A Guide to IoT and Blockchain: How the Unlikely Duo are Tackling the Fourth Industrial Revolution
So what exactly is IoT? Usually when people try to describe the “Internet of Things” they sum it up as everyday items being connected to the web and having smart features, like phones. When envisioning IoT, one might imagine a refrigerator with an internet browser and a grocery list. But is that really all it comes down to? Is IoT really just color-changing light bulbs and smart fridges?
The truth is, much like the internet itself, IoT is a disruptive evolution of ideas with an impact that may not be immediately apparent, but that carries with it tremendous implications for society going forward. The inter-connectivity of all things and the insight gained from the data acquired is going to change the way people interact with each other; and with their surroundings. Cities will be able to adapt and evolve along with their populations, machines can be automated in dynamic conditions, consumer technology can customize itself to better fit the personalized needs of the user, hardware diagnostics can be monitored in real time, and so on. The possibilities are endless, and it is only one key part of what some call the fourth industrial revolution, aptly named “Industry 4.0”.
Industry 4.0 is a colloquial way of referring to a myriad of new technologies coming together to form a new paradigm in manufacturing and related processes. A.I., cyber-physical systems (smart machines that respond to the physical environment like self-driving cars and autonomous surgery robots), cloud computing, and the IoT (Internet of Things) are synergizing to form this new standard. Due to the groundbreaking nature of the technology involved, it will also have a rapid and exponential impact on society.
So what stands between us and that standard, now?
IoT, the interconnectivity between all of these things, is key:
- Security: If everything is always connected and data about all things constantly flowing through the network at all times, it would need to be orders of magnitude more secure than modern network security standards.
- Data Bottlenecks: The amount of data being transferred at all times between everything would be enormous, and it would be hard not to reach the limits of bandwidth and speed, thus limiting the usefulness of IoT.
- Scalability Issues: IoT would need to scale to an enormous size, which means using regular technology would result in an unusable, congested network of transactions.
- Cost of Operation: The cost of maintaining an infrastructure of constant connection and data would match the size of the network itself.
- Business Model : Businesses would have to adapt in order to find a way to accommodate for the cost of operation and acquisition of data.
- Data Centralization : Your data being in the hands of a third party is just not a good idea. It can be mishandled, abused, sold, exploited, controlled, and monopolized.
Unless these problems can be solved, IoT will never realize its full potential, and industry 4.0 will thus remain a pipedream without it. Problems of this magnitude will take decades to solve, if at all, unless an absolute breakthrough is made.
As it turns out, a breakthrough may very well have come in 2009, in the form of a revolutionary new form of technology: Blockchain.
When skeptics talk about Bitcoin, the phrase “the technology is good” might come up more than a few times. This probably stems from the fact that along with the new digital currency also came a brand new, disruptive technology; the importance of which is hard to minimize. The advent of the proof of work consensus algorithm allowed for a decentralized, trustless, and immutable form of distributed ledger. If you are familiar with the technology behind blockchain then you know that due to its very nature, it is uniquely equipped to be able to solve a plethora of huge issues standing in the way of the IoT future. All at once, Blockchain provides decentralization, a new business model where the investors of a network own and operate it interdependently, and at relatively minimal costs.
Unfortunately, while blockchain solves many problems it falls short in other regards, and introduces others. For example, blockchain alone has proven to be inefficient at large scale use, requiring large amounts of power and getting congested to the point of non-usability. Security is also a concern, as in the sensitive and overwhelming nature of an interconnected world, even encrypted private keys alone would not be sufficient.
So, how exactly are IoT & blockchain and its alternatives working together to tackle the issues still facing the fruition of industry 4.0? The concept is young, but we can already see the idea of physical trust networks, the integration of the physical and digital worlds through IoT and blockchain, becoming a reality. True to the nature of technology, rapid advancements have already been made in developing blockchain alternatives, like applying the concept of a DAG (Directed Acyclic Graph, a blockless data structure) to the distributed ledger, which vastly improves transaction verification speeds and gets rid of miners, theoretically providing even more decentralization to some degree. These innovative breakthroughs are helping to solve logistical problems that would have otherwise taken decades or more to crack, but are not without fault, trading speed and other characteristics for vulnerable altruistic systems, central points of failure, and less established technology. It is important to consider the purpose of the project to know what kind of technology would be best suited, and to what degree.
There are many promising and prominent projects that are looking to tackle the issues of an interoperable world. Scalability, security, and data bottlenecks still stand in the way of the IoT future, but the race is on to solve these issues like never before. As projects like these get further into development and begin to deploy more real world use cases, we may start to see the beginnings an interconnected future, and thus the case that IoT and crypto could actually be the unlikely duo that brings society into a new industrial age, becomes increasingly compelling. Conversely, we could also ultimately see these ideas fail to take hold or succeed at all.
If blockchain and its alternatives are indeed able to overcome the issues stopping the internet of things from taking hold, then all of these technologies will converge and cause a tremendous shift in human life, ranging from the emergence of smart factories to the disruption of the data collection market, putting users back in control of their own information and privacy, while also allowing for the benefits of a fully connected society; and with less risk, all at the same time. It may have seemed impossible nearly a decade ago when bitcoin was invented, that it would join the ranks of AI, cyber-physical systems, and cloud computing to form the basis of a new kind of society, but it seems more and more likely every day. What exactly a future with all of these advancements working in tandem may ultimately hold for us, we do not know; but it is certainly an exciting thing to imagine.
—
Future Blok
Twitter: twitter.com/FutureBlok
Email: FutureBlok@gmail.com
