iot - Pwim.Net

Exclusive: Blockchain at the Stage of Tech Convergence

Exclusive interview with Paul Sin: Part 2

How does Deloitte Blockchain Lab envision the future of blockchain? Dr. Paul Sin believes that blockchain is at the stage of technology convergence with IoT, big data and artificial intelligence. He also explained the three challenges for enterprises to implement their own blockchain and various blockchain auditing services offered by Deloitte.

From your experience, what are the pain points for enterprises in implementing their own blockchain?

Since these are enterprise permissioned blockchains, one of the challenges is the commercial model. We need to figure out how these people share the cost of the platform. Going forward, [we need to look at] how they can recover their investments.

The second challenge is regulatory concerns, we need to comply with all the different regulations such as the GDPR in Europe, China’s cybersecurity law, Hong Kong’s PDPO. Liability issues are also a concern. If you are creating a KYC network, for example, if Bank A opens an account for terrorists and Bank B finances the terrorists based on the records from Bank A, who will bear the liability for terrorist financing? This will also be something we will need to sort out. We classify these problems as the governance model.

The third challenge will be the interoperability of the technologies being used by more than 20 platforms on trade finance and supply chain across the world that are in production. You need to exchange data across different distributed ledger technologies, you need to interoperate on Corda, Hyperledger, Ethereum, and also connect the Internet of Things (IoT) with blockchain so that the physical products can be linked to the digital record of the blockchain. You also need to create advanced analytics models that will make use of the data on the blockchain. There is a lot of technology convergence happening at the moment in the market. This is a challenge but also an interesting part of the technology.

Which blockchain-as-a-service (BaaS) platforms are the most popular from your experience working with enterprises, and what are the reasons behind choosing them?

We generally recommend open-source platforms for our clients because it enhances adoption. Even though we deploy blockchain on hybrid cloud infrastructure, we try not to use managed blockchain services unless they are truly open. Some cloud providers have BaaS with open-source technology; those would be the ones we are more comfortable working with. Some blockchain services providing blockchain on a proprietary platform—if one party is on that platform, the whole ecosystem must be using that vendor—those are not recommended. If you see some corporations working with certain well-known vendors who provide proprietary managed blockchain on the cloud, they will have a lot of challenges with adoption. A corporation may find that only they are on the blockchain and no other corporations are willing to join, mostly because the platform is proprietary. This is the reason why it is not attractive from the perspective of supporting the whole ecosystem.

From a corporate perspective, it can certainly save time developing and deploying the technology, so using blockchain managed by the cloud is understandable.

How do you envision the future of blockchain and what is your outlook for enterprise blockchain adoption?

We are now getting to the stage of convergence, as I mentioned earlier, it is now feasible to exchange data with each other without compromising on the authenticity and authorization mechanism. We are also working on technology convergence, where IoT puts data on the blockchain to share among exclusive members, we create a big data pool for the whole ecosystem and we run AI engines on top of that to create insights for analytics. This is what we are working on at the moment.

Other Big Four auditing firms—PwC, KPMG, EY— have launched blockchain auditing services. Does Deloitte have blockchain auditing services currently?

Yes, we have blockchain auditing services. Blockchain auditing is a very confusing term, there are different kinds of blockchain auditing. If a company has certain assets, stored in a crypto format, you will need financial auditing, which is a kind of blockchain auditing. There are also ICOs, STOs, stablecoin issuances, etc., and those need audit firms to audit liquidity, for example. We also conduct IT audits for blockchain platforms, to make sure they are not breaching any technology risks or guidelines, from regulators as well as data privacy auditors.

What are your views on consensus as a service?

I believe this is more for public blockchains because in public blockchains, consensus is very resource-consuming, and it does not make sense to build ASIC server farms in order to create consensus. For permissioned blockchains that we use, the underlying consensus mechanism is very light in terms of power consumption. Many new permissioned blockchains support plug-and-play consensus mechanisms, all of which are open-source, and do not need to do any outsourcing for them.

