Rapid technological developments have resulted in the emergence of blockchain technology in the Internet of Things (IoT) devices. With the introduction of Web3, we can expect to see more use cases of blockchain development and IoT devices in the future.
The impact of blockchain on IoT is not limited to just the financial sector. It also extends to other sectors, such as healthcare, manufacturing, and supply chain management.
In this article, we will discuss blockchain technology, IoT devices, and the potential applications of these two technologies together.
What Is Blockchain Technology?
Blockchain technology is a distributed database that uses cryptography to secure transactions. It’s a public ledger that records all transactions made within the network. Every transaction is chronologically recorded into blocks linked together through cryptographic hash functions. Each block contains a timestamp, the hash of the previous block, and the list of transactions.
When a new block is added to the blockchain, it has to be validated by every node before being accepted. This process ensures that no one can tamper with the data stored in the blockchain. In addition, each block contains a reference to its predecessor so that you can trace back to the original source of information.
What Are IoT Devices?
As mentioned earlier, IoT stands for “Internet of things.” These devices are connected to the internet and can send or receive messages from other devices. They can also interact with other systems like computers, smartphones, etc.
IoT devices come in various shapes and sizes. Some examples include smartwatches, fitness trackers, smart thermostats, and home automation devices. The rise of IoT devices makes the internet more ubiquitous. This means that the internet is more accessible than ever before and more people can use the internet from any place.
Impact of Blockchain Technology on IoT Devices
Blockchain technology can be applied to IoT devices in different ways. Here are some examples:
Smart Homes
As IoT devices become more popular, they’re expected to play an important role in our homes. Smart homes are houses equipped with a variety of smart home appliances such as thermostats, lighting systems, and security systems. These devices communicate with each other using the Internet.
In this case, blockchain technology can help ensure that data is accurate and secure. There will be fewer vulnerabilities in your system, and you won’t need to worry about hackers stealing your data.
Healthcare
The healthcare industry is another area where blockchain technology can make a big impact. Healthcare providers collect patient data and store it in databases using IoT devices. However, these databases aren’t always secured.
As a result, patients’ sensitive health information could fall into the wrong hands. Using blockchain technology, healthcare professionals can create a decentralized database that stores all the data securely.
Tracking in Shipping and Transportation
Shipping and transportation industries use different tools to track their shipments. However, these tools may soon become outdated. More information will be needed to ensure that shipments get to their destination safely and securely.
By using blockchain technology in IoT devices, companies can utilize real-time tracking systems for better visibility. IoT devices that use blockchain technology can also provide information regarding optimal shipping conditions, routes, and other shipping details.
Smart Contracts
Smart contracts allow people to automate their business processes without going through intermediaries. They work by creating agreements that trigger actions when certain events occur. For example, a smart contract can automatically pay out a loan after a specified time has passed.
The introduction of blockchain technology in IoT devices paves the way for more smart contracts. As a result, this helps improve security, increase transparency, and simplify transactions.
Why Use Blockchain Technology in IoT Devices?
There are several reasons why blockchain technology and IoT devices should work together. Here are some of them:
Security
When you connect your IoT device to the internet, you expose yourself to cyber attacks, especially when you don’t secure your device. Hackers can steal your personal information, access your bank account, and even do other fraudulent behavior.
With blockchain technology, you don’t need to worry about someone else seeing your data. This is because other people can’t access identifying information about the users making those transactions.
Transparency
Another reason why blockchain technology and IoT should work together is transparency. When you connect your IoT device, you want to know what happens to your data. The information stored on a blockchain is entirely traceable since most blockchains are open-source software. Anyone and everyone can view its code without changing it.
Lower Costs
Using blockchain technology in IoT devices lowers costs since it makes things easier. It reduces the number of middlemen involved in the transaction process. This means lower fees for consumers as well as businesses.
The Bottom Line
Blockchain technology and IoT devices can potentially change how we live our lives. They can transform industries such as healthcare, manufacturing, and many others. While they still have a long way to go before they reach mainstream adoption, it’s already clear that they will be an integral part of our future.
