When IoT meets Blockchain ❤️by@Niharika3297
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When IoT meets Blockchain ❤️

by Niharika SinghJanuary 28th, 2018
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Internet of Things (IoT) is creating new opportunities and providing a competitive advantage for businesses in current and new market. IoT is all about generation and analysis of data <strong>over the internet</strong>. Hence, consideration must be given to protect data all along its life cycle. It becomes imperative to manage information at all complex levels since data will flow across many administrative boundaries with different policies and intent.

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Internet of Things (IoT) is creating new opportunities and providing a competitive advantage for businesses in current and new market. IoT is all about generation and analysis of data over the internet. Hence, consideration must be given to protect data all along its life cycle. It becomes imperative to manage information at all complex levels since data will flow across many administrative boundaries with different policies and intent.


Present day IoT architecture: Centralised

It relies on centralised, brokered communication models (also known as, client-server paradigm). All devices are identified, authenticated, and connected through cloud servers that sport huge processing and storage capacities. Connection among devices happen exclusively over the internet even if they’re a few feet apart. Also, machine-to-machine (M2M) communication is difficult because there is no single platform that connects all devices no guarantee that cloud services offered by different manufacturers are interoperable and compatible.

The centralised architecture poses challenges to secure IoT deployments. Handling the enormous volume of existing and projected data is daunting. Managing the inevitable complexities of connecting to a seemingly unlimited list of devices is complicated. And the goal of turning the deluge of data into valuable actions seems impossible because of the many challenges. The existing security technologies will play a role in mitigating IoT risks but they are not enough. The goal is to get data securely to the right place, at the right time, in the right format; it’s easier said than done for many reasons.

The centralised security model common in the enterprise today will struggle to scale up to meet the demands of the internet of things, or IoT.

Maybe we could decentralise IoT network?

Adopting a standardised peer-to-peer communication model to process the hundreds of billions of transactions between devices will significantly reduce the costs associated with installing and maintaining large centralised data centres and will distribute computation and storage needs across the billions of devices that form IoT networks. This will prevent failure in any single node in a network from bringing the entire network to a halting collapse.

Two Main Types of Blockchain-

  • In a public blockchain, everyone can read or write data. Some public blockchains limit the access to just reading or writing. Bitcoin, for example, uses an approach where anyone can write.
  • In a private blockchain, all the participants are known and trusted. This is useful when the blockchain is used between companies that belong to the same legal mother entity.

Blockchain and IoT

Blockchain technology can be used in tracking billions of connected devices, enable the processing of transactions and coordination between devices; allow for significant savings to IoT industry manufacturers. This decentralised approach would eliminate single points of failure, creating a more resilient ecosystem for devices to run on. The cryptographic algorithms used by blockchains, would make consumer data more private.

The ledger is tamper-proof and cannot be manipulated by malicious actors because it doesn’t exist in any single location, and man-in-the-middle attacks cannot be staged because there is no single thread of communication that can be intercepted. Blockchain makes trustless, peer-to-peer messaging possible and has already proven its worth in the world of financial services through cryptocurrencies such as Bitcoin, providing guaranteed peer-to-peer payment services without the need for third-party brokers.

The decentralized, autonomous, and trustless capabilities of the blockchain make it an ideal component to become a fundamental element of IoT solutions. It is not a surprise that enterprise IoT technologies have quickly become one of the early adopters of blockchain technologies.

In an IoT network, the blockchain can keep an immutable record of the history of smart devices. This feature enables the autonomous functioning of smart devices without the need for centralized authority. As a result, the blockchain opens the door to a series of IoT scenarios that were remarkably difficult, or even impossible to implement without it.

By leveraging the blockchain, IoT solutions can enable secure, trustless messaging between devices in an IoT network. In this model, the blockchain will treat message exchanges between devices similar to financial transactions in a bitcoin network. To enable message exchanges, devices will leverage smart contracts which then model the agreement between the two parties.

One of the most exciting capabilities of the blockchain is the ability to maintain a duly decentralised, trusted ledger of all transactions occurring in a network. This capability is essential to enable the many compliance and regulatory requirements of industrial IoT applications without the need to rely on a centralised model.


Supply-Chain Use Case

As IoT continues to grow at a rapid rate, sensors and devices are becoming more common place to communicate.

In business networks, where data such as location, temperature, vibration, humidity need to be shared a permissioned blockchain ledger can help create a tamper evident record. This opens new ways to automate business processes without setting up costly centralized IT infrastructure and all participants have access to same data.

How supply chains benefit when data is shared through a permissioned blockchain?

The IoT enabled packet transmits required information such as temperature, humidity, etc as it passes through multiple carriers. The business contracts specifies the conditions that must be met during the shipment from factory to grocery store and all parties must adhere to the terms of the contract.

Result: Happy customer with peace of mind about the food in his or her cart.

Micro-Payments Use Case

Imagine tour fridge telling you how much milk you’ve left and if you’re low on it, your fridge automatically adds it to your shopping list.

Or how about this!

When your car is at fault, it will book a mechanic automatically.

All this is possible via smart contracts. This can be done with Ethereum as platform. In a way, Ethereum is rewriting IoT architecture.

IoT and Blockchain in Health


Registering permissions to access patient-generated data on blockchain, users are empowered to control who can access their data, and under which conditions. This capability enables individuals to be the owners of their precious data asset. This data set can be compiled from information originating from a variety of data sources; ranging from electronic medical records provided by hospitals, clinics and doctors, to fitness/wellness data generated by mHealth apps and wearables. It can also be complimented by disease and treatment monitoring applications and custom information added by a user individually.

Blockchain in IoT represents the biggest technological disruption since the integration of computing and transaction processing systems. Due to major progress in device innovation and software, it is now possible to bring transaction processing and intelligence to devices everywhere. There are critical adaptability challenges connected with distributed systems, as well as security, coordination, intellectual property management, identity, and privacy. Many institutions and individuals are actively working on these issues and building an open source foundation for the proliferation of this technology.