In the past ten years, the Internet of Things and cryptocurrencies have grown significantly, and exciting new IoT development has occurred in both areas. Cryptocurrencies may become more important in IoT installations as the range of IoT applications grows, and more organizations decide to exchange data.
Most current Internet of Things (IoT) use cases involve single-user or small-scale sensor deployments. Take, as an illustration, the use of an Internet of Things system to monitor the whereabouts of a fleet of vehicles. The fleet owner may be the only person who uses the design and the data it generates. However, as these systems grow in complexity, for example, in IoT-enabled smart cities, we will increasingly encounter situations where another can potentially absorb the data produced by one entity.
For instance, an app that helps city residents discover parking spots in any part of town would benefit from data provided by a private parking lot owner. Similarly, a camera installed by one company for security purposes may be of service to a different company for traffic analysis or store analytics. The owner of the IoT device may be amenable to sharing data in exchange for small payments from the other party. Cryptocurrencies could be an appealing enabler for such micropayments for IoT data since they are a digital, frictionless form of cash that can be coupled with smart contracts to automate the payment process. If you want to develop IoT Software, you can get in touch with an IoT Development Company in Dubai.
Similarly, IoT system deployers can automate payments for edge computing resources owned by third parties if they accept cryptocurrencies as payment. Expert reviewers for real-time IoT data products on decentralized data marketplaces might be compensated in cryptocurrency, giving businesses another way to employ digital currency. As a result, consumers of IoT data would be better able to avoid purchasing inaccurate information.
Coins can be used to incentivize the development of a distributed wireless network architecture that allows IoT devices to transfer data securely and cheaply. In addition to providing low-power WiFi hotspots for IoT applications, users in these communities may also mine a native coin. Token-based incentives for assisting with the deployment and maintenance of base stations on a decentralized 5G wireless network are being offered by other market participants.
Challenges to Secure IoT Devices
The usage of cryptocurrencies for micropayments of IoT data and other IoT use cases faces numerous obstacles. One is that the transaction throughputs of existing blockchain technologies need to be increased. This may result in large transaction fees, especially during strong demand. As a result, it becomes unfeasible to conduct transactions of low value. No one would use a protocol that charges more than $1 to send a few pennies.
As protocols enhance their throughput performance using methods like sharding, which permits the concurrent processing of transactions on a blockchain, this may become moot. Layer 2 scaling techniques used within a blockchain could increase throughputs and make low-fee micropayments conceivable. However, these technological methods to boost blockchain throughput require more development time.
Another major challenge is ensuring the blockchain platforms that support Bitcoin payments don’t negatively impact the environment. Bitcoin’s original protocol, like many others, featured a proof-of-work technique that consumes a lot of power. Energy consumption for proof-of-work blockchains has been estimated to be on par with that of a small country. Fortunately, a greener, more sustainable alternative to proof of work known as proof of stake is quickly gaining popularity. It is predicted that Ethereum’s recent conversion to proof of stake has decreased its energy consumption by four orders of magnitude, or more than 10,000 times. Because of this, we don’t have to worry that blockchain systems used to facilitate micropayments for IoT data and other use cases won’t be kind to the planet.
Another issue is that cryptocurrencies use their own distinct peer-to-peer blockchain protocols. Still, most IoT data is transmitted straight from a sensor to a data consumer using classic TCP- or User Datagram Protocol-based transport protocols over the internet. A revolutionary application-layer protocol for IoT data payments is the Streaming Data Payment Protocol (SDPP), which allows cryptocurrency payments to be processed in a manner compatible with IoT data protocols. SDPP provides a uniform and flexible framework for combining a standard TCP/IP data channel with a cryptocurrency payment channel to avoid recreating the wheel for each application. However, practical implementations of such a hybrid protocol have yet to leap from the research phase.
Interactions between Internet of Things devices and blockchain technologies go far beyond monetary transactions. Both academic institutions and commercial enterprises are investigating these. Private blockchain systems that aim to improve consumer IoT device security, permissioned blockchain platforms for the container logistics industry, and projects that have investigated the use of blockchain technology and radio devices to enable authenticated proof of location for IoT devices are just a few examples. To authenticate transactions on blockchains, even low-powered mobile and IoT devices, we at the University of Southern California have devised Blizzard. Furthermore, we have created Trinity, which helps decentralize publish-subscribe protocols for the Internet of Things by leveraging blockchain consensus. Trinity aids IoT protocols like MQTT in decreasing the likelihood of centralized data censoring or meddling. Connected devices and digital currencies can complement one another.