US FDA Calls Meeting on Blockchain, AI and the New Era of Smarter Food Safety

The U.S. Food and Drug Administration (FDA) will hold a meeting with stakeholders to discuss its plans to usher in “A New Era of Smarter Food Safety .” The meetingwill take place on October 21st, with the aim of gathering input and feedback to help shape an FDA blueprint for the initiative. The FDA will propose leveraging modern technologies such as blockchain, artificial intelligence, and IoT to improve transparency and decrease the risks of contamination in the food supply chain. The initiative is part of an ongoing effort by the FDA to implements the agency’s Food and Safety Modernization Act (FSMA) which was designed to shift the focus from responding to foodborne illness to preventing it. The meeting will include breakout sessions on key topics that include traceability, smarter tools for prevention, evolving business models and retail food safety, and food safety culture.

Food Tech Revolution In a recent interview, Frank Yiannas, Deputy Commissioner for Food Policy, FDA said, “We are in the midst of a new revolution in food technology. There will be more changes in the next 10 years than there have been in the past 20 years. Products will be reformulated; new food sources and production approaches will be realized, and the food system will become increasingly digitalized.”

Before joining the FDA, Yiannis was a champion of blockchain in the private sector and claims he has been “chasing the holy grail of food traceability for years”. He believes that chase is at an end with the emergence of new technologies and specifically blockchain. Yiannis said, “Because of its distributed and decentralized nature that aligns more closely with a decentralized and distributed food system, has enabled food system stakeholders to imagine being able to have full end-to-end traceability. An ability to deliver accurate, real-time information about food, how it’s produced, and how it flows from farm to table is a game-changer for food safety.”

Image via Shutterstock

EOS Dublin and ConsolFreight partner to Leverage Blockchain In FreightTech

EOS Dublin, an EOS block producer and EOSIO blockchain developer, has partnered with ConsolFreight, a leading operator in the digitized Freight Forwarding industry. Together, they have conducted a Proof of Concept (POC) for the freight forwarding industry using blockchain. This development is hailed as the new intersection between Fintech and FreightTech.

Using a number of high-profile clients, the POC will track the transport of goods across international borders with an independent Freight Forwarder providing the trade finance rather than traditional lines of credit offered by banks. Underpinning the process with blockchain allows the transaction to remain secure and low risk through a combination of the Internet of Things (IoT) and smart contracts.

Ernesto Vila, CEO of ConsolFreight, points to the unique low risk presented by this blockchain solution. “In our model, the cargo’s authenticity and value are validated in order to be used as collateral, shifting the lending criteria from the repayment capacity of the buyer to the value of the collateralized asset. This would create financial inclusion to SMEs that wouldn’t be bankable otherwise”

Consol Freight opted to partner with EOS Dublin and use the EOSIO blockchain for a number of key reasons: speed, no-cost transactions, and security. The implementation of this proof-of-concept combines traditional web APIs with modern blockchain smart contracts on the EOSIO blockchain.

Sharif Bouktila, CEO of EOS Dublin, welcomes the opportunity to trial the benefits of the EOS blockchain in a real-world use case. “We are doing some pretty interesting stuff with the EOSIO smart contracts, facilitating the workflow and tracking asset ownership. Using a non-fungible token (NFT) contact we will create, issue, transfer and burn NFTs. These NFTs will be used to track asset ownership throughout the workflow and will also provide escrow functionality for the tokens. Ultimately a smart contract will store the details of the contract thereby issuing pay-outs based on received data. At the end of the day, Freight Forwarders want an easy to use, fail-proof system. We are offering them just that – and at a much-reduced cost.”

The ambitious project has the support of Telefonica, who provided connectivity through Kite, their IoT connectivity platform. It also included the collaboration of key organizations such as Tech Cargo LLC, Freight and Transit Co, the Florida Blockchain Foundation, and Anova Marine, which provided insurance coverage to the transported cargo.

