What’s Next for Blockchain? Internet of Things (IoT)
The Internet of Things (IoT) is a term used to describe billions of interconnected devices around the world that collect and transfer data over the Internet without human intervention. Examples of IoT devices include smartphones, smartwatches, smart refrigerators, fitness trackers, and other devices that have an IoT sensor.
Unfortunately, IoT faces security and scalability problems that have hindered its broader deployment. Security vulnerabilities leave IoT devices defenceless against DDoS and other types of attacks. On top of that, the lack of scalability in the face of a growing number of interconnected devices may lead to congestion in the system.
Blockchain technology is able to address these problems in several ways - by providing stronger encryption, transparency, distributed tamper-proof control over data, reduced transaction times, and lower operating costs.
Initiatives are already there to connect the IoT and blockchain technologies and turn this convergence into real-world implementation.
Ushering the world into smart mobility
One of the pioneers in this area, putting the idea of blockchain-IoT connectivity into action is the Mobility Open Blockchain Initiative (MOBI). This initiative believes that the adoption of blockchain, combined with other modern technologies, will positively affect the provision of mobility services, thanks to allowing business networks to reduce the cost of coordinating their activities. To make this conviction and mission a reality, this nonprofit alliance gathers a large number of stakeholders. They include some of the world’s largest vehicle manufacturers, startups, toll road providers, governments, non-governmental organizations, insurers, transit agencies, e-mobility leaders, blockchain protocols, and technology companies.
Together, they’re working toward making transportation safer, cheaper, more environmentally friendly, more efficient, as well as less congested. To this end, these stakeholders are dedicating resources to develop user-friendly blockchain-based standards used in identifying vehicles, people, businesses, and the unique concept of a Trusted Trip. To understand the concept of a Trusted Trip, we first need to understand what a trip is in general and its role in monetizing mobility in a services economy.
A trip is an entity’s journey from one place to another. It is also the basic unit for monetizing mobility for providers, consumers, and infrastructure owners. In order for these trips to be worthwhile to consumers, producers, and other economic agents in a usage-based mobility payments system, all sides in the transaction must trust them. And this is where the Trusted Trip comes to the stage. A Trusted Trip refers to a trip with its attributes corroborated and confirmed by authorized devices or entities in the co-op decentralized network.
By combining identity (characteristics distinguishing a person or thing) and ubiety (unique positions in space and time) the Trusted Trip facilitates numerous applications toward advancing smart mobility and sustainability. When using a decentralized network, the Trusted Trip ensures the relevant data can be trusted (tamper-proof), thus preserving the value of the shared network.
To put it simply - MOBI combines emerging technologies to give any type of smart device, be it a vehicle, smartphone, sensor (e.g. in a car), road, or another piece of transportation infrastructure identity. On top of that, this convergence of technologies facilitates communication between these devices, as well as autonomous participation in economic transactions as independent agents.
For example, our cars, which already possess IoT sensors and a lot of computing power, could someday soon get the capability to communicate with transportation infrastructure and even act as virtual ATMs. This would allow them to autonomously send and receive payments in a cryptocurrency in a new pay-as-you-go mobility service ecosystem. For instance, you could pay highway tolls or parking through a completely zero-touch automated experience. Some of the well-known partners of the MOBI initiative include Amazon, IBM, BMW, Ford, Hyundai, Toyota, Honda, Bosch, Hitachi, European Commission, General Motors, Ripple, World Economic Forum, and others.
Bringing cargo management into the future
MOBI is far from being the only initiative in this sphere. It is joined byIBM, another pioneer in combining new (and old) technologies for the better. Similar to what MOBI is doing, IBM deploys the amalgamation of blockchain and IoT technologies in transportation. However, while MOBI is dedicated to automatizing mobility, IBM focuses on cargo monitoring.
IBM sees the still prevalent use of paper-based documentation in logistics businesses as a problem that can’t be solved by the implementation of IoT systems alone. The company believes that it can only be fully leveraged by throwing blockchain technology into the mix.
Blockchain enables the creation of smart Bill of Lading (BoL) documents that are stored on a digital ledger and shared with parties involved in cargo transfer. Through data gathered from IoT sensors (e.g. in vehicles and road infrastructure), all participants can verify whether the specified terms and conditions from the BoL are respected. The blockchain also ensures the entered data cannot be tampered with.
Thanks to this system, the participants will also no longer be required to use credit cards for transactions - all transactions will go through their cryptocurrency wallets. This way, all the paper-based operations can be fully digitized, reducing waste and operational costs of cargo management.
Making the world more connected
IoT is just one example of cutting-edge technologies whose advancements have introduced meaningful changes to revolutionize many industrial sectors. Areas where these changes are particularly useful and noticeable are transportation and logistics (although their true potential is endless).
And while such technologies can do a lot by themselves, it is in conjunction with each other that they get a chance to shine. As evident in the examples of MOBI and IBM, which combine blockchain and IoT, these amalgamations can address the challenges of digitization and automation in mobility, unlocking substantial business value while making these sectors safer, more efficient, and more sustainable.
Blockchain and IoT in particular are considered game-changers, thanks to introducing decentralization and enabling remote monitoring and decentralization. IoT facilitates precise tracking of the movement of people and goods, while blockchain provides a fast and secure environment for digital contract storage and transactions involved in that movement.
As seen in the examples above, these two modern technologies used in conjunction can supplement each other, opening a whole world of new business and user experience opportunities.
What do you think the future holds for combining blockchain and IoT? Have any questions or comments, or have you noticed something we missed? We’d love to hear from you, so drop us a comment! We also invite you to check out our blog or join us on our informative and entertaining Blockchain Innovators podcast. There you can learn more about the revolutionary world of blockchain and its constant innovations.