California DMV Digitizes Vehicle Title Management System Via Tezos

The California Department of Motor Vehicles (DMV) is testing the digitization of car titles and title transfers via a private Tezos blockchain.

The move is part of a collaboration between California DMV, Tezos, and software company Oxhead Alpha, with the latter announcing a successful proof of concept on January 3rd. 25.

The California DMV has hired Oxhead Alpha to build on Tezos’ private testnet dubbed the “Shadow Ledger.” It is primarily designed to become a blockchain-based replica of the agency’s existing database.

Ajay Gupta, chief digital officer at DMV California, told Fortune Jan. 3. 26 that the agency looks forward to reconciling the ledger within the next three months.

Next, it is looking to roll out applications such as digital wallets to hold and transfer NFT vehicle addresses, with the DMV acting as the go-between to oversee such operations.

“The DMV’s perception of backwardness definitely has to change,” Gupta told Forbes.

Andrew Smith, head of Oxhead Alpha, explained that the California DMV blockchain initiative will serve a wide range of use cases for the agency, particularly in terms of modernizing its existing paper-based systems.

Smith highlighted examples such as transaction fraud, where car sellers hide key information about a car’s condition to dump a breakdown or “lemon” on unsuspecting buyers.

While defective vehicles have a special designation on their California titles, Smith noted that sellers can move the vehicle to another state and hide the defective designations with relative ease.

Smith suggested that with the use of blockchain-based record-keeping, and with other DMVs likely adopting the technology, it would be much easier to digitally track the physical history of vehicles.

“In terms of the benefit of having a permanent digital address, that’s a very clear use case,” he said.

Commenting on why Tezos is a perfect fit for the DMV, Smith explained in the company’s January 28 report. 25 declares that blockchain “solves some really tough problems in blockchain in an elegant way.”

“The combination of responsible consensus, on-chain governance, and enterprise security makes Tezos a great platform for offering production-ready solutions,” he said.

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Transfers from the California DMV by others in the state will likely follow moving forward. In May 2022, California Governor Gavin Newsom signed an executive order to direct and explore blockchain technology integration opportunities with state government agencies.

“California is a global center for innovation, and we are building the state to succeed with this emerging technology—to spur responsible innovation, to protect consumers and to leverage this technology for the greater good,” said the governor.