By providing a secure mesh network, blockchain can deliver a platform for IoT to interconnect reliably and avoid the threats that plague central server models.
There are companies already using blockchain to power IoT systems, especially in the agriculture and manufacturing industries where there is a need for remote sensors and automation.
IoT, powered by blockchain technology, enables a low power, secure network that can remotely manage physical operations without centralized cloud servers.
The manufacturing industry is moving to an entirely virtual world across its lifecycle, ranging from product development, customer demand monitoring to production to inventory management.
As devices and systems become more interactive and intelligent, the blockchain can serve as a plant level, regional level and global supply chain level ledger. This will dramatically cut costs and drive more efficient just in time (JIT) processes enabling better usage of plant capacity and improved operational efficiencies.
The Connected Vehicle enables the car or truck to behave as a giant Smart App. With the passing of every year, vehicles have more automatic features builtin – ranging from navigation, roadside assistance etc.
Blockchain will enable these devices to be tracked on the digital mesh thus enabling easy inter vehicle communication as well as automatic tracking of fleet insurance policies, vehicle registration renewals etc.
IoT + Blockchain = Connected Transportation. A range of scenarios can be imagined around a connected mesh of vehicles that exchange everything from traffic information to avoiding gridlocks and bottlenecks. Extending this to global trade, this mesh can incorporate shipping, air freight as well as ground transportation to track shipments.
Smart devices are already being used to track the health of bridges, roads, power grids etc. Blockchains can be used to interconnect these to share efficiencies and to conduct maintenance, forecast usage trends for power usage, pollution etc.
Another key area of usage would be to help remote areas such as forests to monitor natural incidents and to prevent catastrophic occurrences like large scale forest fires or farm infestations by blight etc.
Banks could use Blockchain backbone to track IoT enabled devices like ATM machines, remote tellers to conduct maintenance.
Insurance companies which have already started deploying drones to verify property claims in remote areas can use the Blockchain to validate and verify claims.
Using sensors deployed on both homes and commercial buildings helps with automated home and office monitoring. The usecases will diverge across both areas but many can be built on having a foundational distributed ledger capability.
Blockchain based cryptocurrencies like Bitcoin enable two business capabilities at a high level – a) transfer of cryptocurrency and b) business rules that specify when the payout has to happen – typically once conditions that have been met – which satisfy fulfillment of contractual terms.
These rules are termed “Smart Contracts.’ Smart contracts are applicable across all of these business areas and can be used to keep track of business rules and take actions based on thresholds that have been met or have been breached. E.g A driverless vehicle that has failed an inspection can be grounded, non payment of home owners insurance can trigger an alert to the homeowners housing society etc.
Retailers are already using IoT devices and endpoints to help across the business lifecycle – ranging from the shop floor, to tracking product delivery to store, to understand their customer traffic patterns, wearables etc. The vision of the Connected Store with IoT enabled shelves, an ability for customers to perform more actions using smartphone apps to reducing checkout times with self checkout etc are all taking place.
The Blockchain can augment all of these usecases by providing the critical link between retailer and consumer in a way that it automates away the middle man- be it a credit card issuer, or a central server. For instance consumers can store their product preferences, sizes in a Blockchain and the retailer can access these in a seamless and secure manner.