EOS Dublin is Irelands leading blockchain software developer. EOS Dublin is a founding partner of Europechain – a GDPR compliant blockchain platform. Powered by the EOSIO protocol, it is managed and governed by experienced block producers registered in the European Union. Europechain brings together an ecosystem of technology providers, system integrators and commercial partners, enabling global enterprises to deploy scalable, resilient and EU compliant applications.

ConsolFreight was founded in 2016. It is a collaborative platform that uses breakthrough technology such as blockchain and IoT to help improve the logistics and supply chain current processes. ConsolFreight works towards enhancing and better positioning the role of freight forwarders, helping them to grow their business and evolve with the current times. They achieve that by utilizing technology as an enabler in harnessing traditional freight forwarders with solutions that allow them to provide better customer experience, collaborate with others and compete against bigger players in the industry.

Image via Shutterstock

China’s Cryptography Law Piques Local Interest and Stirs Global Market Reaction

On Saturday, Oct 26th, China’s top legislature voted to pass a national cryptography law that will come into effect on January 1st, 2020. The vote was passed just one day after Chinese President Xi Jinping stressed the necessity for China to leverage blockchain technology. According to an announcement from the National People’s Congress (NPC) Constitution and Law Committee, the new law will encourage research and development on commercial cryptography technologies, while building up an inclusive standardized regulatory system for the market. The new regulatory framework aims to tackle emerging legal challenges in commercial cryptography applications as well as to establish the role of a central cryptographic agency—to lead public cryptographic work as well as create guidelines and policies for the industry.The cryptography law outlined in the latest draft proposal classifies cryptography into core, common and commercial cryptography which will be strictly managed by state authorities to protect China’s confidential information and state secrets. The law stipulates that the transmission, storage, and disposal of such information must use core and common cryptography for encrypted protection and security certification. For commercial cryptography, it excludes confidential information of the Chinese government and this category applies to citizens and legal entities.Furthermore, the cryptography law also encourages the cultivation of talents in cryptography, and proposes the inclusion of cybersecurity modules to national education and the training curriculum of civil servants in China. For local governments at or above the county level, they should include cryptography work in their Five-year plan for National Economic and Social Development, and incorporate associated expenses in their current fiscal budget.

The new law also features a section on legal liability related to misconduct ranging from punishments for outright theft and cyberattacks of encrypted information to harsh penalties for those who become aware of security threats or points of failure within the national encryption process and fail to act in the nation’s best interest. Blockchain Search Trends on WeChatThe nationally adopted Chinese social app—WeChat, has recorded an immense increase in blockchain-related search topics on its platform. Prior to President Xi Jinping’s initial urge for his country to leverage blockchain, the word “blockchain” was searched for less than 800,000 times, and Bitcoin was searched for less than 600,000 times. On October 25th, the day of the Chinese president’s announcement, there were 9.2 million searches for “Blockchain” and 1.3 million for “Bitcoin.”

Although China still bans cryptocurrency trading and its national digital currency is not yet hatched, Xi Jinping initial announcement on the 25th also seems to have lit a fire within the global cryptocurrency and blockchain industry. Shortly afterward, all cryptocurrencies appeared to find new life against the recent market downturn and in majority have rallied to double-digit percentage price increases.

Image via Shutterstock

ConsolFreight Releases New Proof Of Concept To Advance The Role Of Logistics Providers In Trade Finance

ConsolFreight released its new Proof of Concept report “Trade Forward” at the IoT Solutions World Congress in Barcelona. The ambitious project has the support of Telefonica, who provided connectivity through Kite, their IoT connectivity platform.

It also included the collaboration of key organizations such as EOS Dublin using EOSIO blockchain technology, the Florida Blockchain Foundation, and Anova Marine, which provided insurance coverage to the transported cargo.

