Cario's platform would transfer car titles more quickly on blockchains
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According to the founders of Cario, a new blockchain-enabled application that spun out of a car leasing company, everyone in the auto industry wants to change the way car titles are handled.
Why it matters: The trillion-dollar industry of cars in the U.S. is going through a massive shift, to electrification now and perhaps to self-driving soon — but amid all that technical advancement, car ownership is largely still documented on paper, Brady writes.
Driving the news: Cario aims to empower administrators in all 50 states to track the transfer of titles using a blockchain-enabled system that would register ownership changes faster, while leaving the car owner in control of their documents.
What they're saying: "You are at the risk of the piece of paper that's being presented to you," Nathan Hecht, the founder and CEO of Cario explained to Axios.
- Those risks include simply misplacing it, but also theft and fraud.
Zoom in: CarFax warns that many consumers overpay for cars because of title washing scams that hide issues with the vehicle.
- And as online sales of cars has become more popular, buyers nationwide have complained about problems getting their hands on their titles, even after they physically have the car.
- "That's rampant," Hecht said.
How it works: Cario is looking to create a secure network-of-networks that would facilitate transfers digital titles.
- Different stakeholders — including various state DMVs, auto dealers, insurance companies, lenders, and owners — would interact with the network as needed on a peer-to-peer basis, updating any change to a title and sharing it with the entire network, according to its whitepaper.
Between the lines: Hecht said the basic technology, its first version, has already been built. The part its chief stakeholders will use is based on Corda, a private blockchain technology.
- Consumers will be able to produce verifiable proof of valid titles from a public blockchain (currently, the plan is Polygon) — though what's published there wouldn't expose personal information.
- This would make it basically impossible to doctor details in a car's history in order to trick buyers.
The intrigue: Immediate title transfers would mean cars can change hands more quickly, and dealers could reduce carrying costs for newly delivered vehicles — all of which could mean better prices for consumers.
State of play: The team behind Cario has been working on it for about 18 months, but it's not in use anywhere yet.
- In California, they are kicking around a similar idea (the state DMV did not respond to a request for an update on its pilot). West Virginia has done some work too.
Reality check: Cario won't be able to get off the ground without government buy in, but in most places it can move forward if the state's DMV is okay with it. In some states it will need legislative changes.
What's next: The team expects to get the beginnings of its business going even before it's an official mechanism for transferring titles.
- It has potential partners, particularly among lenders, who believe they could make use of it now to limit internal paperwork.
What we're watching: Cario spun out of Hecht's prior company, Rodo, which has funded Cario so far. The team is seeking a first round of investment now.
