Blockchain and the future of IoT — Part 2
by Pascal Geenens
To view Part 1 of this blog series, click here.

Circling back to our main interest, the world of the IoT. In order to create a blockchain shared between autonomous devices that fulfills the security properties required to ensure operation of the ecosystem, the ‘good’ devices need to accumulate a minimum 51% share of the compute power in the system. To put this requirement in perspective, consider a Raspberry PI version 3, which represents a fairly well equipped IoT device in terms of memory, storage capacity and CPU power — know that most of the current IoT devices are far behind in terms of their computing capabilities. A RPi3 is able to generate about 10 hashes per second for the Ethereum POW. Your kid’s gaming rig, equipped with an Nvidia GTX1070 GPU, is able to perform this task at a rate of 25.1 million hashes per second. Meaning that in general, to have the same probability of completing the Proof of Work before any hacker with a modern day PC, the system needs to be composed of at least 2.5 million RPi3 devices. Or to put it differently, any IoT system using the same distributed trustless consensus paradigm used by Bitcoin needs to be larger than 2.5 million devices before it could be deemed secure from DoS and reverse attacks by individuals. This is not even taking into account government-sponsored or organized crime hackers as they have access to far more powerful systems, or people who have purposefully built hardware based on FPGAs typically used to efficiently mine Bitcoins.
Another consideration for enabling IoT devices as full nodes in a Blockchain is the storage requirement. Depending on the number of transactions and the size of each transaction in the ledger, the storage requirements will be growing faster than linear as nodes get added to the blockchain. A Bitcoin Core client, for example, requires more than 100GB of storage for downloading the blockchain and that is a real deal breaker for the limited bandwidth and limited storage devices that make up most of the IoT systems.
Considering this, I would argue that a blockchain based on Bitcoin technology, or more generally spoken based on Proof of Work for implementing trustless consensus, will not be able to provide the required levels of security with current gen IoT systems, at least not in a fully distributed and autonomous way. Solutions present themselves in terms of adding centralized cloud servers and cloud storage to accommodate the compute power and storage needs of the blockchain, and as such, reverting back to a more centralized solution while IoT devices become light clients such as proposed in the light client protocol for Ethereum.
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