Imagine this. Cars that not only drive themselves, but also manage themselves, find paying customers for rides and send profits back to the stakeholder organisation that funded their existence.
All the technology needed to do this exists today.
- The driverless vehicle is a reality.
- Uber has pioneered a computing platform and app that puts chauffeurs and customers in contact with each other while also guaranteeing payment for rides.
- Enterprises like Slock.it offer smart contract locks which allow mobile phone users to immediately access vehicles after making a payment.
- Electric vehicles can be recharged by parking them over an inductive charging plate in the ground.
The stake-holding organisation that is both decentralised and autonomous is, of course, a DAO - or decentralised autonomous organisation, of which ‘The DAO’ of 2016 was a prime, if not slightly confusing, example - but we’ll explain below.
Once all the necessary code for the autonomous vehicle is written, it can be inscribed as a smart contract on a blockchain. There it remains immutable and unfalsifiable, recording transactions, distributing profits according to smart contract terms, and making sure the vehicles regularly check themselves in for service and safety checks.
The decentralised autonomous organisation is governed by smart contracts and exists on a blockchain. There is no CEO, no single person who can dictate what activities will be undertaken, which investments made or how the rules of the organisation will evolve. Rather, these matters are decided by the members of the organisation who participate by buying tokens issued by the organisation.
‘Tokens’ may well make you think of Ethereum or other distributed platforms designed to support smart contracts. Indeed, ‘The DAO’ (note the use of the definite article) that was created in 2016 used Ethereum and its token mechanism to raise more than US $150 million in venture capital. Investors received tokens giving them voting rights for investment projects.
The subsequent hack of ‘The DAO’ led to a hard fork of the Ethereum code, but not before Slock.it (smart contract locks) and Mobotiq (a French electric vehicle start-up) had presented themselves to ‘The DAO’ for possible funding. How’s that for prescience?
For the rest of this article any references to a DAO or the DAO will mean a or the blockchain-based entity for totally autonomous vehicles.
So, can we now hit the blockchain highway and drive off in a new paradigm of automotive transport? Not so fast.
The technology may be available but the legal context is still unclear. Before crowing about how decentralised systems like DAOs let people break free of state fetters, it would be good to remember that the absence of a clear legal structure can also work against DAOs.
As a DAO is a virtual entity, it relies on physical providers to get things done. These providers may create for the DAO - as in writing smart contract code to recover profits from rides or manage vehicle maintenance - or provide for the DAO - ‘We’ll take 10,000 of your fine and dandy all-electric driverless hatchbacks’.
However, a DAO (currently) has no standard legal status. This can cut several ways:
- If the software applications or vehicle in question are unreliable or dysfunctional, the DAO cannot take legal action to recover money spent on them.
- If the hatchback cars run amok and mow down prized flowerbeds or worse, the absence of legal status for the DAO may turn into unlimited legal liability for the participants (no matter what the smart contract says).
Additional challenges include the difficulties of changing smart contract code if it has bugs. DAOs may also be interpreted by national governments in different ways, such as the SEC ruling in the United States that DAOs were in violation of regulations on financial securities.
Other DAOs have had to face similar problems. However, in many cases, other DAOs have remained in the virtual world, trading digital coins or digital content.
By comparison, a DAO for vehicles crosses over into the physical world, where many things can change. Anyone who has experienced the two environments of business IT - dealing largely with virtual data structures - and industrial IT -or OT (operational technology) controlling anything from real-world production lines to power grids - will know how different they can be. A DAO for vehicles will likely be more complex than a DAO for cryptocurrencies.
In summary, certain issues still need to be ironed out, even if they are not insurmountable. Yet when this is done, decentralised autonomous vehicles, or dare I say it, DAVs, could become blueprints for similar initiatives to invest in any other asset you can think of, whether for private, commercial, or industrial use.