California Testing NFT Car Titles Leaves More Questions Than Answers
California Testing NFT Car Titles Leaves More Questions Than Answers
A few days ago, the California DMV announced that it is testing the use of NFTs as car titles on a private blockchain on the Tezos $XTZ network.
California DMV chief digital officer Ajay Gupta said in an interview with Fortune that California is trialing the use of NFTs on a private Tezos blockchain. According to Gupta, the move will “increase efficiency and transparency while reducing costs.”
Importantly, Gupta noted that a proof-of-concept model has already been through testing and that the Department of Motor Vehicles hopes to have its title database fully replicated on the private Tezos blockchain within three months.
There are many ways to ask the obvious question this brings to mind, and we’ll start with “who cares?” with “does this matter in the slightest?” as a close second.
The answer here is, well, it depends.
Are you a crypto investor? If so, this isn’t going to be directly influencing your Tezos investment, so your answers are “(mostly) not me” and “no”.
Are you living in California, in the market for a new car, and a tech-forward individual? Then it's “I care” and “yes”.
The reason crypto investors should be rather neutral-to-not-caring about this is because, well, there really isn’t any direct influence on Tezos' price that is going to arise from this. In fact, it is completely likely that Tezos users are actually going to end up reinforcing the private layer 2 DMV blockchain, without seeing any increase in demand for Tezos tokens.
Private blockchains are nothing new. They have existed in companies for many years as a way to manage data. If I want to change something in the database, I need some people to approve it on their end and then my data (block) can get added to the database (chain).
While this is true, allowing outside people to lay claim, with or without access to the literal NFT and not a digital copy that the DMV shares with you, is new.
While Tezos investors shouldn’t feel like they struck the motherlode with this deal, it could yet be meaningful for the blockchain.
With the first one being built on the Tezos blockchain, logically, when Oregon, Washington, and others follow suit, Tezos will make logical sense. When a Californian sells their car to an Oregonian, it just makes sense that they would want to avoid adding a step to wrap the NFT in some other crypto.
But again, that would be another private blockchain. The really important thing would be that Tezos, unlike other blockchains, actually have their foot in the door of reality.
If you are a Tezos investor, you are hoping that this partnership can lead to integration in other ways that directly increase demand for Tezos through real-world use.