Standardized Web3 Solution for Vehicle Registration, Titling, and Liens

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About Our Web3 Cross-Industry Interoperability Pilots

Alongside our global community, we’ve demonstrated several potential use cases for Citopia and Integrated Trust Network (ITN) services through various pilot projects. Together, Citopia and the ITN provide the necessary infrastructure for node operators to build out secure, seamless, globally compliant web services and applications. MOBI membership is required to operate a node on Citopia and/or the ITN. Contact us to learn more about becoming a node operator

Overview of the Pilot and the Problem It Solves

Across the United States, there is a diverse array of jurisdictions (numbering in the thousands across states, counties, and municipalities) and titling/registration service providers, each maintaining unique databases and processes for vehicle registration and titling. Many states (AZ, DE, GA, FL, LA, MA, MD, NC, SC, PA, VA, and WI) currently mandate the use of electronic lien and title (ELT) systems. Other states have planned ELT mandates in 2024, or more generally are developing a digital approach to electronic vehicle titling. For example, New York and Idaho have or are developing processes for dealer reassignments electronically.

Each of these jurisdictions will maintain their own systems for these varied processes. The challenge lies in achieving interoperability between those systems through standardized communications and data reporting/exchange across jurisdictional, platform, and organizational lines while enabling each jurisdiction to maintain control over its processes. For example, today, each vehicle manufacturer or lender can have hundreds of unique identifiers assigned to them by different jurisdictions, creating confusion, mismanagement, and inefficiency.

Currently, secure digital authentication and communication rely on identifiers issued by centralized platforms to prove their credentials. However, in addition to being vulnerable to fraud, identity theft, and data leaks, centralized approaches to identity management fail to address the trust problems created by the rise of decentralized services, IOT, and Generative AI. As digitization advances, it will become increasingly challenging — and costly — to verify data authenticity, secure digital perimeters, and ensure cross-border regulation compliance. This is critical for state agencies like MVAs as well as dealers and lenders, who are responsible for executing the bulk of the registration/titling process.

Stakeholders:
Vehicle Manufacturers (OEMs); Financial Institutions (FIs)/Lenders; Servicers; Dealerships; Motor Vehicle Authorities (MVAs)/Third-party Registration/Titling Providers (RTPs); State Authorized Inspectors; Third-Party Data Consolidators; Fleet Operators; Trade Associations; Vehicle Auctions; and Consumers.

Our Innovative Solution

Overcoming these challenges calls for a new solution. The White House’s Federal Zero Trust Strategy (2022) mandates that federal agencies and any organization that works with the federal government adopt a Zero Trust framework by the end of FY 2024. Zero Trust requires every entity to authenticate and validate every other entity for every single digital communication at all times. Since this is not possible at scale through Web2/centralized means, Web3 technologies and principles must be leveraged.

MOBI and its members have developed platform-agnostic standardized “universal translators” that work with any existing legacy system or web service to enable cross-industry interoperable communication through World Wide Web Consortium (W3C) decentralized identity and verifiable credential framework, called Citopia Passports (Web3 Plug-and-Play). Citopia Passports ensure that organizations’ and customers’ data privacy, which is key for complying with comprehensive data privacy laws being passed by many states (e.g., CA, CT, OR, TX, UT, VA).

  • Zero Trust Authentication: Cross-industry interoperability requires claims and identities to be verified for each transaction to ensure maximum security. Read the Federal Zero Trust Strategy

  • Infosec & Selective Disclosure: Participants must be able to selectively disclose information for transactions at the edge. Verification must be done at the moment of transaction to eliminate the need for PII storage.

  • Scalability and Extensibility: Cross-industry interoperability requires a shared standards-based framework to enable the creation of globally scalable multiparty applications.

  • Data Privacy Compliance: Cross-industry interoperability requires (1) compliance with existing global data privacy regulations and (2) the flexibility to comply with future directives.

  • Global Standards: Cross-industry interoperability requires a standardized system for frictionless data exchange and collaboration while allowing stakeholders to retain their legacy systems.

  • Decentralization: Cross-industry interoperability requires a community-owned and -operated infrastructure to (1) prevent monopolization and (2) enable consensus-based trust.

Web3 Plug-and-Play

Citopia Passports utilize W3C Decentralized Identifiers (DIDs) and Verifiable Credentials (VCs) standards. This creates an interoperability framework that provides:

Explore Citopia Passports
  • Decentralized, trusted identities

  • Digital credential issuance/verification

  • Interoperable communication between each stakeholder’s centralized databases

  • A bridge between jurisdictions, organizations, and platforms allowing each stakeholder to keep their legacy systems

The result is the reduction of errors, streamlined operations, increased efficiency, and reduced costs, as well as greatly improved data permissioned-access. More generally, this cross-industry, platform-agnostic, universal interoperability is part of what has motivated government interest worldwide in implementing and adopting standards-based digital identity and credential systems (e.g., the Department of Homeland Security (DHS) in the US; European Union Agency for Cybersecurity (ENISA) and European Self-Sovereign Identity Framework (ESSIF) in the EU).

Proposed Stakeholder Meeting

MOBI is proposing a two-part meeting in the first half of 2024: part one being a meeting between the association stakeholders (e.g. AAMVA, NADA, ATAEs, NIADA, AFSA, MOBI) and their representative members, and part two being a meeting including the titling service providers. The goals of the meeting are:

  • to bring together the key stakeholders to assess the pain points, needs/requirements, and path forward to achieve interoperability between the numerous centralized systems for registration/titling
  • to jointly address the opportunity to develop standardized communication between each stakeholder to achieve interoperability for registration/titling processes
  • to discuss how secure, verifiable digital identifiers and claims (using open-standard Web3 technologies) can address fundamental problems, such as each lender having hundreds of different identifiers assigned to them by different jurisdictions
  • to finalize the scope and scale of the Standardized Web3 Solution for Titling/Registration Pilot

Pilot Planning

In Phase 1 of the Pilot, the FSSC WG will demonstrate privacy-preserving cross-industry interoperability for Titling/Registration via standardized universal identifiers and communication/claims without the need to build new infrastructure. This will involve working with MVAs, lenders, dealers, OEMs, and service providers to demonstrate interoperability across different legacy systems and jurisdictions. At the end of Phase 1, stakeholders will have successfully created Citopia Passports and be able to use their Citopia Passport to easily authenticate each other’s identifiers and claims (such as lien release, odometer disclosures, insurance validation, etc.). Stakeholders will be able to examine the code and outputs to verify that all transactions/communications are private and only visible to the intended recipient.

In Phase 2 of the Pilot, each stakeholder will have the opportunity to run nodes, conduct research and development for their own applications, and actively participate in the pilot for a duration of 6-12 months. The FSSC WG will determine the final scope of Phase 2 after the conclusion of Phase 1.

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Interested in learning more about MOBI, our community-owned and operated Web3 Infrastructure, and our interoperability pilots? Contact us at connect@dlt.mobi to get in touch with the team!

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