Tokenisation in Tyre Waste Management & Autonomous Vehicles
A circular economy is an industrial system that is restorative or regenerative by intention and design. The “end of life” concept is replaced with the concept of restoration and strives for waste elimination through the innovative design of materials, products, systems and the introduction of novel business models. Through numerous technological advances, recycling has become increasingly more viable through the deployment of technology such as radio frequency identification (RFID) and IoT. The deployment of these technologies has created greater efficiency with respect to logistics, knowledge sharing and tracking of materials.
Blockchain technology can also be used in other waste management industries and plays a pivotal role in ensuring that recyclables do not end up in landfill. Digital tracking of data allows for deeper analyses of supply chains. Utilising this technology with IoT devices and RFID, greater efficiencies can be gained and roque activity marginalised. Such activity has been prevalent in the tyre recycling industry across the globe. Each year, 1.6 billion new tyres are generated, and around one billion of waste tyres is generated. The collection and recycling of tyres and prevention from landfill, sensitive habitats and abandoned areas remain a challenge for the industry globally. The tyre supply chain consists of the production of raw materials, the production of tyres, the distribution of tyres, the use of tyres and then the collection, sorting and recycling of end of life tyres (ELTs). ELTs are processed into rubber granulate and energy recovery.
There are therefore a number of stakeholders involved in the industry, which include raw material producers, tyre manufacturers, buyers and sellers, waste collectors, recyclers, logistics companies and the government, who oversees the recycling industry from a regulatory and governance perspective. In the supply chain, the raw materials constitute the basic unit out of which a tyre is produced. This is the basic material from which a tyre is created. The tyre manufacturers could therefore tokenise the raw materials. The token would represent a digital twin that is a depiction of the raw materials in the form of a token utilised to trace the raw materials throughout the supply chain. This allows stakeholders to follow the newly-defined asset throughout the supply chain.
There are a number of ways to digitalise the raw materials in a tyre. The raw materials could be deemed a non-fungible asset, an asset in the form of a token, which through cryptography would help to prove verifiably the ownership and authenticity of the asset. If a specific batch of raw material is required to be traced throughout the supply chain, then this approach would be more feasible. The raw material producers would generate tokens, which are then supplied to the logistics companies. The logistic companies take the raw material and the equivalent amount of tokens that are representing the amount of raw materials in weight and transport or ship them to the tyre manufacturing plant. The manufacturing plant receives both tokens and raw materials and produces tyres. The tyre producer can therefore continue with the token that represents the weight, or the token can be converted to represent the actual number of tyres produced. The raw material tokens can therefore be spent in exchange of a "tyre token" that will be issued by the manufacturing plant.
Another option would be to create a batch token that represents the weight of raw material utilised to make a batch of tyres. This batch of tyres, once manufactured, is moved to a warehouse. A seller of the tyres has both a batch of tyres for sale and the equivalent number of tokens that represent the batch of tyres. As tyres are sold, a quick response code could be scanned to verify the authenticity of the tyres in the supply chain. Additionally, the buyer of the tyres could be provided with the token that verifies the authenticity of the tyres purchased. As the tyres are replaced in the future and
ELTs transported to waste tyres processors, there is full visibility and traceability along the entire supply chain. The tokens therefore represent the validation of the genuineness of the product itself.
The rise of autonomous vehicles is set to be transformational as the market is set to reach USD 42 billion by 2025. While ethical challenges with respect to split-second decision-making remain a major concern, a greater understanding of the ethical guidelines artificial intelligence (AI) will follow will need to be understood in great depth. When driving, individuals learn from their own mistakes. They rarely learn from others, collectively making the same mistakes over and over again. AI, on the other hand, evolves differently. When an autonomous vehicle makes an error, all of the other autonomous vehicles are able to learn from it. In fact, new autonomous vehicles will inherit the complete skill set of their ancestors and peers; so collectively, these cars can learn faster than people.
If this data is recorded on the blockchain, new autonomous vehicles essentially evolve at a rapid pace since the data is available immediately via the distributed ledger. It is inevitable that in a short period of time, autonomous vehicles will manoeuvre along roads in conjunction with human-driven cars. Sophisticated AI tools and distributed ledger technology will empower individuals to better learn from the experiences of others. The increased use of autonomous vehicles is ultimately premised on trust. The individuals who buy or use them have to trust the technology and must be comfortable using that technology for its true value to be realised. In order to build this trust and acceptance, autonomous vehicle manufacturers must ensure the technology is safe, secure and creates a leap in value for consumers. The machine world and social world will
therefore operate in unison.