Cryptocurrencies may positively impact the IoT by facilitating low-friction micropayments for data and edge computation and offering incentives for infrastructure deployment and product ratings in IoT data marketplaces. Even beyond monetary IoT use cases, blockchain technologies have many other possible applications. These include improving cybersecurity and providing more trust and integrity in IoT data. It’s still early on, though. Before we see widespread use of these technologies, we must overcome several technical and market maturity hurdles. These necessitate ongoing financial commitments to scientific inquiry and entrepreneurial efforts to test various product/market combinations.
Use cases of IOT Blockchain
Some examples of Blockchain Enterprise applications show how IoT and Blockchain can have a far-reaching impact in various sectors when used together.
1. Supply Chain and Logistics
There are many players in a global supply chain network, including:
- Brokers
- Those who supply raw materials, etc
It makes it harder to see the whole picture. In addition, the supply chain can involve numerous payments and invoices spread out over months. Delivery delays have become the primary obstacle because of the involvement of so many parties.
As a result, businesses are attempting to add Internet of Things (IoT) capabilities to automobiles so that shipment locations can be monitored in real-time. The supply chain and logistics system is complex and lacks transparency; combining Blockchain with IoT can improve network stability and traceability.
Internet of Things sensors can report in real-time with information like:
- Motion sensors
- GPS
- Temperature sensors
- Vehicle information
- Connected devices, etc.
The data collected by sensors is subsequently added to a distributed ledger. After being recorded on the Blockchain, the data is immediately made available to the parties specified by the Smart Contracts. As a result, all parties involved in the supply chain can prepare for transshipments and confidently conduct international business.
2. The Automobile Sector
In today’s business world, the ability to digitize is a must. The Internet of Things (IoT) is helping the auto industry create completely autonomous vehicles through sensors.
Several users can rapidly and easily share vital information by linking Industrial IoT solutions in the automobile industry to the decentralized network.
One promising application of Blockchain with IoT is in the automotive sector, where the two technologies can disrupt by:
- Electronic fuel purchase
- Automatic vehicles
- Robotic parking
- Managing traffic with robots
3. Smart Houses
In almost every aspect of our life, smart IoT-enabled gadgets are indispensable. IoT blockchain makes it possible to control a home security system from afar using a mobile device.
However, the security requirements and ownership of data generated by IoT devices are separate from the conventional centralized manner of exchanging such information.
Blockchain technology has the potential to improve smart homes significantly:
- Addressing Safety Concerns
- Dismantling of a consolidated system
4. Economic Model
Globalization has facilitated the sharing economy’s rapid spread. Using blockchain technology, developers might build decentralized, shared economy applications that enable the frictionless exchange of products and generate substantial cash.
Can we envision an Airbnb unit that automatically finds tenants? Slock. Using Blockchain IoT, it achieves its goals with pinpoint accuracy.
5. The Pharmaceutical Sector
Counterfeit pharmaceuticals are becoming a bigger problem in the pharmaceutical industry. What the pharmacy business is accountable for
Synthesis of New Drugs
Pharmaceutical production
Drug distribution
Therefore, it is impossible to trace medications during their whole route.
Because of its immutability and traceability, blockchain technology can track pharmaceutical shipments from the point of production through final distribution.
6. Farming
Growing more food to feed the world’s growing population is a must to keep your customers happy.
- Reducing human impacts on the environment
- Maintaining open communication all along the supply chain
When applied to the Internet of Things (IoT), Blockchain might revolutionize the whole food supply chain. IoT sensors might be installed in farms to improve the food supply chain further, and their data will be sent directly to the Blockchain.
7. Water Resource Administration
One trillion gallons of water are lost annually in the United States due to leaking plumbing. Puck is a water sensor created by Aquai that can:
- Keep a log of your water consumption.
- Automatic water shutoff in the event of a leak
- NetObjex’s Internet of Things (IoT) and blockchain technologies allow it to track and save data.
Another initiative has been developed to assess river pollution through Blockchain and IoT. Libelium and Airalab have joined to launch a new venture called “Drone on the Volga.” Autonomously collect water pollution data using a drone with the Internet of Things sensors and blockchain technologies. The drone continuously updates the Ethereum Blockchain with water data from the Kuybyshev Reservoir on the Volga River.
The IoT capabilities of the drone allow researchers to trace the source of contamination back to the precise location and time of measurements.
Summary
Several sectors have started looking into how IoT and Blockchain could be used to increase productivity and introduce automation. In this post, we looked at some examples of products already on the market that use this technology to provide solid commercial offerings.