The Proof of Concept aims to provide liquidity, create new revenue streams, and ultimately advance the role of freight forwarders in the Supply Chain. Trade Forward is a new business model of collaboration amongst insurance companies, financial institutions, and logistics providers.

This model, where the freight forwarders are the centerpiece, brings the following benefits:

● SMEs financial inclusion

● Full oversight of trade asset movement

● Streamline data exchange between the multiple parties

● Risk mitigation and redistribution along the Supply Chain

● Optimized operational liquidity for exporters and importers

● Decreased paperwork and institutional bureaucracy

“Banks are short-sighted in determining and validating the value of the goods being financed. They have drawn a very distinctive line between Logistics and Financial institutions, where the value of the assets is entirely disconnected from the process. Thus, leaving an untapped market of unfulfilled credit demand estimated at $1.6 trillion,” says ConsolFreight’s CEO, Ernesto Vila.

This revolutionary test was carried out by a dedicated team of experts in blockchain, logistics, supply chain management, and finance. Members of the ConsolFreight ecosystem are conducting pilots along with companies like Telefonica and Anova Marine. These partnerships are allowing smaller players to get access to larger organization solutions, generating technological inclusion.

The first TradeForward shipment was handled by freight forwarder Tech Cargo in the region of North America. The following shipments will be carried out by Freight and Transit Co. LTD to enable non-traditional trade finance in the African continent. Additional pilots in LATAM will be carried out by ADEKO Enterprises S.A., Globalog S.A., and Tree Logistics.

Image via Shutterstock

How Can Blockchain Be Used to Save $31 Billion in Costs in the Food Industry?

Blockchain, along with the internet of things (IoT) trackers and sensors, could reduce costs for retailers. New data from Juniper research showed that blockchain will be essential to $31 billion in “food fraud savings” by 2024 by tracking food across the supply chain.

In the “Blockchain: Key Vertical Opportunities, Trends & Challenges 2019-2030″ report, the research showed that through the streamlining of supply chains, efficient food recall processes and regulatory compliance would help drive down the costs.

Juniper Research said in a statement that the internet of things and blockchain would add “significant value” to those involved in the supply chain, including farmers, retailers, and consumers.

Morgane Kimmich, the research author said: “Today, transparency and efficiency in the food supply chain are limited by opaque data forcing each company to rely on intermediaries and paper-based records.”

“Blockchain and the IoT provide an immutable, shared platform for all actors in the supply chain to track and trace assets; saving time, resources and reducing fraud,” explained Kimmich.

The leading players in the food provenance space using blockchain and IoT solutions include IBM’s Food Trust, SAP’s Track and Trace, Oracle’s Track and Trace and IoT solutions.

Consumers today are more aware of where their food comes from and where it was sourced or produced. Trust has been a big issue when it comes to supply chains.

Image via Shutterstock

How Can Blockchain in IoT Market Grow 180 times by 2026?

How Blockchain in IoT is Transforming the Modern World

The combination of Internet of Things (IoT) and blockchain has appeared to be one of the most exhilarating use cases for the modern era of technology. New opportunities are opened up by adopting IoT-based technologies in various aspects of our daily lives, such as manufacturing, intelligent transportation, and home automation. With the evolution of embedded network and computing hardware technology, the combination of blockchain in IoT technologies makes the large-scale autonomous systems of IoT to come into being. Two big companies, Bosch and Volkswagen believe that the IoT market places and the decentralized data should co-exist.

Before understanding how the combination of IoT and blockchain can bring change to the world, let us first find out what is blockchain and what is IoT.

What is Blockchain?

Based on the concept of a decentralized network, the blockchain technology processes and records transactions securely and transparently. Blockchain is a chain of blocks that comprehend the digital records, which cannot be deleted or altered when added to the blockchain. These saved records are distributed across all the nodes in the network. Every node contains an updated copy of the ledger at all times.

When it comes to saving data or processing payments, every technology company whether it is Uber or Airbnb pretends as a centralized entity. Based on decentralization concepts, blockchain protects the data from a few centralized bodies, which reduces the risk of information hacking or theft.

