For businesses around the world, it is important to know that there is an intricate relationship between blockchain and the Internet of Things (IoT). Business entities that make or use IoT devices may find solutions that utilizes blockchain technology. When the two are intertwined, the IoT device can leverage on cryptographically secured database and records can be protected against alteration and theft. The combination can build transparency and accountability while helping reduce workplace mismanagement, overhead expense and business unpredictability through its servers. This process also eliminates the need for a centralized system, which often times can be bureaucratic and difficult for businesses.
With blockchain empowering the interconnected IoT devices to take part in secured data exchanges, businesses can use blockchain to manage and process information from devices that has radio-frequency identification-based assets, machine readable QR code etc. The blockchain-powered IoT devices devices will be able to transfer the blockchain-based records to renew contracts or validate work. For instance, if an IoT enabled and RFID tagged device with geographic location and confidential data moves to another geographical point, that information will be automatically stored and updated on a blockchain ledger while necessary actions are taken automatically, notifying stakeholders of data if necessary.
Blockchain enabled IoT devices can also eliminate the IoT gateway necessary to establish network among the cloud and devices. Removing the third party can enable peer-to-peer contracts and data sharing with perhaps the best security we can imagine. Also, this process results in the digital ledger eliminating any extra time required for synchronizing the device, processing and harvesting information.
With blockchain enabled IoT space, devices and appliances can physically transact and communicate as parties without fear of security flaws. Contrary to a traditional business where transactions require a number of verifications, blockchain does not require peer reviewed proof or any authentication. For example, Party A may not know or met Party B personally or physically, the fact that there is a stamped record of online transactions and data sharing within the blockchain’s ledger solidifies the business transaction. This in turn, enables individuals and organizations to fully utilize the technology with ease and confidence.
Blockchain enabled IoT devices can also upgrade supply chain network accordingly by tracing the tagged items as they move along different points in the process, with pretty good accuracy. The precise product data and solid traceability of relevant information along supply chains, make auditable records of the products and help organizations trace back history of records without going through papers of records like we do it in the traditional sense.
Rather than finding paper trails for identifying place of origin, IoT devices can validate each product’s physical location through a virtual token that provides relevant data like authenticity and origin of product.
Because blockchain enabled IoT devices are secure and effective when implemented, any businesses that deal with IoT can certainly elevate business productivity by adopting and implementing blockchain to their enterprise solution and eliminate bottlenecks for good.