October is IoT Month at the Alberta Blockchain Consortium (ABC), and we’re going to be exploring some of the amazing synergies between two of the most high-impact digital technologies working to make our world smarter, more efficient and better connected. At the ABC, we work hard to show the transformative potential of blockchain applications, but no technology is an island. With 50 billion devices expected to be online by next year according to Cisco, the IoT revolution is an unstoppable wave of change that will have impacts we can’t yet imagine – and I predict our industries will become deeply linked.
IoT’s effects apply at every scale. We don’t always notice them, but all around us, many of our devices are sensing, recording and transmitting pieces of information, and even acting on this data autonomously. Within just a few short years, the Internet of Things has become a steady background hum of activity as our technologies become more and more interrelated, and better at communicating with each other across networks and applications.
“The opportunity we have is to build a secure, intelligent platform that solves some of the world’s greatest problems at scale. That’s what’s possible with hundreds of billions of connections and the capabilities that we can deliver together.” — Chuck Robbins, CISCO CEO
Tools like our laptops, tablets, and phones are increasingly connected to our environment, creating smart homes where we can access almost every device – from lightbulbs and thermostats to our TVs and appliances – from any location connected to the internet, and have the security of reaching into our automated homes to turn off the oven or check that we locked the door even if we’re on the other side of the world. The best technologies make our lives easier and simpler, and it’s becoming hard to imagine life without this connectivity.
IoT’s advantages mean it has become an unstoppable trend, with spending on smart home devices expected to hit $100 billion this year and ramping up sharply over the next decade. On a bigger scale, emerging smart cities apply IoT to managing and automating their millions of processes, helping to prevent wasted energy and resources, build sustainable policies and a better quality of life for residents. In just a few years, widely deployed sensors will mean things like garbage collectors knowing to stop only where needed, available parking stalls in crowded lots mapped out in real-time, and streetlights automatically adjusting themselves based on environmental conditions.
The number and variety of applications is continually amazing to me, and I think we’ll quickly get to a point where we can’t imagine how we functioned without them. The ability to use data in real-time from a single access point is a powerful tool that will completely transform every aspect of our lives – and economy. Some of the biggest corporations in the world, like PwC, are predicting IoT to quickly become a trillion-dollar industry.
“Internet of Things is transforming the everyday physical objects that surround us into an ecosystem of information that will enrich our lives.” — PricewaterhouseCoopers
Industrial applications are also growing for IoT across many sectors, monitoring supply chains, energy usage and other aspects of business, but there are challenges to large-scale corporate adoption. The vast pools of information, some of it very sensitive, being collected by these devices and accessible at centralized points means that security concerns are very real and very serious. Smart home and city devices are already prime targets for hackers – and corporations have an incredible amount at risk.
This is where the decentralization and transparency of blockchain technologies can join forces with IoT to build a stronger, safer and more verified network – and IoT can create access to real-time information for more effective and relevant blockchain applications.
Better Security: Blockchain technologies can treat every type of information exchange between IoT devices as a transaction, validated along specific parameters and executed as a contract. These transactions are recorded in sequential, timestamped blocks and secured with cryptographic algorithms. This helps make data in the network more secure, private and prevents alterations to previous records.
More Autonomy: Blockchain applications like smart contracts have an incredible ability to enable connected devices to act independently and monitor themselves. Less centralization and a reduced need for oversight or intermediaries due to verified data means more autonomous functioning for IoT devices.
Less Systemic Risk: A leading challenge to IoT is its centralization, which leads to a single point of failure potentially having a major impact on the entire network. Decentralization into millions of individual nodes can significantly improve the system’s fault tolerance and make sure that the information being stored and processed doesn’t rely on only a few central parties.
Trustless Data: Blockchain technologies don’t create more trust between parties – they simply remove the need for trust from the equation through encryption and complete traceability. When it comes to IoT, this helps ensure that data transmissions between devices are accurate and unaltered. When blockchain databases back the information used to create digital twins – online representations of real-world objects or systems used to in IoT applications to optimize performance – it helps reduce errors when using collected data to improve efficiencies.
Easier Transactions: One of the big promises of IoT is the enabling of automated transactions between devices, and blockchain applications like smart contracts are key to reducing complexity and removing the need for human oversight or dispute resolution. Keeping transaction costs low through independently functioning devices also creates the ability for microtransactions – tiny, instantaneous and high-volume payments that allow for more accurate billing per second or minute on things like energy usage.
Lowered Costs: Less infrastructure always means lower costs, and blockchain technologies can assist IoT in reducing the need for an expensive centralized network hub that comes with administrative, maintenance, cybersecurity and other services. This helps IoT become more scalable as well as affordable.
The future is here – and it’s an amazing and global network of automated devices, self-executing processes and continuous data collection that will help streamline our industries, simplify our jobs and build sustainability into the fabric of nearly everything we do. This is such an exciting time to be in the technology industry as we watch our world evolving at a fast pace towards true connectivity in both life and business.
There is so much to learn about how IoT and blockchain technologies can work together, and I’ve only scratched the surface of the incredible synergies. I hope you’ll join the Alberta Blockchain Consortium and Alberta IoT on Thursday, October 3rd at our monthly Wine & Cheese to discover more about how our technologies and communities are converging, and take a look into the emerging potential of our increasingly interconnected world.