What is IoT?

A smartphone is the best example to better understand the basics of IoT. Today, a smartphone is the most essential device used for many of our needs from playing games, listening to music, watching movies, communicating with peers, checking messages or emails.

However, the phone did not have all these capabilities a few years ago. People could only make a call or send a message on their mobile phones.

The advent of internet facilitates the connection between mobile phones in file sharing and data transfer. This is the basic principle of IoT that the devices or objects become “smarter” when connected to the internet. There are 3 categories of IoT devices:

Things that act based on the data received

For example, smart TVs, wearable devices, and 3D printers take action after collecting data from the sensors.

Things that transmit information based on data collected

For example, light sensors, moisture sensors, and motion sensors, moisture sensors send relevant data for improved decision-making.

Things that fulfill both functionalities

To find the amount of water needed by the crops, the sensors of IoT based farming gather information about soil moisture. Therefore, it is crucial to protect the information throughout its lifecycle as the efficiency of IoT relies on the information existed in the system.

Why IoT needs Blockchain?

The dependency of IoT on centralized communication in order to interact with the system is its biggest drawback of IoT. All the devices in IoT setup are recognized, linked and authorized via centralized cloud servers. However, networking equipment and centralized clouds used in the present IoT solutions have high infrastructure and maintenance costs. As IoT systems are associated with these service areas, scalability can become a critical issue.

As the sum of IoT devices surges, the cost for the number of interactions between the devices also increases. This is a major reason for large IoT networks don’t get support from the current systems.

Cloud servers are helpless to a single point of failure. This means that the entire ecosystem can be affected at a certain point. As revealed by Microsoft’s survey, 97% of respondents are concerned about the security of IoT devices and infrastructure, which partly explained that 30% of IoT projects failed in the Proof-of-Concept stage. Therefore, instead of using a server/client model, making use of a peer-to-peer model instead can be a precise solution that the IoT industry needs.

With decentralization in place, computation and storage needs can be distributed across millions of IoT devices. Therefore, the use of blockchain in IoT can benefit the IoT devices to scale up proficiently.

How can Blockchain Help in IoT?

As the blockchain is decentralized and tamper-proof, it can do what IoT precisely requires. Billions of connected devices can be tracked in the network by using blockchain IoT. With the increased integration between IoT devices and blockchain across industries, the global blockchain IoT market is estimated to grow exponentially and is forecasted to a market size of $5.8 billion by 2026, compared to 32 million in 2018.

Integrating the blockchain in IoT devices can also lower the costs of managing and installing servers for an IoT network. The cryptographic algorithms are used by blockchain to ensure the security and confidentiality of the data existing on the IoT network. As blockchain IoT does not have a single thread of communication, it also protects the network from the man-in-middle attacks.

Here are some of the exciting use cases of Blockchain IoT:

· Supply Chain & Logistics

When blockchain is combined with IoT, the traceability of the supply chain network can be improved. IoT sensors like GPS, motion sensors, or temperature sensors connected to the vehicles provide the info of shipment status. Blockchain stores the data, when it is fetched from the sensors. This brings transparency, auditability, and traceability in the system.

· Smart Homes

IoT devices play a major role in allowing smartphones to control the home security system. However, the centralized model of IoT that exchanges information generated by IoT sensors lack security standards and ownership of data. When the gathered data is moved from IoT devices to the blockchain it can solve many security issues.

· Parking Solutions

NetObjex company has come up with an idea of a smart parking solution with blockchain IoT. IoT sensors are used in the smart parking technology by which, the car drivers can automatically with crypto wallets and can also find the empty parking space easily. There are several industries who have now started to experiment with the potential of blockchain IoT networks.

Image via Shutterstock

China to Dominate Global Tech Standards? Expert says “It Would be Tough”

China announced a new 15-year blueprint as part of the country’s global technology push, to set the global standards for the next-generation of technologies, including blockchain.

