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The California Department of Motor Vehicles (DMV) is trying to digitise car titles and title transfers on a private Tezos-built blockchain.

The state agency has collaborated with Tezos and blockchain software firm Oxhead Alpha to build a successful proof-of-concept.

The move is part of a wider push to modernise the state’s in-place systems for car titles and increase transparency in title transfers. California’s DMV is responsible for all vehicle registrations and driver’s licences in the state.

Oxhead Alpha has built a Tezos testnet designed as a blockchain-based replica of the DMV’s current database.

Ajay Gupta, chief digital officer at the California DMV, said that the agency wants the testnet to be fully functional in the next three months.

In the future, it wants to launch applications like digital wallets that California citizens can use to hold and transfer non-fungible token (NFT) car titles.

“The DMV’s perception of lagging behind should definitely change,” Gupta said in an interview with Forbes.

Andrew Smith, president of Oxhead Alpha, said that the DMV’s blockchain initiative will be used across a wide range of use cases. The central focus will be on modernising its existing paper-based systems.

Transaction fraud, where sellers hide issues with a vehicle’s condition to sell it off to unsuspecting buyers for more than it is worth, is one such issue the DMV hopes to focus more on.

Currently sellers can easily move their car to another state to hide faults that would be required on their titles in California.

Blockchain-based record keeping, along with increased corroboration between other states’ DMVs, would make it easier to digitally track vehicles’ history accurately, Smith said.

On why the Tezos protocol was picked, Smith said: “The combination of responsible consensus, on-chain governance and institutional grade security makes Tezos a great platform for delivering production-ready solutions.”

Last summer, California’s governor Gavin Newsom signed an executive order to explore more opportunities for integrating blockchain technology within state agencies.

Newsom commented at the time: “California is a global hub of innovation, and we’re setting up the state for success with this emerging technology — spurring responsible innovation, protecting consumers and leveraging this technology for the public good.”