tezos for vehicle titles aligns well with California values,” said Andrew Smith, president of Oxhead Alpha. “Tezos solves some of the really hard problems in blockchain in an elegant way. The combination of responsible consensus, on-chain governance, and institutional grade security makes Tezos a great platform for delivering production ready solutions.”
Oxhead Alpha developed a set of smart contracts to solve trusted vehicle transfers and deployed them on a private fork of Tezos for testing purposes. Trusted transfer is one of the main challenges for an e-titling solution. The smart contracts were designed to test e-titles, enabling the electronic exchange of title information which could help significantly decrease the time it takes to process documentation. California had over 30 million registered vehicles as of 2020.
“The smart contracts enable escrow behavior with DMV administered checkpoints to ensure compliance and reduce processing time,” the announcement said. "The system uniquely establishes a mechanism for the efficient and secure transfer of vehicles between jurisdictions."
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Following the successful trial, the CA DMV is expected to develop consumer-facing applications such as digital wallets and car title NFTs later this year, according to Gupta. In an interview with Fortune, the chief digital transformation officer said that he hopes the plans to create the title database on blockchain come to fruition in the next three months.
Last year, California Governor Gavin Newsom signed an executive order directing state agencies to “begin the process of creating a regulatory approach to spur responsible innovation while protecting California consumers, assess how to deploy blockchain technology for state and public institutions, and build research and workforce development pathways to prepare Californians for success in this industry.”
