The world of technology is moving at quite a pace. With everything from smartphones and smart kettles to multinational corporations holding their data on the cloud, our lives are increasingly being controlled from one centralised system: the Internet of Things. The IoT brings with it many benefits, but also numerous risks. With an estimated 30 billion new devices ready to come on board by 2020, our security and our privacy could be vulnerable to attack.
The issues this poses for companies and individuals come in a range of guises, not least the potential for hacking, data breaches and malfunctions. In addition, the time, costs and infrastructure required to manage, keep track of and store huge amounts of data passed between the billions of devices coming online are colossal.
So how can blockchain improve IoT?
Blockchain technology is a global ledger which was originally developed to track Bitcoin. However, it can be programmed to keep track of just about anything. This means it has a range of advantages for improving the Internet of Things:
As a decentralised, self-governing system, blockchain can be used to keep records of all transactions or communications between devices. The ledger is permanent, which means it can’t be altered by outside forces. Bosch has already seen the potential by utilising a blockchain-verified solution to accurately monitor distances in car odometers.
Being decentralised means blockchain’s security offering is more easily scalable, helping eradicate the threats faced by traditional centralised server models. It can be used to micromanage home or company internet ecosystems, monitoring communications between connected devices on the network and those devices with the wider, external IoT, cutting off access if it detects a rogue connection. The Australian telecom company Telestra is already using blockchain technology to secure home IoT systems.
Coordination between devices
The vision for the future of the IoT is that smart sensors will become increasingly common ways of recording and sharing data, whether that’s monitoring environmental changes, levels of pollution or even comparing insurance quotes. Blockchain can be used to organise the infrastructure and data collected by smart sensors and carry out a pre-programmed response, or smart contracts, whether that’s turning up the heating, issuing a payment or negotiating a deal.
Blockchain-powered peer-to-peer lending platform MyBit is involved in a range of future industries, including solar power. It already envisages a decentralised system of microgrids which it can use to store and reuse energy, selling excess power back to the central grid or on the open market.
Thanks to its ability to handle vast amounts of data and processes which would be too time-consuming to set up individually or even oversee, plus its low power operation thanks to a decentralised model, blockchain technology can save companies huge amounts of time and money. These are savings which can be passed down to consumers.
Blockchain in the real world
Blockchain has already proved its worth in the world of Bitcoin transactions, and many innovators are already looking to the ways it can be scaled up to future-proof the burgeoning yet risk-prone Internet of Things.