The Internet of Things (IoT) is currently shaping up to be one of the biggest disruptions that will revolutionize the world. The idea of devices that can “communicate” among themselves by sharing information and making logical follow-up decisions in response to shared information is simply awesome. Interestingly, Blockchain technology is being touted as a potential growth driver that could propel IoT to the mainstream market. It is worthy of note that Blockchain technology is currently powering a paradigm shift in the global economic landscape with Bitcoin
One of the major factors that make Blockchain a great backbone for IoT is the public nature of Blockchain. Everybody taking part in a blockchain can see the data making up a block, even though the actual content of the data is protected by a private key. Hence, there’s practically no reason to have a third party verify data. The data encoded on a blockchain is immutable and already verified just because they exist. In addition, the decentralized nature of the blockchain eliminates the need to have any central authority approve data exchange transactions.
Of course, critics will be quick to point out that the adoption of Blockchain to power the Internet of Things will be delayed because of the depth of trust needed to make a decentralized ecosystem work. However, the fact that a Blockchain database can only be extended and not altered; ensures that provenance of IoT data where stored or shared on a Blockchain network.
Streamr is pioneering collaborative consumption of IoT Data
Streamr, a blockchain startup has created a solution that makes it easy to integrate the decentralized nature of blockchain with the highly-fragmented IoT industry in order to create one giant smart ecosystem. Streamr believes that there’s gross inefficiency in the current model in which the data that IoT devices generate are owned by companies who make/sell such devices.
To begin with, much of the data generated by IoT devices are practically left unused because there are no data apps available to analyze and get value out of the huge volume of data. By 2025, experts predict that more tha 27 billion IoT devices will generate 2 zettabytes of data Secondly, many of the firms who current “own” data generated by IoT devices do not share the data with other firms or the public; hence, it is practically impossible to mine valuable information from such fragmented data held by different companies.
Streamr is trying to tokenize data in other to help you own the data that your devices generate, sell the data to whom you please, and keep the data on an immutable peer-to-peer network not owned by any single company. The tokenization of data allows you to automatically upload to a data stream that creates one massive “consciousness” for different data pool to paint a fuller picture. For instance, a data pool of electric cars or self-driving cars in a city can create a fuller understanding of traffic patterns, road conditions, perception of other road users, and quality of roadside assistance than the data point from a single car viewed in isolation.
Streamr also wants to incentivize the collaborative consumption of data with its DATAcoin digital token. DATAcoin, will be used to access (buy) data uploaded on the network to encourage the growth of data streams. DATAcoin will also be used to operate the data market, reimburse data producers, and to keep network participants interested in the operational efficiency of the blockchain network.
Three areas where Blockchain can directly influence the IoT industry
Increased security across IoT devices
One of the biggest challenges facing IoT or any ecosystem of networked devices for the matter is security. Irrespective of the kind of security measures in built into your devices – encryption, firewalls, biometrics authentication—a smart and determined hacker will eventually find a way to get past your defenses into your system.
Secondly, the human element of networked systems also adds another layer of vulnerability to networked systems. Not many people understand the importance of creating passwords that doesn’t include their birthdays – and most people simply can’t just be bothered to change their passwords regularly.
Blockchain however presents a layer of security that is practically unprecedented among current security offerings for networked systems. Blockchain eliminates the odds that the security of your devices will be compromised because of the sheer volume of the complexity that would be required to alter recorded data on a blockchain.
Co-owned self-driving cars
One of the biggest Blockchain applications for the Internet of Things would be found in the economics of self-driving cars. Tech firms such as Tesla Motors, Alphabet’s Waymo, and traditional automakers such as Volvo and General Motors are working on building self-driving cars. Under a Blockchain ecosystem, a number of people could create a smart contract to pool money for the purchase of a self-driving car. The contract could also contain, “If this, then that” rules for sharing the maintenance costs of the car where necessary. The co-owners could also store and share data about who has the car and at what time on a decentralized ledger to log riding miles among other things.
The rules of operation on the blockchain can also be designed in line with reputation standards on the requirements that each co-owner must meet. For instance, if a driver hasn’t done the required monthly maintenance checkup, the car can be programmed to deny access such that it won’t be unlock or drivable until the maintenance requirements are met.
Communal renewable energy projects
The world is making a concerted effort to adopt renewable sources of energy as part of efforts for a greener earth. Solar energy is greener than burning fossil fuels but its upfront investment is somewhat pricey. Communities such as Brooklyn Microgrid can pool resources to get off the grid and use blockchain to log individual energy consumptions of member of the community. Individuals can also invest in setting up their own solar energy system, and then use blockchain to log and sell off excess solar energy credits.
In addition, a blockchain can make it easier for smart cities to log the production of solar energy. Solar energy installations can have individual identities on the blockchain and home appliances and systems that feed off the generated energy can also have IP addresses; hence, it becomes easier to collate an immutable history of records that can be aggregated in prediction of energy use trends.