China Standards 2035, the ambitious plan by Beijing is expected to be released this year, as standards have been crucial for emerging technologies. Technologies such as 4G mobile networks and Wi-Fi follow specific technical standards, such as enabling the use of mobile networks abroad.

US and European companies have dominated the development of standards; therefore, Beijing is pushing its domestic firms and experts to become part of the global team to set standards for emerging technologies.

China Standards 2035 is part of an “ambition to set the rules for the future world, especially the technological rules as we enter into a new technological era,” said Emily de La Bruyere, co-founder of consultancy firm Horizon Advisory. “China Standards 2035 is an industrial plan that operationalizes this strategy.”

The Lagou Institute of Big Data Research found that there has been a massive surge in demand for new technology talent; however, there will be a considerable gap between positions needed and suitable talent. In March 2020, the institute reported that 86% of the positions in the industry were filled by suitable candidates; however, in the coming years, only 56% of the positions will be filled by talents with relevant backgrounds. The institute further estimated that the core technology talent gap would reach 4.2 million in China by the end of 2020.

Six major industries related to new infrastructure core technologies include 5G, big data, artificial intelligence, blockchain, the Internet of Things (IoT), and cloud computing will see the most growth in demand. After the Lunar New Year festival in China in February, the demand for tech talents has surged to 32%, compared to an 8% increase seen in the year 2019. The demand for blockchain-related talents rose to the top in the technology sector — 67%, compared to the other five major industries related to new infrastructure.

Beidou: Rivaling the US GPS

Along with Beijing’s new plan, China is expected to send the last satellite to space that would complete a global navigation network, rivaling the US global positioning system (GPS). China’s network, Beidou, consists of 30 satellites used for navigation and messaging. This network is completely independent of the US GPS system; given that there is a fear of a major conflict between the US and China, the GPS system could be cut off from the Chinese. Christopher Newman, professor of space law and policy at Northumbria University commented:

“The most profound impact is that it is now independent. It (China) has now got a system that is resilient and can be used in times of conflict.”

All hype and no game?

However, China’s attempt for its plans may not be at all that it is being hyped up to be, said Naomi Wilson, senior director of policy for Asia at the Information Technology Industry Council (ITI).

“China will likely play an increasingly important role as their companies develop. The standards process and standards development doesn’t operate in a vacuum and it’s not the be all end all of the technological competitiveness either. It’s one stage in the process. It’s an important stage, but it’s not an opportunity to sort of carte blanche rewrite the rules for technology’s future.”

Wilson explained that since standards are set by industry bodies, many companies and experts will come together to come up with them, and the process may be tough for China to come and dominate the system.

Tencent to 500 billion yuan in blockchain and new technology infrastructure

Chinese tech giant Tencent Holdings, the owner of China’s messaging platform WeChat has announced that the company will be investing 500 billion yuan ($70 billion) in the next five years in emerging technologies including blockchain, artificial intelligence (AI), cloud computing, and cybersecurity.

Tencent is aiming to strengthen the development of FinTech in China, following the push of accelerating the development of blockchain, as stated by the country’s President Xi Jinping.

MasterCard Asia Files Device Billing System Patent Compatible With Iota’s Tangle Network

MasterCard Asia has filed a patent for a device billing system that aims to help shared device users and merchants avoid fees associated with legacy payment systems of maker spaces. The patent file specifically mentions compatibility with Iota’s (MIOTA) Tangle distributed network.

MasterCard Asia, the payment giant’s Singapore-based subsidiary recently filed a patent with the US Patent Office for a payment system for shared hardware devices that aims to eliminate unnecessary fees for users and merchants.

As outlined by the patent published on Aug 20, the billing system is a proposal for a pay-as-you-go system based on the Tangle network. Citing copiers and 3D printers as examples—the paten outlines that using the system merchants and users only have to provide their credentials to access a hardware device and through transparent “data storage and aggregation” the user is billed only for what they have used.

