Using Blockchain with IoT: How and Why?

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Both IoT (Internet of Things) and blockchain are upcoming technologies that are estimated to overtake current traditional technologies. According to Gartner (R&A firm),

“The number of active connected devices was 8 billion in 2017 and is projected to cross the 20 billion mark by 2020.”

The fundamental problem where IoT is currently lagging in is the security of various computer systems connected over a hostile network.

So tech enthusiasts say that blockchain, being a distributed ledger and providing a decentralized network, may help in solving the security issues concerned with IoT. Deployment of IoT devices can be cumbersome. So here a distributed ledger can be used to provide IoT device identification, authentication and secure data transfer. The security breaches in an IoT device can be very dangerous in a few cases. For example if a self-driving car gets hacked, then the extent of harm caused is predictable.

How can we use Blockchain for IoT?

The major problem that IoT faces is the issue with security because of having an inherently distributed client-server model that uses centralized control for managing all the IoT devices as well as the data transferred over the network. According to Joseph Pindar, director for strategy in the CTO office at Gemalto and co-founder at the Trusted IoT Alliance (a nonprofit organisation that advocates the use of blockchain for securing IoT),

“IoT network has a single point of security intelligence that has the aggregation of all trust requests for making IoT data reliable.”

But this single point of security has compromised IoT security, leading to Mirai style botnet attacks. Mirai attacks basically mean that IOT devices are unable to make security specific decisions because of lack of central security node due to which they become prone to major security attacks.

So, according to Pindar, blockchain being a decentralized network will eliminate the presence of a single point of security and thereby, all the devices can have a consensus about which node is working in an unusual manner and quarantine any misbehaving node from the network.

Data is automatically stored in many locations and is always available to all the users of the system in a blockchain network.

A private permission based blockchain is used, which authorizes all users to access the data and since all the data on the network is signed, each device is accountable for its actions. Consequently, these features provide availability, accountability and adaptability to the network.

In other words, from a recent whitepaper from Siva Gopal at Tata Consultancy Services suggest four ways IoT can exploit blockchain technology:

1. Trust building

2. Cost reduction

3. Accelerated data exchanges

4. Scaled security

As i-Scoop puts it,

“Blockchain technology could provide a simple infrastructure for two devices to directly transfer a piece of property such as money or data between one another with a secure and reliable time-stamped contractual handshake.”

Why should we use blockchain with IoT?

The answer to the above question is listed as follows in points:

  • In simple words, blockchain is transparent. Transparency here actually refers to the fact that whatever security breaches or node flaws occur, they are reflected in the network and since all the users have access to the nodes, they can detect and quarantine the node.
  • The use of encryption and decentralized network ensures that data can be trusted by all the system users. Moreover, for overwriting any record, the private keys for write access should be given to the users, failing which no question of data corruption arises.
  • There are some blockchains like Ethereum which provide ‘smart contract’ facility which has a set of agreements that will be followed in case certain conditions are satisfied.
  • Because of the robustness of the security features provided by the blockchain, IoT systems like smart homes, which subsequently share a lot of personal data to other devices for better efficiency, function securely in such a widespread network of devices.

Real Examples of Blockchain with IoT Implementations

We have seen all the technical jargon but nothing can be convincing enough than to actually see real products that have been created so far;

There are several startups that are using blockchain to secure their IOT devices and here are a couple of solid examples. Check their websites (hyperlinked) for full details.

  • FILAMENT: It provides software and hardware solutions to machines so that they can interact and do transactions against blockchain. The hardware is a low cost Blocklet Chip which is an IoT Optimised Trusted Execution Environment. The software used is Blocklet, which is a secure contract system for embedded devices. Modern cryptographic protocols are used to ensure better security of the system.
  • XAGE: Using a blockchain secured IIoT (Industrial Internet of Things), it is a security suite that creates a communication system for cooperation, management and data exchange among people, devices and applications.

Tech enthusiasts see numerous other possibilities for securing IoT with blockchain in several other fields like manufacturing, industrialization, etc. and with top companies like Amazon recently entering the domain of blockchain, big developments can be expected in this field.

(This article was authored by Research Nest’s technical writer Meenakshi Mishra)

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