Digital Car Titling: Putting Blockchain in the Driver's Seat

By Shane Bigelow posted Feb 04,2020 09:51 AM

Shane McRann Bigelow, Chief Executive Officer, Ownum

Digital Car Titling: Putting Blockchain in the Driver's Seat

Since the dawn of human civilization, information exchange has been critical to survival and progress.  Early cave paintings and later clay tablets served as primitive ways to record events and information.  The advent of paper led to ledger books.  Eventually, business computers established a way to process information and store records electronically.  Today, the internet makes mission-critical information accessible at all times, globally.

Data ubiquity powers the digital economy, but this ubiquity also puts precious data at risk, exposing us to hacks, theft, and fraud, which undermine trust.  With cyber crime an ever present danger, we need a better way to protect data.

In recent years, blockchain technology has emerged as a critical tool for protecting data and bridging the trust gap.  Blockchain technology was designed explicitly for secure record keeping and information transfer.  Information entered into a blockchain record cannot be changed once written, offering an immutable chain of custody, and with it, transparency and security that promotes trust.

Blockchain maintains data integrity.  But how can state government take advantage of it and apply this new technology to legacy process?

To illustrate the potential impact of the technology, let’s take vehicle titling as an example.  Titling a new car upon sale remains a largely paper-based process, which involves coordinating several stakeholders.  Like all paper-based processes, it is inefficient and prone to human error and unnecessary delay.  Even moderately sized states use an estimated 18 million sheets of paper per year to process car titles!

In 2020, the issuance of a paper title to prove ownership of an asset seems like an incredible anachronism. State CIOs have agreed there should be a better way.  Knowing that digitization could unlock significant cost efficiencies, adopting "Digital Government" was top of NASCIO's list of policy and technology priorities this year.  Indeed, the evolution is underway with many states already looking to digitize paper processes in many areas.

While data security remains a primary roadblock on the path to digital efficiency, digitizing car titles is a logical and promising place to start the next leap in evolving how society handles, stores, and shares data.

That is why a digital car title solution must be built with a security first mindset using blockchain technology that is encrypted, executable, and distributed. These characteristics mean we can prevent fraud and counterfeiting as each digital vehicle title is unique and cannot be duplicated.  All stakeholders - consumers, dealers, title issuing authorities, lenders, and insurers - ensure the data is correct and can make corrections independent of the digital title.  Finally, customizable business rules can be defined and enforced automatically, ensuring the proper requirements are met during title issuance, transfer, reissue, and the addition and removal of liens.  

With security assured, government is free to serve constituents with an enhanced digital system, dramatically reducing the time to complete the titling process for all parties.  For government, control of the process is retained and authorities receive instant, high-fidelity data on a process which generates tax revenues. Beyond security, time efficiencies and control, projected cost savings realized by this transformation allow government to pursue other priorities previously out of reach.

Vehicle titles are just one example of a process that could be transformed by digital government.  The next leap in the evolution of our relationship with data is here, and in the near future, digital government will no longer be an item atop a list of New Year priorities but will instead be a realized accomplishment in our history, remembered as a moment when digital processes spurred new possibilities for state government.