Top 3 IoT Opportunities For Blockchain Technology
There are tiers of what people think of when the world ‘blockchain’ comes to mind. Firstly, there’s money and transactions being moved and transacted across a ledger of some sort like Bitcoin has revolutionized. Then there’s a smaller subset of people excited about smart contracts executing on platforms such as Ethereum and Lisk.
What might play an even greater role in the mass adoption and proliferation of blockchain technology in the future could be how it plugs into and streamlines how people and devices interact with one another, otherwise know as the Internet of Things (IoT). One such company forging ahead into the world of IoT blockchains is IOTA, with an innovative new technology known as the Tangle ledger.
Focusing on the machine economy, IOTA’s Tangle ledger allows devices to settle transactions with zero fees. This allows devices to interact with the blockchain on-demand and in real-time without racking up potentially massive and prohibitive transaction fees such as what’s seen on other blockchains like Ethereum with their gas costs.
This innovation enables companies to go from micro-transactions all the way to nano-transactions. This is where the technology really shines as it allows both really small bits of data accessible for blockchain usage and also for non-profits to be able to leverage the blockchain effectively.
Speaking with IOTA’s founder David Sønstebø, he expressed excitement for these three market opportunities lying immediately ahead.
1. Bandwidth on Demand
Most people think of their phones that they pay for on a monthly basis or where they will go to a local convenience store and fill-up their prepaid balances. These are easy enough concepts to consider as we are all used to such processed, however enabling microtransactions on a blockchain would allow a telecom company to charge and deliver bandwidth for consumers on demand. This saves the consumer money and allows the telecom company to more accurately assess and price the demands put on their network.
“IOTA plays two roles here, first is the obvious micro-transaction trade part, the other is Data Integrity on the ledger. Due to IOTA having no fees you can actually pay in real time for the exact amount used.”
2. Smart-Grid Management and Real-Time Sensor Data
Self-balancing electric grids could be established, tracked and run using micro-markets on top of IOTA. A device could bid for electricity from the grid and pay a market price respective to its acute need and as well as the demand on the grid. The data received from sensors within the energy grid or any type of sensor for that matter are recorded and logged on the blockchain and can be interpreted in near real-time. With industries being built around this idea, the data integrity associated with blockchain ledgers is crucial, which Sønstebø addressed in a recent blog post entitled “Honest Data.”
These applications of IoT blockchain technology range from existing fossil fuel plants, to cutting edge sustainable energy solutions.
“What IOTA is primarily meant for is micro-transactions between devices such as solar panels selling electricity to computational stations who sell analytics services to sensors who purchase bandwidth from gateways. This enables a true Machine Economy where a device that is in acute need of electricity or other resources will bid higher to get priority.”
3. Distributed Computation and Storage
With the volume of computational power held just by everyday consumers around the world, it is staggering how much of it goes unused while people let their home computers, laptops and even smartphones operate idle for many hours of the day. IOTA’s technology could enable micro-transactions for the computation and storage of data.
Businesses could harness a huge volume of power and storage capacity in a decentralized manner and with the proper redundancies, could have even more security than traditional enterprise options. For the users to opt-in to let their devices be used in this system, there’s potential for them to earn passive income while they’re not even actively using their devices.
Obviously, one blockchain doesn’t solve all of the world’s biggest technological problems. Other solutions like Bitcoin, Ethereum, Rootstock, Monero and others will have very specific technological benefits to solve issues that have remained persistent for businesses and people.
With massive efficiency gains made possible through the effective usage of IoT concepts, pairing with IOTA’s technology and others like it will enable some emerging industries to flourish and out-compete many of today’s behemoths.