Accelerating IoT (Internet of Things) Adoption with Blockchain

Published : Dec 30, 2020

Blockchain and IOT

  • The Internet of Things (IoT) links users, locations, and goods, and hence, creates possibilities for generating and capturing value. Embed into physical objects, IoT-enabled chips, sensors, and actuators, each transmits data to the IoT network. The use of this information by IoT analytics tools further turns ideas into motion. Thus, it results in influencing existing market practices and creating new ways of operations and processes. There are some technological and safety issues, however, that remain unaddressed. In this article, we find out how blockchain app development may provide alternative solutions to address various IoT adoption-related challenges with efficiency. 

    Internet of Things (IoT) | Challenges

    IoT security is a big problem that has impeded its large-scale implementation. Moreover, IoT systems suffer from security flaws that make Distributed Denial of Service (DDoS) attacks an easy target for them. Vulnerable IoT devices provide a convenient target for cybercriminals to leverage the lax security defenses to hack them into launching DDoS attacks. 

    Another challenge is the scalability of new IoT networks. As the number of devices connecting to an IoT network increases, it can turn into a bottleneck for existing systems to authenticate, approve, and connect with multiple nodes in a network. It will entail massive investments in servers that can support a vast volume of information exchange. Otherwise, if the server is inaccessible, the entire network can go down.

    Why Blockchain Technology 

    Blockchain is proving another revolutionary technology with the potential to address constraints and challenges of IoT like security and scalability. Its features like immutability, traceability, and distributed infrastructure can remodel the way IoT models operate.

    Refer to this guide for more comprehensive details on blockchain technology and IoT integration advantages.

    Addressing IoT Challenges with Blockchain

    In the event of an attack by cyber hackers, the IoT network will handle data transfers through several computers owned and operated by numerous entities, making it impossible to determine the cause of any data leakages. Also, the IoT contains a wide array of data, and the ownership of the data is not necessarily transparent for many parties concerned.

    Distributed Ledger

    In a blockchain scheme, the public ledger is tamper-proof, and it eliminates the need for trust among the parties concerned. Therefore, it does not require a single entity to manage an overwhelming amount of data produced by IoT devices. 

    Security Mechanisms

    Blockchain technology development to build the underlying infrastructure that stores IoT data adds another layer of authentication that hackers need to bypass to access and compromise the network. 

    Blockchain offers a much more rigorous security level that makes it nearly impossible to overwrite stored data.


    By enabling anybody with permission to join the network and trace stored transaction, it offers accountability. It provides a precise means of finding a particular cause of any data leaks and quickly taking corrective action.

    Also, Read | Blockchain and AI (Artificial Intelligence) for IoT (Internet of Things)


    Blockchain enables billions of connected devices to execute transactions while establishing communications with each other. Distributed ledger infrastructure offers a feasible alternative to facilitate the execution of a vast number of transactions as the number of interconnected devices increases.


    Blockchain will allow IoT businesses to lower costs by removing the transaction overheads linked to IoT gateways. It does so by offering a way to enable trust among stakeholders.

    Smart Contracts

    A smart contract is like an agreement between two parties stored and operated on a blockchain platform. It further facilitates stakeholders to conduct business contracts based on the fulfillment of certain conditions by involved parties in a transaction. For instance, smart contracts can automate the approval and execution of payments without intermediaries. But, parties must meet the conditions for the provision of service.

    Applications of IoT and Blockchain

    Transportation | Freight Management 

    Moving freight is an intricate procedure involving multiple groups with various goals. An IoT enabled-blockchain platform can store various measures accessible to stakeholders. It includes factors like temperature, location, and shipping status of containers as they travel across. Parties can use this immutable data on the platform and take steps to efficiently and securely transfer goods.

    Component Tracking  

    For both safety and regulatory enforcement, the ability to detect components that go into an airplane, vehicle, or other items is crucial. Stakeholders can have provenance details of parts over the lifecycle of a device provided by IoT records stored in the distributed blockchain ledger. It is safe, convenient, and cost-effective to exchange this data with regulatory agencies, shippers, and producers.

    Predictive Maintenance

    For vital machines and their upkeep, IoT devices control the state of safety. Blockchain gives a tamper-free controller of operating details and the resulting repairs from generators to elevators. For predictive maintenance, third-party repair partners may record and track their work back on the blockchain-powered database. For enforcement audits, stakeholders can exchange operating reports with government agencies.

    Considerations Relating to Adoption

    The security architecture of IoT models renders them vulnerable. It provides a single point of failure, which an issue with current IoT systems. By decentralizing decision-making on a decentralized network of devices based on consensus, Blockchain solves this issue. There are, however, three key obstacles to remember when developing the architecture for IoT devices in combination with a blockchain ledger:


    Scalability One of the main problems currently facing IoT is one of scale - how to manage the vast volumes of data gathered by a wide sensor network and the likely lower speeds or latencies of transaction delivery. Defining a simple data model in advance will save time and eliminate problems when placing the solution into production.

    Network and Transaction Privacy

    Public blockchains do not conveniently grant the anonymity of transaction records in the distributed ledger for a network of IoT computers. It is possible to apply transaction pattern analysis to draw inferences behind shared keys of users. To see whether hybrid or private blockchains could best fit their requirements, companies could analyze their privacy requirements.

    Also, Read | Public and Private Blockchain | an Analogy to Help You Choose the Best

    Integration with Sensors

    Potentially, messing with the proper calculation of the conditions to make a transaction often compromises IoT sensors. Ensuring their security from external interventions while providing a secure data recording and transaction environment is essential.


    Although blockchain technology and IoT await mainstream adoption, they show significant potential. Established Businesses are increasingly focusing on developing blockchain technology-based PoCs and use cases that incorporate the two innovations. Explore how they together provide a means of reducing protection and related business risks.

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