Blockchain In the Internet Of Things: 3 Possible Use Cases

  • 26 November 2018
  • Sam Mire

When it comes to the Internet of Things (IoT), there’s no debate: security is by far the greatest concern that needs to be dealt with as the world continues to embrace small, interconnected devices that tell a detailed story about their users and their activities. With as many as 50 billion devices projected to make up the global connected network by 2020, concerns about security for the trove of data they will collect and store is more than legitimate. Disconcertingly, last year, an estimated 500,000 devices were predicted to be compromised by malicious IoT hacks. History tells us that these attacks will continue to persist — 2016-17 saw a 600% increase in their prevalence — and with affordability and often weak security, the majority of these hacks will prove successful.

To solve this under-addressed problem, many have proposed the blockchain. Data stored and shared on blockchain-based platforms has proven far more difficult to siphon, with decentralization adding several layers of security that a single point of data storage cannot. While details remain to be hammered out, and scalability is an issue that must be addressed, tailoring blockchain technology to act as a lockbox for the nearly infinite amount of data constantly being derived from our smart devices is a no-brainer.

Blockchain in the internet of things - Practical use cases

Data Security

Blockchain use cases in the internet of things - Data Security

81% of surveyed risk oversight and corporate governance professionals believe that a serious breach of an unsecured IoT device will affect their business in the next two years. Yet only 28% of those same individuals say they include IoT risk mitigation as part of their third-party services. While we know that the growing abundance of remotely connected devices pose a great security risk, there seems to be little we can do to protect ourselves from compromise.

48% of organizations expected to integrate IoT into their operations by the end of 2018, and recent history has shown us that they should have security measures in place before they seek to harness the power of remote devices. In 2016, the Mirai botnet attack felled major players who rely on IoT to run their operations and keep data secure, with victims including but not limited to Netflix, Shopify, GitHub, SoundCloud, Twitter, and Spotify. That same year, two buildings in Finland suddenly had their heating shut off in the dead of winter by cyber attackers who penetrated their IoT network. And in 2017, an unnamed university sustained an attack that breached 5,000 of its IoT devices.

Maintaining a single point of IoT intelligence has proven fallible. IoT devices rely on that single point to make security decisions, so if that point of access is compromised, all of the devices are opened up to hackers. Blockchain alternatives allow IoT devices to employ alternate security measures, even allowing a network of devices to make “consensus” decisions about what “normal” looks like in a given network, and flagging abnormal intrusions based on such a baseline. Nodes that are behaving unusually can be quarantined, preserving the rest of the network from attempted breaches.

Companies Trying to Solve This Problem

  • IOTW Using a “block witnessing” protocol to enhance the security of IoT data sharing.
  • SmartAxiom – Leveraging blockchain powered edge security solutions to enhance IoT data security. 

Strengthening Data Validation Systems

Blockchain use cases in the internet of things - Strengthening Data Validation Systems

The value of Big Data rises by the day. While the global market for Big Data was worth approximately $34 billion in 2017, that figure is expected to nearly triple by 2027, when it is projected to be worth $103 billion. This is a logical trend, considering that data has come to play a role in everything from government planning to healthcare and beyond. However, the massive stores of data we continue to collect from sensors, the Internet of Things, computers, etc. is not worth a thing if it cannot be verified as accurate and useful.

“Found data,” or data that is simply observed and not collected under the strict rules of statistically-designed experiments, is becoming more prevalent, and this has and will continue to cause several problems. As one example, a 2009 model developed using 50 million Google search terms professed to predict weekly flu cases in the U.S. more accurately than the CDC. However, by 2011, the model began over-reporting flu cases by as much as double the actual rate. Utilizing applied statistics is critical to ensuring that we are making Big Data-derived decisions that are informed.  

Several startups have made it their mission to use applied statistical models along with blockchain technology to provide a measure of accuracy to Big Data. The blockchain can facilitate the sharing of raw data between parties to allow better oversight, ensuring that conclusions reached are not drawn from inaccurate, incomplete, or misleading data sets. Additionally, the ability of blockchains to communicate with each other may allow algorithms to flag statistical anomalies, such as a number of cases being reported that is larger than a certain population. 

Companies Trying to Solve This Problem

  • Ubirch  Platform that acts as a sort of notary service for IoT data validation on the blockchain.
  • SmartMesh Comprehensive blockchain IoT platform helping to verify and secure IoT data. 

Data Anonymization

Blockchain use cases in the internet of things - Data Anonymization

The penetration of the Internet of Things into our daily lives would be beyond belief only a decade ago. Smart homes now come equipped with internet-connected thermostats, entertainment systems, lighting, alarms, even door locks. Yet certain IoT devices — Amazon’s Alexa, for example — do not even offer a user interface by which to configure privacy and security settings. In 2017, it was revealed that even robotic vacuum cleaners may be “mapping” users’ homes and sharing those maps with the likes of Amazon, Apple, and Google. Meanwhile, insurers such as USAA and American Family have offered discounted rates in exchange for policyholders’ consent to install IoT-connected devices in their homes. There are plausible benefits to all this interconnectivity, but it also represents a fundamental rolling back of privacy, and the more “talking” between devices that goes on, the more access points that arise for hackers to exploit. 97% of surveyed risk professionals feared breaches of unsecured IoT devices could prove “catastrophic,” and with most of us having integrated IoT into nearly all aspects of our daily lives, concern about IoT security and data anonymity is understandably great.

The blockchain’s nature means that individuals who are part of a chain have a higher anonymity threshold. Aside from remaining more secure in the case of a breach, the greater control over personal information that blockchain tech provides could actually be used as a tool for companies to gain more data — albeit more anonymous data — for their own purposes. Providing a greater measure of security for users of IoT-connected devices could prove a win-win by which more trust is extended to data collectors and users feel that their identity and data is being secured.

Companies Trying to Solve This Problem

  • IoTeX – Privacy centric blockchain platform for IoT.
About Sam Mire

Sam is a Market Research Analyst at Disruptor Daily. He's a trained journalist with experience in the field of disruptive technology. He’s versed in the impact that blockchain technology is having on industries of today, from healthcare to cannabis. He’s written extensively on the individuals and companies shaping the future of tech, working directly with many of them to advance their vision. Sam is known for writing work that brings value to industry professionals and the generally curious – as well as an occasional smile to the face.