The patent states that legacy systems and traditional payment methods often leave users of “maker spaces”—businesses that operate by making uncommon or expensive hardware available—being forced to pay a flat membership fee despite their intended use. Additionally, typical forms of pay-per-use schemes often only accept “physical currency to operate” and pre-paid services also lock users into standard amounts that they may not necessarily need.

MasterCard’s proposed billing system concept would create a higher degree of transparency and trust, as well as the ability to monitor usage in real-time while eliminating associated extra fees of credit cards and traditional payment systems.

According to the patent, the proposed data storage systems are compatible with the Tangle network but could be used by a generic blockchain—the filing makes no direct mention of Iota network or, Miota token. However, as the transactions are recorded on distributed ledger technology (DLT) it is likely that some cryptocurrency or tokens will be leveraged.

MasterCard’s Crypto Mission

Mastercard has committed to applying its innovation, experience, and scale to emerging cryptocurrency and digital currency partners, building global ecosystems to modernize payments and transform the way people and businesses transact.

As reported by Blockchain.News in July, MasterCard recently granted Wirex a principal licensing membership, making it the first native cryptocurrency platform to allowed to directly issue payment cards.

According to recent research from Statista, consumer interest and investment in digital currencies are growing, with data showing that up to 20 percent of the population of some countries are holding cryptocurrencies, and an increasing number of merchants, digital players, and financial institutions are exploring crypto payments.

“The cryptocurrency market continues to mature, and Mastercard is driving it forward, creating safe and secure experiences from consumers and businesses in today’s digital economy,” said Raj Dhamodharan, Executive Vice President, Digital Assets and Blockchain Partnerships, Mastercard. “Our work with Wirex and the wider crypto ecosystem is accelerating innovation and empowering consumers with more choice in the way they pay.”

Can Blockchain Strengthen the Internet of Things (IoT)?

The Internet of Things and Blockchain are two disruptive technologies that we have leveraged for numerous technological innovations across multiple industries and niches. But have you ever thought about the impact that one of these technologies might pose over others?

Well, that’s an intriguing question to find an answer to, right!

With this blog, I intend to answer if or not Blockchain strengthens the Internet of Things.

Let’s first get a basic overview of what is IoT?

The Internet of Things (IoT) connects products with people and places. While doing so, it assists in offering opportunities for capturing and creating values.

You might wonder how these interconnections work?

Sophisticated and specifically-designed sensors, chips, and actuators are embedded into physical items, which then continuously transmit data to the IoT network. Now, the IoT system’s analytics capabilities leverage the data collected to convert the insights into action. These collecting and exchanging data have introduced the concept of devices and appliances being ‘Smart.’

What are the standard Internet of Things (IoT) Applications?

Wearables
Smart TV
Smart Home
Smart Car
Smart Farming
Smart Health
Smart City
Smart Appliances

Now, when you’re aware of how exactly IoT performs its actions, we must discuss how Blockchain may strengthen IoT and its adoption in our daily lives.

Blockchain & IoT

As you all might know, Blockchain, at its core, is a cryptographically secured, distributed ledger, which enables the secure transfer of data between parties.

And, as you might have already guessed, all the conventional IoT-based systems are dependent on a centralized architecture. All the data collected from the devices connected to the IoT system is processed using analytics and is then sent back to the IoT devices.

With an increasing number of devices connected to an IoT network (this number is expected to be in billions), such a centralized system might fail in offering the required scalability, putting the whole system at risk.

Incompetency of the IoT network to handle the data and connections might compromise network security and grow exponentially expensive over time. Also, if there would exist a constant need to perform checks on the network for authenticity and security, the system might become slow.

Vulnerabilities of the Internet of Things

Based on the above discussion, we can conclude that increasing IoT networks’ adoption might lead to potential concerns in its security and scalability.

