The rapid advance of Blockchain technology and the Internet of Things (IoT) are felt throughout our daily lives. A Gartner study estimates Blockchain will add $3.1 trillion in business value by 2030, and in another analysis the global IoT market is expected to grow from $157B in 2016 to $457B by 2020. We are about to see more change than we could imagine with Blockchain and IoT.
These applications will disrupt existing processes across variety of industries including manufacturing, trading, shipping, the financial sector and healthcare. In spite of these advancements security remains a top concern for the IoT ecosystem as it exposes multiple devices, huge amounts of data, supply chain partners and the community as a whole to security breaches. For example, in healthcare the privacy integrity and control over access to data is paramount and critically important. As the connections of various IoT devices that monitor a patient’s real-time medical data increases, the entry points for hackers also increase.
With IoT devices proliferating, these devices often lack the authentication standards necessary to keep user data safe. Critical infrastructure will be damaged if hackers penetrate through the broad range of IoT devices. To ensure trust, authentication and standardization across all elements of IoT are essential for widespread adoption.
Here are some ways the distributed architecture of Blockchain can help solve many of these security and trust challenges:
- Blockchain can be used to track the sensor data measurements and prevent duplication with any another malicious data.
- Deployments of IoT devices can be complex, and a distributed ledger is well suited to provide IoT device identification, authentication and seamless secure data transfer.
- Instead of going through a third party for establishing trust, IoT sensors can exchange data though a Blockchain.
- A distributed ledger eliminates a single source of failure within the ecosystem, protecting an IOT device’s data from tampering.
- Blockchain enables device autonomy (smart contract), individual identity, and integrity of data and supports peer to peer communication by removing technical bottlenecks and inefficiencies.
- The deployment and operation costs of IoT can be reduced through Blockchain since there is no intermediary.
- IoT devices are directly addressable with Blockchain, providing a history of connected devices for troubleshooting purposes.
Blockchain-based IOT solutions are well suited for simplifying business processes, improving customer experience and achieving significant cost efficiencies.