IoT devices are on the rise, with the number of businesses that use IoT technology having increased from 13 percent in 2014 to about 25 percent in 2019. Clearly IoT technology is becoming a key tool for businesses, however there are a few challenges that it needs to overcome in order to ensure large scale adoption of IoT devices. Currently, IoT devices still face issues such as vulnerability to hacking, reliability problems, latencies and bottlenecks, and a limited ability to ensure transparency in supply chains.
Fortunately, new technological developments mean that the industry is finally able to address these issues. Since its ‘hype period’ in 2017, blockchain technology has been steadily maturing, and has now reached a point where it can work alongside IoT, creating incredibly secure, scalable and efficient networks to underpin IoT devices to solve many of its associated challenges. Indeed, IoT and blockchain are terms that are increasingly meeting when it comes to discussing which technologies will underpin society in the future. Both involve a connected network, so are inherently complementary, and the security and transparency that blockchain provides holds the key to many of the issues that IoT currently faces. Blockchain is set to accelerate IoT adoption and open up new opportunities for companies and consumers alike.
Lars Rensing, CEO of enterprise blockchain provider Protokol, outlines four of these opportunities and how blockchain is supporting the IoT industry:
1. Securing smart cities by ensuring no single point of failure
There are set to be 125 billion connected IoT devices by 2030 – a development that is expected to have a big impact on the growth of smart cities. Smart cities use IoT devices like connected sensors, lights, and meters to collect and analyse data. This data allows cities to improve infrastructure, public utilities and services, and more. However, with IoT devices typically reliant on Bluetooth or Wi-Fi, hackers could use this avenue to access networks for malicious intent. With the number of devices that will be connected, this could pose significant risks to consumer and company data, and the future of smart cities.
This is where blockchain in IoT comes in. The technology is fundamentally a decentralized network, meaning that information on the blockchain is held across each and every node in the network, as opposed to in one centralised location. For IoT, this means the risk of data being compromised via a single point of failure (such as a cloud server) is eliminated. A malicious attack would need to corrupt the encrypted data held by the majority of nodes in the network, simultaneously — an almost impossible feat.. This means that an IoT network within a smart city that utilises a secure blockchain foundation would be significantly more secure and resilient.
2. Creating a better system for pay-as-you-go mobility
The number of people using car-sharing services facilitated by IoT technology is growing and is expected to reach 18 million by 2025, but there are still concerns about the security of systems that support them and their vulnerabilities. For example in a study into 13 car-sharing applications, every single one was found to have security issues. Blockchain technology is being harnessed to ensure seamless and secure pay-as-you-go mobility services for customers, by providing a more reliable and secure network foundation for IoT-enabled vehicles. In addition to enhanced security, the mobility industry is turning to blockchain technology for simple data exchange and the autonomous execution and settlement of contracts and billing, enabling further advantages and a better experience for the customer.
3. Enhancing manufacturing maintenance and security
The IoT has become a staple in manufacturing in recent years. Many manufacturers now use IoT sensors to monitor the conditions of machinery and manufacturing process in real-time, to enable preventative maintenance, so they can spot and address issues before they occur.
However, security and reliability issues plaguing connected machinery and IoT devices are causing manufacturers to take a more cautious and incremental approach to rolling out IoT technology in their businesses. Blockchain’s innate immutability, decentralised structure, secure encryption capabilities, and consensus-based approach seem to be the perfect solution for the challenges that the IoT industry is facing. Manufacturers are turning to blockchain to ensure diagnostics data is reliable through immutable digital ledgers while sharing tamper-resistant records with maintenance partners, eliminating unplanned downtime and the cost that comes with it.
4. Enabling better transparency in the supply chain
Companies across sectors use IoT sensors to ‘track-and-trace’ goods in real-time to ensure they are meeting certain conditions (e.g. the right temperature) or are in specific locations at the required times. As supply chains continue to grow in size and complexity, companies have to learn to work with more moving parts, while maintaining a steady and acceptable level of efficiency. The combination IoT sensors with blockchain technology, however, is enabling information to be shared more securely across ecosystems, providing all relevant parties across the supply chain with accurate information through an immutable and hack-proof ledger. This enhances the ability to spot issues in transit or take preventative measures. This is leading to better efficiencies and fewer delays, which is particularly important if the supply chain concerns things like healthcare equipment or even organ transplants, where visibility is critical.
The IoT is fast becoming an integral part of everyday life, with the use of IoT devices only set to increase in the coming years. As this increases, we could see IoT become integrated with everything from manufacturing to car sharing and shopping, making every experience more seamless. With this being the case, it is important that the IoT industry ensures that all the technological creases are ironed out, be that slow networks, latencies, bottlenecks, reliability or data breaches. Blockchain in IoT is the missing piece of this puzzle. The decentralized nature of the technology allows for a more secure IoT, which will be increasingly crucial as smart cities grow and the technology becomes more prevalent in our everyday lives.