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IoT (Internet of Things) refers to a network that unites physical objects connected by sensors, modules, and actuators and gathers and shares data about how they're used and their surroundings. IoT uses its analytic capabilities to transform data collected into insights that enhance business operations and inspire innovative approaches for operation. Statista estimates there will be 29 billion IoT devices by 2030; by that same year, its global value should have hit one billion dollars.
Data indicates that IoT will continue to play an essential role in all aspects of our lives - from lifestyle and healthcare, manufacturing, automotive production, and distribution - but its implementation of cybersecurity becomes harder over time. Due to the massive volume of information that needs to be transferred and processed, data breaches or hacks remain a risk. Unfortunately, as previously discussed, data security will become even more complex as more IoT devices come online in future years.
Blockchain technology could prove particularly helpful here; hackers would face additional layers of defense before being able to gain entry to IoT networks with sensitive data stored on the blockchain.
Boosting IoT Data Security With Blockchain Technology
Blockchain refers to an infrastructure in which multiple computers operate together to keep track of Bitcoin or similar IoT cryptocurrency transactions. Due to how data is stored, hacking or alteration is almost impossible due to blockchain's extremely strong encryption, which makes overwriting current records exceedingly challenging.
With the Internet of Things, devices can now send data directly into private blockchain networks for storage as unchangeable records of shared transactions making accessing and sharing IoT data simpler without needing management or central control.
How Does The Internet Of Things And Blockchain Interact?
So as to reduce disagreement and increase trust between all users of a permissioned network, each transaction within a blockchain is independently confirmed by various sources before being added to a shared ledger accessible from every node in its network.
IoT and blockchain combine forces to enable smart device operations independently from each other while monitoring device-to-device communication. Though blockchain has its advantages, its decentralized nature poses challenges for IoT due to its hub-and-spoke or client-server structure.
As such, ensuring interoperability with blockchain networks and ensuring interoperability between IoT platforms and sensors can be tricky; configuration of Internet of Things sensors according to their processing and storage needs may prove challenging.
Top Applications For Blockchain Technology Enabled By IoT
IoT improves IoT ecosystem security and transparency. Here are a few well-known IoT blockchain use cases that have an enormous influence on various industries:
Operational Maintenance
IoT gadgets use blockchain to monitor machine conditions for maintenance and safety purposes. An unalterable record exists of operational information from engines to elevators on this distributed ledger technology platform. As such, external repair partners can monitor preventive maintenance on the blockchain and document their work within it; to help verify compliance, operational records can also be shared with government agencies for compliance verification purposes.
Freight Transportation
Transportation of freight requires cooperation among multiple parties. An IoT-enabled blockchain provides reliable storage of temperature, arrival times, and current state information of shipping containers while they're en route, providing all involved with information they can rely on quickly moving freight quickly and effectively.
Pharmacy
Since the pandemic affected our lives, we've become more reliant on medications. Yet, counterfeit goods in the pharmaceutical sector seem more prevalent each day.
Since pharmaceutical companies are responsible for conducting the research, development, production, and distribution of medications to the general public, it is of vital importance that certain safeguards be put in place in order to guarantee only genuine medications reach consumers. Blockchain technology's transparent and traceability properties enable safe and efficient transportation of drug supplies from one location to the next.
Smart Homes
IoT technology has become integral to daily living. Gaming consoles, smartphones, tablets, and laptops all serve as hubs from which devices connected in our homes can be controlled, be it appliances in the kitchen, door locks, cameras, home monitors, and thermostats accessible. A home automation system enables easy management of such connected devices as well.
Blockchain offers solutions for security concerns while eliminating centralized infrastructure elevating the concept of smart homes. For example, biometric and voice or face recognition methods may help ensure data collected by smart devices does not end up falling into malicious hands.
Supply Chain Management
Efficient regulatory compliance and safety require being able to keep tabs on components used in cars, airplanes, and other products. Thanks to IoT data stored in digital ledgers shared among manufacturers, shippers, government agencies, or anyone else involved throughout its life cycle provenance can easily be seen for all components at all points during product production life cycles. All parties involved can view which component has come from where thanks to simple sharing mechanisms between IoT sensors in connected products making the entire production cycle transparent for everyone involved manufacturers, shippers, as well as government agencies or manufacturers using shared digital ledgers for sharing purposes.
Insurance
Smart contracts combined with Internet of Things data gathered from wearable personal technology and location-based sensors like home alarms, factories, and warehouses, as well as sensors on objects (shipping containers and vehicles), have greatly simplified managing claims, fraud, and property casualty insurance coverages.
Benefits Of Blockchain In IoT
Each transaction is tracked in an immutable digital ledger organized into data blocks on an unchangeable chain making blockchain security such a smart idea when applied to IoT security solutions. Below are the benefits of blockchain in IoT:
Lower Costs
Blockchain provides decentralized data submission. As scaling highly scalable infrastructure can become expensive over time, decentralizing IoT solutions reduces business expenses over time while eliminating single points of failure and single-point risks.
