The world is witnessing a rapid proliferation and adoption of technological innovations across multiple industrial sectors. An entire evolution is evident across domains that utilize interconnective devices through various means. Internet of Things, or IoT has gained global momentum harnessing internet connectivity and Web 2.0. However, what’s interesting is the fact that the field will soon undergo another transformation with the advent of Web 3.0 stemming from blockchain-powered innovations like DeFi or NFTs. BoT, or the Blockchain of Things, is arriving sooner than expected.
What is The Blockchain of Things?
Blockchain of Things is the next upgrade to the current existing Internet of Things. The solution provides an enterprise-grade security boost to IoT with the incorporation of cryptographic blockchain technology.
Several experts from the tech industries believe that BoT is the next step in the evolution of IoT, and will likely replace IoT completely by the upcoming 20-30 years.
BoT: How It Works?
Blockchain technology addresses one of the main challenges that act as a setback to widescale IoT implementation- security. The use of sensors and associated infrastructure pose a security concern for the IoT ecosystem, especially with the increasing number of interconnected devices. Blockchain technology fortifies the network of information within the IoT ecosystem, reducing the chances of a data breach.
The shared ledger technology of blockchain in combination with IoT facilitates machine-to-machine transactions. The transactions are documented in a common database which is further verified by separate sources and distributed to each node afterward. Blockchain-based IoT offers several advantages in addition to permitting smart devices to function in an autonomous fashion, without any central authority. The technology also helps in tracking inter-device communication.
Smart Contracts: Practical Use in Different Industries
Blockchain-IoT integration has been successful across multiple sectors, including Automotives, Agriculture, Banking, and the Finance Sector. Smart contracts utilize blockchain technology to integrate the same into the IoT ecosystem across smart homes, logistics and supply chains, and more.
A smart contract gets automatically executed on satisfying the predefined criteria- thus eliminating the need for a supervising authority. They also help enterprises in reducing expenses on account of IoT device maintenance and data transfer. The absence of a centralized repository for data strengthens the network security, safeguarding the ledger from cyberattacks. The elimination of gateway or intermediate devices for data transfer helps in saving time by speeding up data processing.
The Blockchain Effect: Improved Security
Poor grade client/server architecture and access controls make IoT ecosystems vulnerable to cyberattacks. The distributed security architecture is effective against Distributed Denial of Service(DDoS) attacks. They the rapid overflow of internet traffic from overloading the target or its adjoining infrastructure. The P2P protocol independently secures devices within its network.
BoT Value Addition
A blockchain-IoT ecosystem will not cease to function if an underlying device, network, or server fails. The decentralized ledgers enable high-security data encryption, authentication, authorization, and distribution.
BoT associates the actual value of physical objects in the digital realm, facilitating a proper evaluation of objects which can be used afterward for value exchange. In other possible implementation scenarios, the BoT can mold intangible properties(user information, data usage, etc.) into practical and transparent determining parameters, contributing to a reliable data trading platform. The users can also adjust their usage data and avail the generated benefits, safeguarding personal privacy throughout the process.
Blockchain incorporation is the next logical step in IoT technology. The decentralized nature of blockchain solves the challenges faced by IoT at present, including concerns rising from device security, personal privacy, demand on server architectures, communication compatibility, and cross-subject collaboration. BoT will be the successor, ushering technical innovations and startups to a new age of growth and prosperity.