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The Power of NFT’s and their use in the Automotive Industry

Intro

While cryptocurrencies have gained widespread popularity due to the growth of Initial Coin Offerings, they are also hotbeds for NFT use. The reason for this is that most cryptocurrencies support the creation of new tokens, called NFTs (Cryptocurrency-based Non-fungible Tokens). They are so named because each token is unique and has its own properties like color or name. These properties make them non-fungible in that a particular digital asset cannot be substituted with another one without affecting the value of the token. Companies that are operating in the automotive industry can take advantage of NFTs to revolutionize their end-consumer proposition by offering more transparency and trust to their customers. By creating a digital version of the paper document known as the Car Sales Agreement, anyone interested in buying a car will be able to read it and understand all terms without going through multiple intermediaries and attorneys.

What is an NFT?

A non-fungible token is a digital asset that is unique and has its own specific properties. Their name comes from the fact that each one of them is unique and has no substitutes. The most common properties of a non-fungible token are their properties as souvenirs, cosmetics or collectables. Another common property is their ownership rights like the right to sell, lend, transfer or lend to another person. Non-fungible tokens are different from fungible tokens in that they are not interchangeable with the rest. Now, the reason why NFTs have become such a hot topic in the blockchain and cryptocurrency space is that they can be used to tokenise any asset and create a digital representation of it. Owners can tokenise assets such as cars and create a digital version of the agreement that is known as a car sales agreement. Anyone who wants to purchase a car will be able to read the terms of the agreement and understand the terms and conditions without the need for a lawyer.

How NFTs will empower the automotive industry?

The automotive industry is a highly regulated and very archaic system that is ripe for disruption. There is a growing demand for transparency, trust and convenience in the auto sector. The current paper-based system is prone to errors, inefficiencies and fraud. And, now with the advent of blockchain and non-fungible tokens, the industry can benefit from NFTs to solve its problems. When an entity like an auto dealer sends a digital agreement on the blockchain, anyone who wants to get a car will have access to the terms and conditions without the need for a third-party service provider. This will be a great step toward bringing transparency and trust to the auto sector. In fact, these are some of the problems that are being solved by NFTs.

Tokenisation of Assets: a game changer for the automotive industry

There is increasing demand for non-fungible tokens for different assets such as arts and collectables, real estate and cars. Now, the automotive industry is being considered another market where non-fungible tokens can be used for asset tokenisation. As stated above, one of the most common properties of non-fungible tokens is their ownership rights like the right to sell, lend, transfer or lend to another person. Now, the automotive industry is a massive market that has a huge amount of data about cars such as their make, model, age, colour, engine power and much more. An entity that wants to list their car on the blockchain can tokenise the car data and create a non-fungible token. This will allow anyone who wishes to buy the car to easily understand the terms without going through a third-party service provider and paying hefty commissions.

Round up

As you can see, NFTs are bringing a lot to the table in the automotive sector. They have the potential to revolutionise the way cars are bought and sold with the introduction of non-fungible tokens. They can also be used to tokenise assets and make them available for sale on the blockchain. The automotive sector is currently highly regulated and archaic. The introduction of non-fungible tokens can bring a lot of change to this market.

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