California puts DMV on the blockchain

by Arthur · February 10, 2023

California DMV is experimenting with blockchain. AaronP/Bauer-Griffin/Getty Images

Many of the trends and ideas that shape America first come to California, so it’s worth noting that the state has introduced a major technical upgrade at the Department of Motor Vehicles. As Fortune was the first to report, the agency is in the final stages of copying its title database onto Tezo’s blockchain and expects to launch consumer-facing applications linked to the blockchain within three months.

In practice, this means California drivers will soon be able to hold their car titles as NFTs in their digital wallets, and the DMV will streamline the cumbersome process of title transfers. Based on comments from the agency’s chief digital officer and from the software firm overseeing the project, the initiative sounds serious—and potentially transformative.

If millions of Californians start relying on blockchain to track ownership of their cars, other states will soon follow suit, and the crypto industry will finally be able to point to a big real-world use case for the technology. If this happens, it’s not hard to see other agencies and institutions — think land title offices and university transcript departments — adopting blockchain as well.

Most important of all, California’s DMV project could lead to a breakthrough in digital identity. For a decade now, crypto boosters have hailed blockchain as a way to stop relying on data-guzzling companies like Google and Facebook to log into websites — and instead rely on the privacy protections offered by blockchain to enjoy a “sovereign” identity on the web. Until now, the dream of “sovereign identity” has been a piece of heaven since ultimately it is the state and not a crypto startup that has the ultimate authority to verify that you are who you say you are. If California decides to expand the DMV blockchain program, it could mean it will be possible to rely on tools like zero-knowledge proof to prove things like your age or identity without revealing a host of other personal details.

Yes, there is no guarantee that this will happen, and the California DMV project could fall apart, especially since states have previously announced blockchain projects that amounted to little. Vermont, for example, announced it would put land titles on the blockchain in 2018, and so far this has appeared to make little difference to the lives of homeowners there or elsewhere.

Yet this time feels different. Blockchain technology has evolved and California has a history of introducing major innovations to its vast population that spread to the rest of the world. If it solves this, many of us could be carrying NFTs off our driving licenses in 5 years.

Jeff John Roberts
[email protected]
@jeffjohnroberts

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