Key Takeaways
IoT is an industry seeing exponential growth, but a traditional centralized architecture cannot provide the scalability for a network with millions of micro-transactions between devices
Blockchain speeds up transactions, builds trust and facilitates data sharing in IoT systems
Aryia, a smart speaker company, is building a smart device that uses blockchain while creating an entire decentralized ecosystem around its product
What is IoT?
From personal smart watches and home speakers to the vision of entire smart cities, the buzz around IoT has been dominating a lot of tech headlines in the past few years. Now we are hearing about the intersection of IoT and blockchain, this article will examine if these two technologies truly intersect in a beneficial way when it comes to cybersecurity.
The Internet of Things (IoT) describes the connection of devices — any devices — to the internet using embedded software and sensors to communicate, collect, and exchange data with one another. Applications for IoT are being found in every industry in the economy largely because of its connection to the big data movement. IoT devices not only generate huge amounts of information, which can then be fed to data analytics tools, but they also rely on data-based logic in order to perform many of their "smart" functions.
Research company Gartner reports that the number of IoT connected devices increased from 6.3 billion in 2016 to 20.4 billion in 2020. According to another research company, IHS Markit, the number of installed IoT devices is expected to grow to 125 billion by 2030. As the number of connected devices continues to grow exponentially, organizations are looking for ways to securely and economically scale their networks.
Traditional IoT systems are dependent on a centralized architecture. Information is sent from the device to the cloud where the data is processed using analytics and then sent back to the IoT devices. With billions of devices set to join IoT networks in the coming years, this type of centralized system has very limited scalability, exposes billions of weak points that compromise network security and will become incredibly expensive and slow if third-parties have to constantly authenticate each and every micro-transaction between devices.
How Blockchain fits into an IoT system
Blockchain has a reputation for establishing trust, accountability and transparency while streamlining business processes. It is able to do this because of the three key properties of blockchain as a data structure: distribution, immutability, and decentralization. But how does blockchain fit into an IoT system?
Blockchain integration would enable devices to send data from these connected devices to private blockchain ledgers for inclusion in shared transactions with tamper-resistant records. Blockchain’s distributed replication allows business partners to verify each transaction, so there’s no longer a need for central control and management. The blockchain records what each participant does and everyone is accountable in the overall transaction.
Smart contracts in blockchain networks will allow devices to function securely and autonomously by creating agreements that are only executed upon completion of specific requirements. It not only allows for greater automation, scalability and cheaper transfers (no third-party needed to oversee transactions), but these smart contracts can also prevent overrides by individuals that want to use the data for their own benefit.
Impacts of blockchain in an IoT system:
Builds trust between the parties that transact together; the immutable record of transactions and data from devices stored on the blockchain provide the proof that lets businesses cooperate
Creates an immutable record of device data and transactions that is required for industry and government regulations
Speeds up transactions for improved customer experience
Specific use cases for blockchain and IoT together
Global supply chains are a complex web of interconnected parties with different priorities. An IoT-enabled blockchain can store the temperatures, position, arrival times, and status of shipping containers as they move. Immutable blockchain transactions help ensure that all parties can trust the data and take action to move products quickly and efficiently.
The ability to track components that go into an aircraft, automobile, or other products is critical for both safety and regulatory compliance. IoT data stored in shared blockchain ledgers enables all parties to see component data throughout a product’s life. Sharing this information with regulatory agencies to verify compliance is secure and easy.
IoT devices track the state of safety for critical machines and their maintenance. From engines to elevators, blockchain provides for a tamper-free ledger of operational data and the resulting maintenance. Third-party repair partners can monitor the blockchain for preventive maintenance and record their work back on the blockchain. Once again, this data can be shared with agencies to verify compliance.
Aryia - private and secured blockchain-powered smart speaker
MACH37 accelerated a pioneer in the blockchain/IoT space when it partnered with Aryia in the spring of 2019. Aryia is disrupting the privacy-invasive smart speaker industry by building the first blockchain-powered smart speaker with an entire decentralized IoT ecosystem around it.
Aryia Alpha, their blockchain-powered speaker, never spies on its users, and doles out Aryia Coins (AYA) to customers as a reward system. Customers can earn AYA by mining, sharing depersonalized data, and filling out market research voice-surveys. AYA can be spent in Aryia’s marketplace on new modules and commands that were contributed by external developers, at a price set by the developers themselves. It is a true token economy.
Aryia is answering today’s privacy concerns by giving users control over their data while rewarding them for any involvement in the Aryia ecosystem. Aryia is also stimulating innovation in the Natural Language Processing (NLP) market by encouraging developers to create and distribute new voice-skills via their marketplace.
The intersection of blockchain and IoT is more than a conjunction of buzzwords; it is the necessary merger of technologies to scale our networks of data-producing devices. Large organizations are starting to plan for IoT/blockchain integration and everyday consumers are looking for smart devices that can securely operate in their own homes.