The constant threat of IoT devices suffering from security vulnerabilities makes them an easy target for DDoS attacks, Distributed Denial of Service. These unsecured IoT networks might also become an easy target for cyber-criminals, who can swiftly exploit the weak security to hack and launch DDoS attacks.

There have been many DDoS attacks in the past, causing unrest within organizations and individuals. (Let me know in the comment section if you’ve heard about any such DDoS attacks on IoT networks!)

According to Gartner’s forecast, Internet of Things endpoints are going to grow at a compound annual rate of 32%, and by 2021 the number of base units is to touch the 25.1 billion mark. As the number of devices connected via an IoT system grows, scalability emerges as another issue to contemplate.

How can Blockchain address the vulnerabilities of IoT networks?

Blockchain technology can effectively be introduced and embedded within the IoT’s core network to alleviate the scalability and security concerns.

Let’s find out how?

Bringing transparency to the system. Blockchain will only allow the network’s access to authorized personnel to check the previous transactions performed in the network. Such clarity in transactions will establish a reliable method to identify the sources of any data leakages and perform prompt corrective action.
Blockchain, with its distributed ledger, is tamper-proof. It literally can’t be manipulated by any directly concerned or third parties. Hence, when no one holds control over the devices’ data, the trust in the IoT network can be intact.
Adding a robust level of encryption. When storing the generated and collected data of an IoT network on Blockchain, we might end up adding an additional layer of security to it. The top-notch level of encryption presented by Blockchain makes it virtually impossible by any means to overwrite or manipulate the existing data. This will even minimize the attempts made by hackers to use the data.
In a blockchain-backed IoT system, we can easily enable quick processing of transactions and establish coordination among billions of connected devices. As the interconnected devices in the IoT network increases, the transparent distributed ledger technology offers a viable solution to support the processing of a considerable number of transactions.
These technologies together can also reduce the costs for stakeholders by eliminating the processing overheads. Moreover, by being transparent and tamper-proof, Blockchain backed IoT systems will enable trust among the users.
Not to forget, the most talked-about innovations ‘smart contracts’, which is an agreement between two parties stored in the Blockchain, can also enable the secure execution of contractual agreements. These smart contracts can be based on specific criteria. For example, if the pre-decided conditions are fulfilled for a transaction, smart contracts can automatically authorize the payments without any human intervention.

What makes Blockchain so compelling for IoT networks?

Blockchain brings standardization, authentication, and trust across all elements of IoT. Below are ways how it solves multiple trust and security-based issues on any IoT network:

Blockchain can effectively track the sensor data measurements and restrict any sort of duplication with any other malicious data.
Deploying an IoT device might be intricate, Blockchain, with its distributed ledger, makes the data transfer process seamless.
With a trusted distributed ledger, Blockchain eliminates the need to reach a third party to establish trust. IoT sensors can effectively exchange data through Blockchain.
Eliminating the single source of failure, a distributed ledger protects the data within IoT devices from any sort of tampering.
Blockchain has been long known and appreciated for eliminating technical bottlenecks and inefficiencies to enable device autonomy, data integrity, and peer-to-peer communication.
With no intermediary present in the system, IoT’s operation and deployment costs can be reduced through blockchains introduction in the IoT network.

Wrapping it Up

With all the above analysis, you might have well-understood how Blockchain can strengthen IoT devices and its network.

Blockchain-based IoT Solutions are well-suited for simplifying business methods, realizing significant cost efficiencies, and customer experiences.

Does your IoT device leverage blockchain distribute ledgers? If not! What are you waiting for! With the growing realization of its abilities, Blockchain in Australia has the potential to transform the businesses operating in the IoT niche.

I would love to read your thoughts and experiences around the same. Let’s steer a conversation around it!

About the Author:

Ralph Kalsi is an entrepreneur, blockchain enthusiast, and consultant who collaborates with businesses in Australia. With his vast knowledge and industry experience, he helps to drive sustainable business growth. He is the proud founder of Blockchain Australia Solution.