Why the Future of IoT Needs Blockchain at the Edge
Jeriel Isaiah Layantara
CEO & Founder of Round Bytes
The Internet of Things (IoT) is radically changing the way we interact with our surrounding environment, from smart homes to large industrial facilities. Billions of interconnected devices are now responsible for the collection and exchange of large quantities of data that drive unprecedented levels of automation and efficiency. Unfortunately, this extreme level of connectivity creates severe vulnerabilities. Data management using traditional centralized methods is a profitable opportunity for cyberattacks and it raises questions about data privacy, integrity, and ownership.
We need a solution: the combination of blockchain and IoT edge computing. This is why we require a new approach. It is called a hybrid of blockchain (the foundational technology of digital currency) through IoT edge computing (the design where devices ingest and process data locally). When both of these technologies come together, they create an incredibly secure and transparent network.
The IoT concept is great: devices talking, completing tasks autonomously, and providing real time information to enable you to make better decisions. Just like smart sensors letting you know when your machine needs to be repaired; or your smart home adjusting lights the moment you walk into the room.
But with all of this connections comes the issue of security. While the IoT shows some promise, many of these systems still transmit their data to a cloud based central server. It’s like having all of your important papers in one main office. If that office gets hacked, everything is compromised. People have concerns about their own privacy, the ownership of the data, and whether or not a remote attacker can interfere with it. Realistically, with billions of devices in existence in the universe, it is difficult, if not impossible, to protect them all with antiquated protections.
Edge Computing: Getting Smart Right Where It Happens
The cloud is slow and has issues, and we solve that problem with edge computing. Exactly how? The devices perform their own thinking and data processing where the devices are located, at the "edge" of a network, or fairly close to it.
This strategic shift offers significant advantages:
- Super Fast: Data is not travelling very far to be processed. Reaction times can be instantaneous, which is critical for things like self-driving cars or factory robot arm movements.
- Saves Money: Data along with good old-fashioned cash, is not being transmitted over the internet, reducing costs.
- Always On: Edge devices are capable of completing tasks even if disconnected from the primary cloud. This is necessary for mission critical systems.
- More Private: Sensitive data may be processed "on site." This limits or eliminates private data leaving your home or factory network.
While edge computing improves speed and some privacy, it won't completely protect who you are able to trust or how to prevent someone from covertly changing data. Enter Blockchain.
Blockchain: The Unbreakable Promise of Trust
Blockchain is a really smart way to keep track of data. Understand blockchain as a unique digital notebook. When something happens (transaction, etc.) it gets written in a “block”. Every block links to the last one in the “chain” securely. Once something is written in the notebook and confirmed by all, it cannot be deleted or altered. Very honest and trustworthy.
Key characteristics of blockchain that make it revolutionary for IoT:
- Decentralization: Prior centralized solutions had one computer that the whole system relied on. Blockchain shares the notebook with everyone in the network so if one link snaps, the others will keep operating. It has huge safeguards against attacks.
- Immutability: When data goes to blockchain, it is permanent. This gives a perfect history of everything which is good for verification in terms of whether data is authentic.
- Transparency (with Privacy): Everyone can see something happened (or it didn’t) on the blockchain, but some clever coding keeps personal information private. You can see that a transaction occurred, but you don’t see who it was or what it was detailed, unless you are supposed to.
- Security through Cryptography: Each block has a unique code that links it back to the last block. If anyone tries to modify any data, then the code is broken, and immediately the entire community knows something is wrong.
- Smart Contracts: If you think of smart contracts as digital agreements that you can program and run automatically in a decentralized network, you're not far off. You'll write the rules into the code, and when the rules are met, the blockchain code will execute. No middleman needed.
The older blockchain systems had issues such as speed and energy inefficiencies which meant they were not ideal for small (to wrap up) the new smart ways of achieving blockchain capabilities are providing the best alternative options.
How Blockchain and IoT Edge Create a Secure Network
The real magic happens when blockchain and IoT edge computing are combined! They complement each other's weaknesses, resulting in a strong, secure, and very efficient network.
Here is how this powerful combination works out:
- Think Local, Trust Global: Edge devices perform their fast, local computations on the data, and then take the important verified information (such as confirmed sensor reading or successful device action), and write that onto the blockchain. So, raw, heavy data stays from the local environment (for speed and responsiveness) while only the important data with trust value enters the immutable blockchain.
- Decentralized Authentication: Blockchain provides a transparent and secure record that enables every device and user to authenticate their identity. Each IoT device can have its own identifiable digital ID on the blockchain. They then use specific "smart contracts" to automatically authenticate the identity of devices and users, thus allowing only the devices and users already authorized by the owner of the network to connect to it. Therefore, it removes the risk of a centralized server using username and password as the only authentication mechanism.
- Data Integrity: When a piece of data is processed and authenticated at the edge, it can be placed on the blockchain as an immutable digital "fingerprint." Thus creating a permanent record of that data value and once recorded on the blockchain the fingerprint cannot be changed. Later if someone were to change the data value, the fingerprint would no longer match and it would be apparent there was a tampering with the original data.
- Automated Trust with Smart Contracts: Smart contracts on the blockchain can facilitate devices & systems across the IoT to fulfill agreements, eliminating the need for human involvement. An example may be an IoT smart contract with many sensors at the edge, and once everything operates correctly, the smart contract is able to send payment to the delivery truck as long as the edge sensors confirm the goods arrived without damage. This increases production and is more reliable.
- Enhanced Privacy: Sensitive raw data can remain on an edge device and process locally. The only thing that can post to the blockchain is summaries and verified changes. This allows less of your private or business data to traverse the Internet which is safer.
- Resilient / Adaptive: The distributed nature of blockchain technology merged with edge computing forms a more resilient network. If one segment of the edge network fails, there are other segments that are still accessible to perform the needed task. The entire network is also capable of adapting and evolving, and the blockchain is still able to verify and maintain integrity.
Real-World Impact and Future Prospects
The use of a combination of blockchain and IoT edge computing is set to impact several sectors:
- Smart Manufacturing (IIoT): Ensuring secure communication between machines, accurately tracking products in the supply chain, and automating quality checks.
- Smart Cities: Secure management of public services, improved traffic flow, and responsible management of local power grids.
- Healthcare: Protecting sensitive patient data, secure sharing of health records, and authenticating medicines.
- Logistics and Supply Chain: Providing end-to-end transparency and traceability for goods, preventing counterfeiting, and automating payments upon delivery confirmation.
- Autonomous Systems: Ensuring the authenticity and integrity of data exchanged between self-driving vehicles, drones, and their environment.
The future of the connected world hinges on building trust and ensuring the security of our interconnected devices. The uniquely powerful combination of blockchain and IoT edge computing offers a powerful, flexible, and clear means of achieving this. By moving away from legacy centralized architectures, we don't only address current issues; we create a digitally secure, efficient, and trustworthy future for everyone. We have only just begun, and exciting new opportunities from the combination of blockchain and IoT edge computing breeds the potential to fundamentally redefine the world we live in.
