Impact of Next-Gen Block chains On The Adoption of IoT
What is IoT ?
The Internet of Things (IoT)(source) refers to internet-connected devices or objects that are capable of exchanging data and instructions over a wireless internet network.
The fundamentals of IoT include modern computers, smart speakers, smart watches, smart homes and smartphones. Along with increasing modernization, the use cases of IoT devices are expanding in all fields.
What is Block chain ?
A blockchain(source) is a digital record of transactions. The name comes from the structure of the database. Here the which individual records, known as blocks, are linked together in a single list known as a chain.
Blockchains are used to record transactions involving cryptocurrencies(source) such as Bitcoin and have a variety of other applications.
Each Bitcoin is a computer file that is stored on a smartphone or computer in a ‘digital wallet’ app. People can send Bitcoins to our digital wallet, and we can also send Bitcoins to others. Every transaction is recorded in a public ledger known as the block chain.
IoT technology can be used to improve people’s lives in a variety of ways.
IoT devices, for example, are used in the healthcare system, cryptocurrency mining, machine learning technology, gaming, manufacturing, trading, and a variety of other applications.
Despite rapid advancements in IoT technology in today’s world, there are some significant challenges that IoT is currently facing.
Challenges of IoT
- Security and Privacy
- Consumer Precption
If so many IoT devices with security flaws are linked to the central servers, hackers can easily exploit the weakest security layers to launch DDoS attacks(source : Wikipedia), forcing users to lose their highly sensitive data.
Scalability is another well-known issue for IoT technology in centralised systems. If there are a large number of nodes connected to the central server, it must exchange a large amount of information and data to all connected IoT devices, causing an overload on the central server to fail.
As a result, massive resources and investments are required to manage central servers; otherwise, if the central server goes down, all IoT devices (which are connected to the central server) will be affected.
There are five generations of block chain technology, and block chains from the first three generations were able to solve the most discussed security, privacy, and scalability (to some extent) challenges.
- The distributed architecture of blockchain technology can be very effective in tracking, storing, and monitoring sensor data in decentralised internet connectivity by preventing duplicate data.
- Different sensors on IoT devices can communicate with the blockchain to exchange data and information, thereby eliminating the trust issue that existed with the centralised system.
- DLT is the best option for IoT device authentications, record keeping, and device identification because it securely transfers data and is transparent in a decentralised system.
- There will be no single point of failure in the blockchain, unlike the centralised system’s server failure.
These are some applications of blockchains from the first three generations, but they were insufficient to address the major challenges of IoT technology that are impeding large-scale adoption due to the limitations of the blockchains from the previous three generations:
- Blockchains are computationally very expensive, with high bandwidth overhead and latency, making them unsuitable for IoT devices and applications.
- Although low latency is expected for many IoT devices, these blockchain networks are PoW-based and require time to mine the blocks.
- Low scalability is a well-known issue with these PoW-based blockchain networks, and it has caused problems for IoT networks that contain a cluster of nodes.
Objectives of Block chain Technology in IoT
The introduction of Blockchain technology has resulted in numerous benefits across a wide range of industries in trustless environments. several advantages and goals of Blockchain in IoT are discussed below:
- Decentralization : Because of its decentralised nature, blockchain is a promising technique for effectively solving bottleneck and one-point failure problems in IoT networks by eliminating the need for a trusted third party.
- Enhanced Security : In several ways, blockchain is more reliable and secure than other record-keeping systems.
- Improved Traceability : In other systems, goods traded in a complex supply chain using a traditional ledger cannot be traced back to their point of origin as quickly as in Blockchain.
- Greater Transparency : Transaction histories in Blockchain are more transparent because they are accessible to all network users.
- Data Privacy : Because of Blockchain’s immutability and trustworthiness, storage systems on the Blockchain are extremely effective at protecting IoT data from tampering.
- Reduced Cost : One of the primary goals of many businesses is to reduce costs. Blockchain eliminates the need for third-party costs for public BC to ensure business operations, which can lower the cost of doing business.
Blockchain in IoT : Real world Applications
Supply Chain and Logistics
A supply chain network involves many stakeholders, which is why delivery delays are one of the most difficult challenges in the supply chain and logistics industry. This is where Blockchain and IoT come into play.
While IoT-enabled devices will allow businesses to track shipment movement at every stage, Blockchain will provide complete transparency to the transaction. IoT sensors such as motion sensors, GPS, temperature sensors, vehicle information etc. can provide information about the shipment status.
This data is then stored in the Blockchain network for transparency – once the data is recorded on the Blockchain network, all supply chain stakeholders listed in the Smart Contracts have real-time access to the information.
Blockchain and IoT could really work together to improve the supply chain network’s :
- reliability and
Digitization has swept through every industry sector, including the automotive industry. Automobile manufacturers are now utilising IoT-enabled sensors to create fully automated vehicles. The automotive industry is increasingly interested in combining IoT-enabled vehicles with Blockchain technology to enable multiple users to exchange critical information easily and quickly.
Furthermore, the industry is quickly implementing Blockchain IoT use cases that have the potential to improve :
- autonomous vehicles
- smart parking
- automated traffic control.
NetObjex (source : NetObjex official website) exemplifies this point by developing a smart parking solution that combines Blockchain and IoT. It has collaborated with PNI, a parking sensor company, to detect vehicles in real time and locate potential parking spots in the parking area. The integration also automates payments made with cryptocurrency wallets.
Smart Home Industry
Exchanging information generated by IoT devices in the traditional centralised approach lacks security standards and data ownership. Thanks to Blockchain IoT, homeowners can manage their home security system from their smartphone remotely. Blockchain has the potential to improve Smart Home security by removing the constraints of centralised infrastructure.
Telstra (source), an Australian telecommunications and media company, for example, offers smart home solutions. To ensure that no one can tamper with the data captured by smart devices, the company has implemented Blockchain and biometric security. When data is saved on the Blockchain, only the authorised person or persons have access to it.
The combination of advanced and next-generation blockchain technologies with the IoT sector has enormous potential and applications for creating a global marketplace. Blockchain technology can meet the needs of a broader range of IoT applications, such as smart cities, healthcare systems, identity management, voting, smart homes, and many others. By overcoming numerous challenges, blockchain technology can aid in the widespread adoption of IoT.
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