Improved Security
Utilizing blockchain technology enables you to selectively manage, analyze, customize, and share certain data sets with approved vendors. Blockchain verifies data's legitimacy and source credibility strengthening privacy agreements to enhance secure communications.
Blockchain makes that possible while protecting data and controlling access control, providing transparency of who conducts transactions or has access to IoT data. Blockchain also ensures multiple security layers can be established against unwanted access while protecting user privacy by protecting their identity with multiple security layers, something traditional ledger systems cannot achieve effectively.
Quick Data Change
Blockchain meets IoT performance needs by employing trusted nodes to reduce transaction validation times, speeding up data exchange speed. It was developed specifically for your multi-cloud environment while remaining open and interoperable. Utilizing data gleaned from IoT-connected devices and sensors, this technology uses IoT data to improve workflows and generate business value throughout its system.
Streamlined Finances
A finance department is one of the core divisions within any organization and as it handles sensitive data, requires added transparency provided by blockchain and IoT technologies. A predetermined procedure must be observed when sending or exchanging funds or data via timestamped linear chains like blockchain; no unauthorized individual may access or alter any ledger records added without first receiving authorization to do so, and this further strengthens it by increasing reliability.
Efficient Supply Chain
Every business strives for an efficient supply chain; however, global and economic difficulties make this goal challenging to attain.
Blockchain and IoT can significantly accelerate transaction speed, reduce transaction costs, and enhance supply chain efficiency by eliminating intermediaries. A standard supply chain transaction may incur higher total fees if its validation takes four or five attempts before being successful; using Blockchain/IoT may make this more feasible than ever.
Blockchain can enable direct data exchange among untrusted parties without intermediary fees if it's present for validation purposes.
Also Read: Why Combine IoT with Blockchain? Discover the Cost-Saving Impact of These Top Enterprise Use Cases!
Challenges Encountered While Implementing Blockchain In IoT
As previously discussed, maintaining data security in an IoT ecosystem is no simple matter due to its client-server architecture, which offers single points of failure that leave room for cyber attacks and allow unauthorized intrusions into systems.
Blockchain solves this issue by moving decision-making away from an authoritative central authority and into an IoT device network based on consensus. However, when designing such architecture it must consider three essential considerations.
Scalability
IoT development poses several vexing scalability problems. One such challenge lies in managing all of the data a vast network of sensors generates while still being efficient when processing transactions and latencies are reduced, an essential question. Establishing an accessible data model prior to launch helps avoid issues when rolling out product offerings.
Security Risks
Smart contracts are essential in making IoT-powered blockchain systems efficient; however, their automation raises security issues that could prevent blockchain from becoming widely adopted for IoT applications.
Smart contracts that operate decentralized public blockchain networks may contain bugs despite being hard to hack; cybercriminals also search out potential weaknesses in these contracts in order to target them and exploit them for personal gain.
Smart contracts must be carefully evaluated and tested to mitigate this potential problem. Although you cannot always guarantee 100% that there won't be bugs present, testing your smart contracts regularly should reduce their chance of occurring and negatively affecting blockchain/IoT architecture.
Sensor Reliability
How trustworthy can sensors be? Sensors could interfere with the accurate measurement of criteria necessary for carrying out transactions, which requires accurate measuring tools. Therefore, taking measures against outside interventions that alter sensors is essential if creating a secure environment for transactions and data recording to occur successfully.
Network Privacy And Transact Confidentiality
On a public blockchain, access to transaction history within an IoT device network's shared digital ledger is restricted due to transaction pattern analysis, which attempts to discern who lies behind public keys and deduce their identities or devices that use public keys as identities. Businesses should assess their privacy requirements to ascertain if private or hybrid blockchains would best fit them, then take appropriate actions.
Determining Power And Time Needs
IoT uses Proof of Work (POW) consensus algorithms in order to achieve maximum security from blockchain technology. While not difficult, POW requires doing lots of quick math over extended periods - discouraging hackers from engaging in computing-intensive operations at all costs.
Innovative Internet of Things and Blockchain Projects
Due to blockchain's relatively new nature, its integration into Internet of Things solutions may not go smoothly at first glance. This is due to both technologies requiring specialists with ample expertise to handle any unforeseen situation that arises. Unfortunately finding such talent may prove challenging, which will surely impede projects' completion.
Conclusion
Integrating blockchain technology with IoT holds immense promise to enhance the security, transparency, and effectiveness of decentralized systems. Leveraging its immutability and distributed properties - immutability being defined here as the immutability of participant trust as opposed to vulnerability - Internet of Things devices may experience improved data integrity as well as reduced vulnerability due to malicious attacks. Smart contracts further foster trust by automating predefined agreements securely for transaction processing on IoT transactions.
Blockchain's ability to produce an unalterable and transparent ledger ensures the authenticity of data produced by Internet of Things (IoT) devices, eliminating unwanted modifications while increasing reliability within networks. Furthermore, decentralized consensus methods make IoT infrastructure more robust and fault-tolerant.
