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NFT-Vehicle: A Blockchain-Based Tokenization Architecture to Register Transactions over a Vehicle’s Life Cycle

Author

Listed:
  • Juan Carlos López-Pimentel

    (Facultad de Ingeniería, Universidad Panamericana, Álvaro del Portillo 49, Zapopan 45010, Jalisco, Mexico)

  • Luis Alberto Morales-Rosales

    (Facultad de Ingeniería Civil, CONAHCYT-Universidad Michoacana de San Nicolás de Hidalgo, Morelia 58000, Michoacán, Mexico)

  • Ignacio Algredo-Badillo

    (Departamento de Ciencias Computacionales, CONAHCYT-Instituto Nacional de Astrofísica, Óptica y Electrónica, Tonantzintla 72840, Puebla, Mexico)

  • Carolina Del-Valle-Soto

    (Facultad de Ingeniería, Universidad Panamericana, Álvaro del Portillo 49, Zapopan 45010, Jalisco, Mexico)

Abstract

The sale of second-hand vehicles is a popular trade worldwide, and vehicle fraud is currently a common issue, mainly because buyers can lack a complete view of the historical transactions related to their new acquisition. This work presents a distributed architecture for stakeholders to register transactions over a vehicle’s life cycle in a blockchain network. The architecture involves a non-fungible token (NFT) linked to a physical motorized vehicle after a tokenization process, which denote as the NFT-Vehicle. The NFT-Vehicle is a hierarchical smart contract designed using an object-oriented paradigm and a modified version of the ERC721 standard. Every stakeholder engages with the NFT-Vehicle through distinct methods embedded within a smart contract. These methods represent internal protocols meticulously formulated and validated based on a finite-state machine (FSM) model. We implemented our design as a proof of concept using a platform based on Ethereum and a smart contract in the Solidity programming language. We carried out two types of proof: (a) validations, following the FSM model to ensure that the smart contract remained in a consistent state, and (b) proofs, to achieve certainty regarding the amount of ETH that could be spent in the life cycle of a vehicle. The results of the tests showed that the total transaction cost for each car throughout its life cycle did not represent an excessive cost considering the advantages that the system could offer to prevent fraud.

Suggested Citation

  • Juan Carlos López-Pimentel & Luis Alberto Morales-Rosales & Ignacio Algredo-Badillo & Carolina Del-Valle-Soto, 2023. "NFT-Vehicle: A Blockchain-Based Tokenization Architecture to Register Transactions over a Vehicle’s Life Cycle," Mathematics, MDPI, vol. 11(13), pages 1-29, June.
    • Handle: RePEc:gam:jmathe:v:11:y:2023:i:13:p:2801-:d:1176474
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    References listed on IDEAS

    as
    1. Montag, Josef, 2017. "Identifying odometer fraud in used car market data," Transport Policy, Elsevier, vol. 60(C), pages 10-23.
    2. Dowling, Michael, 2022. "Fertile LAND: Pricing non-fungible tokens," Finance Research Letters, Elsevier, vol. 44(C).
    3. Dowling, Michael, 2022. "Is non-fungible token pricing driven by cryptocurrencies?," Finance Research Letters, Elsevier, vol. 44(C).
    Full references (including those not matched with items on IDEAS)

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