How Blockchain Can Accelerate IoT Adoption?

Key takeaways

• The Internet of Things (IoT) has recently gained massive popularity.
• Unlike conventional databases, which have only one central point of authority, a DLT lacks a single point of control or failure.
• Moreover, the integration of blockchain with IoT creates a large number of benefits that can be realized in terms of security.

The Internet of Things (IoT) has recently gained massive popularity. Technology is also making a significant impact on the world by connecting a wide range of devices and machines for the benefit of humans. In addition, the advent of IoT has streamlined our lives, and the way business is done. With the help of IoT, businesses are reaping multiple benefits in the form of informed decisions, easier access to information, higher productivity, and decreased operational costs.

However, as with any other cutting-edge technology, some challenges associated with IoT need to be addressed before we can think about ultimately leveraging this technology. Security is among the major challenges as all devices communicate through data centers, which are prone to cybercrime. A new trend known as Blockchain-IoT integration is emerging in the market to effectively manage security challenges linked with IoT networks.

What Is Blockchain With IoT? #

Blockchain with IoT is an emerging trend wherein the two technologies are used together to achieve a common objective. If they work individually, we know both blockchain and IoT are extremely effective. However, their integration can provide a lot more benefits than working alone. The following segments will analyze how these two technologies work separately.

How Does Blockchain Works? #

The term blockchain means an immutable digital ledger that enables transactions between two parties without the need for any trust between them. Blockchain stores transactions on a shared public database which enables users who don’t know each other – for instance, tenants and landlords – to make business transactions securely with the help of cryptography.

How Does IoT Works? #

IoT technology can connect everyday devices like sensors or appliances so they can effectively communicate over the internet without the need for any interaction. A seamless connection between these devices would enable new ways of interaction with them. For instance, you could utilize your smart fridge’s built-in camera for video conferencing with other people using Skype or Facebook Messenger.

How Can Blockchain Overcome the Scalability and Security Issues With IoT? #

Blockchain refers to distributed ledger technology (DLT). This implies it is developed on a network of connected devices (nodes) that saves the same copy of the blockchain’s transactions. Unlike conventional databases, which have only one central point of authority, a DLT lacks a single point of control or failure. Instead, it depends on consensus from every party involved to validate transactions and develop new blocks for the chain.

With the help of immutable records of transactions – that include data from IoT sensors – blockchain will assist in forging trust between various organizations or individuals who do not essentially trust each other but do need to share data with each other without exposing their security and privacy vulnerabilities.

Latest Blockchain-IoT Use Cases #

There are several ways in which IoT devices can help boost the adoption of blockchain technology. In fact, there are not just prominent players and companies that are willing to do this; smaller corporations are also looking at ways in which their products can be used with blockchain technology.

In fact, some of them have already developed unique solutions that leverage both technologies in new ways:

• Microsoft formed a partnership with ConsenSys and Chronicled to leverage Azure BaaS (Blockchain as a Service) platform to develop enterprise-grade applications on Ethereum. Following this, organizations will be able to create smart contracts with the help of Ethereum-based protocols and implement them onto private blockchain built using Azure’s enterprise version of Hyperledger Fabric.
• IBM came into a partnership with Samsung SDS Co Ltd., NTT DOCOMO Inc., Sony Interactive Entertainment LLC, and other global companies on an initiative called ADEPT (Autonomous Decentralized Peer-to-Peer Telemetry). Following this initiative, IBM would drive up efficiency by allowing real-time data exchanges between IoT sensors, devices, and clouds through a peer-to-peer network structure based on blockchain technology.

Future of Blockchain-IoT Adoption #

The term “Blockchain” has got various meanings depending on who you ask. Generally, it refers to any type of shared ledger or database which records transactions securely and is later verified by every person who tries to access them. The technology was first utilized in 2009 with Bitcoin, which brought digital currency into the mainstream and was not supported by banks or governments but rather monitored and verified across a network of users’ computers.

In the last few years, however, blockchain has transformed beyond just monitoring currency. The technology is now being implemented across several industries such as healthcare (medical records), energy trading (transactive grid), logistics (supply chain management), real estate recording systems, and others. By allowing effective sharing between different participants throughout their supply chains while simultaneously keeping data integrity intact across various stakeholders involved in those transactions because of its immutable nature, blockchain provides a lot of benefits, such as increased transparency within organizations. This is due to the elimination of intermediaries from specific business functions and decreasing fraud rates through higher accountability among parties involved with transactions.

Final Thoughts #

This article explored why Blockchain technology can work perfectly well in conjunction with IoT and how the two technologies can support each other to fuel adoption across industries. However, some challenges still need to be addressed before Blockchain-IoT ecosystems become mainstream.

Blockchain and IoT are two cutting-edge technologies transforming the way we do business today, enabling higher trust between people and machines, paving the way for new business models, and creating an unparalleled level of transparency in manufacturing processes.

The next few years will bring more clarity about how blockchain and IoT can work in tandem to make our networks more secure. The advantages of these two technologies are clear, and I believe they will be a crucial part of the future of internetworking. Moreover, the integration of blockchain with IoT creates a large number of benefits that can be realized in terms of security.

Related reading

• The Truth about Cryptocurrency and Blockchain Adoption Technologies
• 5 Major Blockchain Impact on Telecom Industry: Blockchain Use Cases
• Blockchain For Business - An Insight

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Questions and answers

What Is Blockchain With IoT? #

Blockchain with IoT is an emerging trend wherein the two technologies are used together to achieve a common objective. If they work individually, we know both blockchain and IoT are extremely effective.

How Does Blockchain Works? #

The term blockchain means an immutable digital ledger that enables transactions between two parties without the need for any trust between them.

How Does IoT Works? #

IoT technology can connect everyday devices like sensors or appliances so they can effectively communicate over the internet without the need for any interaction. A seamless connection between these devices would enable new ways of interaction with them.

How Can Blockchain Overcome the Scalability and Security Issues With IoT? #

Blockchain refers to distributed ledger technology (DLT). This implies it is developed on a network of connected devices (nodes) that saves the same copy of the blockchain’s transactions.