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IoT and Blockchain

The Internet of Things (IoT) is greatly impacting the interconnectedness of the internet with everyday objects. While IoT has myriad applications of a positive slant, there are a few risks that must also be addressed. 


In this article, you will be introduced to the Internet of Things, its implications and risks, as well as how blockchain technology may be the answer to the challenges faced by IoT.

What is IoT?

The Internet of Things (IoT) refers to a network of real-life objects that are fitted with devices, modules, machines, subsystems or technologies that allow them to connect to other devices and systems on the internet. 


The addition of IoT devices to everyday objects allows them to communicate with the internet without human involvement. This confers these objects with an added level of digital intelligence as they are able to collect and exchange data with other devices connected to the internet. 


These objects are referred to as ‘dumb’ objects because without the added sensors and other such technologies they would be unable to communicate and share data with the internet without a human being initiating the interaction. 


The type of devices that make up the IoT can be small household items, such as baby monitors, all the way to complex industrial instruments designed to automate the manufacturing process. 

According to Oracle, the number of IoT connected devices today number over 7 billion. Experts believe this number will grow exponentially, reaching 10 billion by the end of this year and 22 billion by 2025.


The term Internet of Things was coined in 1999 by renowned computer scientist Kevin Ashton. Ashton is also credited with pioneering a global standard system for RFID and similar technologies, which incidentally have played a significant role in the growth of the IoT industry. 


Speaking to ZDNet, Ashton described the Internet of Things as follows: 

The IoT integrates the interconnectedness of human culture — our ‘things’ — with the interconnectedness of our digital information system — ‘the internet.’ That’s the IoT.

In 1999, when Ashton coined the term the Internet of Things was just a lofty ideal. There were several challenges that made the idea inapplicable. To begin with, computer chips were too expensive to embed them in everyday objects. Additionally, there was inadequate infrastructure in terms of IP naming protocols. However, in the years that followed cheap RFID chips made their way into the market and the IPv6 standard was adopted globally. Today, all types of devices, fridges, watches, mining rigs, make up the IoT, increasing connectivity, and convenience for human beings. 

What are the Risks?

While the IoT is undoubtedly revolutionary, it is still in its infancy. As a result, devices do not always work as they should. There are two main risks connected to the IoT: security and privacy.


Devices connected to the IoT are typically connected to a larger ecosystem. As a result, it may be possible for malicious actors to access these networks if the IoT devices are not properly secured. In 2016, a network of outdated IoT cameras was leveraged to take a number of big websites and other internet-based services offline. These websites included Netflix, Twitter, and the UK government website. Another example is the Chinese manufacturer VTech losing access to audio and visual data of minors from its connected devices.


Privacy and surveillance is the second risk factor with the IoT. The interconnectedness of everyday devices can be used to track the actions of people through the large amounts of data and unprecedented access provided by these devices. Governments, state actors and other malicious actors could use this data to surveil people without their consent. 


The 2016 US director for national intelligence, James Clapper, reiterated this position stating

In the future, intelligence services might use the [internet of things] for identification, surveillance, monitoring, location tracking, and targeting for recruitment, or to gain access to networks or user credentials.

Why Can Blockchain Help?

It is obvious that there is a need to create a framework to manage both the expectations conferred on IoT devices and the complications related to the technology. 


There needs to be a globally accepted standard for IoT devices. The Institute of Electrical and Electronics Standards Association lists a large number of standards in development for varying IoT applications and devices. 


The creation of frameworks through which IoT devices can communicate may help introduce a new level of security. Fortunately, the blockchain is well suited to handle this. This is because while blockchain technology is distributed by nature, it is possible to encode certain standards on the software level, ensuring every node connected to the network follows these guidelines. 


Additionally, as mentioned, blockchain technology is distributed by nature. Thus, there is not one point of weakness as is witnessed in the current server/client model. This may help improve the security issues associated with the IoT. Moreover, it is likely to serve as a big deterrent to surveillance.

Why Will Blockchain Help?

Blockchain technology will likely be leveraged to create networks through which distributed IoT devices can interact on a secure yet distributed network powered by DLT. 


The blockchain already possesses the necessary technological prowess to interact with many different devices while maintaining structural integrity. The application of this to the IoT is a logical step in the right direction. This can be done through blockchain-based mesh networks through which IoT devices can interact securely, with reliable identification and each interaction recorded on a distributed ledger. 


Moreover, blockchain technology can be leveraged to protect the data provided and produced by IoT devices. It is possible to create restrictions on any level of a blockchain network. 


In the context of IoT, blockchain-based applications can be created which allow users to control who has access to the data created by their IoT devices. This protects the rights of the individual. These applications can also be leveraged for larger parties, say corporations and governments, to compartmentalize data so as to reduce the probability of malicious data usage.


These two technologies have numerous advantages and combining them will provide an improved outcome. By applying blockchain on IoT networks, the major flaws of these, security and privacy can be tackled.

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