The Internet of Things (IoT) is a system used for the distribution of information without the need for human interaction. There, information on computing devices, objects, humans, animals and all sorts of things using a unique identifier can be shared over a network.
At its most basic level, a thing in the Internet of Things can be a patient wired to a heart monitor, a cat implanted with a tracking chip, or a car using sensors to alert drivers when the tire pressure is low. It is an evolved technology achieved through the merging of wireless technologies, microservices, and the Internet.
Let’s look at the traditional methods of health monitoring compared to the IoT-integrated methods in order to achieve a greater understanding. Smartwatches now have the ability to track aspects such as heart rate, physical activity and inactivity, calories burned, and much more. The watch, in this case, would be a human’s unique identifier. The processes and collecting and processing the generated data, which would take a substantial amount of time in the past, are now streamlined through IoT.
How Does IoT Benefit from Blockchain?
The major concerns associated with IoT are security and privacy. Blockchain addresses these issues through its use of a distributed ledger. Blockchain has the ability to track innumerable numbers of smart devices and log the data they collect on either a public or private ledger.
The ledger is shared across all the users of the network, and therefore cannot be altered by a single individual without a general consensus. It runs on cryptographic algorithms which are extremely difficult to decipher, making it practically impossible to hack. Basically, blockchain helps to close the gaps in security associated with IoT.
Where IoT automates the collection of data, blockchain automates its security and authenticity. As shown by OpenLedger, blockchain paired with IoT can bring substantial benefits to various industries:
Healthcare: Blockchain can enable the tracking of a patient’s chronic condition in real time.
Supply chain: Blockchain can improve inventory management.
Automotive: Blockchains’ authentication aspects make it a valuable tool to prevent the trade of fraudulent parts, as well as streamlining payment and document processing, which is often prone to problems associated with human error.
Notable Use Cases
Blockchain in conjunction with IoT can be used to improve multiple aspects of business, and more and more companies worldwide choose a combination of the two to achieve their goals.
Real-time Transit Visibility & Status of Shipments
The conjunction of blockchain and IoT can improve workflows and shipments by managing shipping container inventory as well as by tracking transit in real time. This means a company will always know where their shipments are and what is being shipped at all times. The company’s asset history and life cycles can be managed through the recording of maintenance procedures, as well as by logging events in which an asset has received damage. The real-life use cases are endless — from transportation to product transit status tracking.
In May 2018, one of the world’s leading diamond companies, Da Beers Group, has successfully tracked 100 high-value diamonds using their platform called Tracr™, developed in cooperation with five leading diamond manufacturers — Diacore, Diarough, KGK Group, Rosy Blue NV and Venus Jewel.
“The Tracr project team has demonstrated that it can successfully track a diamond through the value chain, providing asset-traceability assurance in a way that was not possible before,”
said Bruce Cleaver, CEO of DeBeers Group, in the public statement.
Supply Chain & Food Safety
A combination of IoT and blockchain can be especially useful for companies that handle food. It can track produce from farm to table, which is crucial when dealing with national concerns, such as an E.coli outbreak.
The fact that every piece of data is recorded and traced means that instead of recalling or disposing of food that is thought to be tainted, businesses can look it up on the blockchain in order to identify where the problem occurred, and which portions of a product were affected. For example, if an E.coli outbreak is reported, instead of all stores throwing away their entire stock of romaine, they can look at the history of an item recorded on a digital ledger, and identify where the outbreak started, and then remove romaine sourced from the affected area from their stores. It may even be eventually possible for customers to view the entire history of an item, thereby increasing transparency and trust.
The largest retailer in the world, Walmart, has teamed up with IBM to roll out a real-life use of IBM Food Trust to track and manage produce from suppliers to customers’ homes and tables. Additionally, U.S. Centers for Disease Control and Prevention are exploring blockchain and IoT to prevent and eliminate future outbreaks of E.coli.
Blockchain’s decentralized ledger provides security and transparency, and therefore is being more and more widely adopted by major banks.
There are also real-life use cases in the banking industry, which combine blockchain and IoT. For instance, Wells Fargo, Brighann Cotton and the Commonwealth Bank of Australia have partnered up and performed the first ever interbank trade transaction combining blockchain technology, smart contracts, and IoT. Additionally, there are 34 banks across the world that are participating in The Blockchain Project by SWIFT, aimed to improve bank-to-bank transfers.
Where do we go from here?
IoT was developed to improve and simplify aspects of our day-to-day lives, yet faces issues associated with security. Blockchain was developed to enhance security associated with the transaction of information, but at first failed to find alternative uses. When paired together, these innovative technologies compensate for what they would lack when apart.
Blockchain and IoT are still relatively new and their uses are still being explored. However, once their potentials are fully revealed, these technologies will not only have the ability to enhance industries but possibly even humanity as a whole.