Use Cases of Blockchain in IoT
IoT has been successfully proving itself in enterprises that has adopted it. Generally, all IoT devices even the nearby ones are connected to each other over the centralized internet. The diversity of ownership between cloud and IoT devices, brings complications in device to device communication. Hence a centralized network cannot guarantee complete interoperability.
The solution to this is to decentralize the IoT network. Adopting a peer to peer communication for processing the transactions between devices prevents failure in a single node and reduces the cost of installation and maintenance of centralized networks. However, a decentralized network has its own challenges and one of them is security in transactions. So to overcome such challenges, enterprises are adopting a new technology with IoT called the blockchain.
Blockchain is a technology capable of maintaining a distributed ledger in a network. It has already proved itself as a leading security provider in the financial services via cryptocurrencies like Bitcoin.
With security and autonomous competencies, blockchain in IoT, helps in exchanging information between devices in the network exactly like the way it does financial transactions in the bitcoin network. Each node of blockchain assures security of each transaction taking place.
Implementation of blockchain in order to leverage other technologies is called as Hyperledger Fabric enabling IT in using blockchain to gain better security, dependency and clarity.
Some of the use cases of Blockchain in IoT are:
#1 Blockchain in IoT in Business Contracts
Confidentiality is a key requirement in business agreements but at the same time, in certain scenarios, the business agreements should be available for all the business parties on the ledger. Blockchain makes it possible to keep those business contracts under privacy policies and at the same time, makes it discoverable whenever required with components like Multi-sig contract activation, Multi-sig contract execution, Discoverability, Atomicity of contract execution, Contract to chain-code communication, Longer Duration contract, Reuseable contracts, Auditable contractual agreement, Contract lifecycle management, Validation access and View access.
#2 Single Contract in a Single Business
From the time, any business deal gets cracked till the time it is finally settled down, all the participants use the same kind of contract. The contract used by the front office to crack the deal is then used by the middle office and later the same is used by the end office while confirming the business. In case of multiple businesses, the contract is broken down into sub-contracts which is always connected to the main contract.
#3 Head-on Communication
When any company takes a voluntary decision to raise certain amount of money for its rights issue, details of the particular offer need to be informed to all its shareholders including the mediators. The decision of each shareholder is processed in real time and if any shareholder sells its share, the security depository records the share and update it in the name of its new owner.
#4 Delivery Chain in Manufacturing
In any manufacturing supply chain, the sub-suppliers send the parts to the suppliers who assemble and then send them to the final assemblers who assemble them again. In this supply chain, every supplier or assembler need to have track of each number of part they has been put together in the network. Blockchain fabric enables this by providing a protocol with components like Payment upon delivery of goods, Third party Audit, Obfuscation of shipments, Obfuscation of market size, Validation Access, View access, etc.
#5 Availability of Assets
Enterprises exchange their available assets with unavailable assets. As the accurate assets are not always available in the market, hence a chain network connects the buyers with the sellers. This chain finds out the appropriate match for exchange of assets and allows the execution of the transaction.
#6 Partition of responsibilities between asset owners and third party managers
Issuers send notifications about the payments of the assets directly to the asset owners. The assets are always owned only by its asset owners as the third-party asset managers work via the asset owners. The asset owners allow the third-party managers to work on the assets without worrying about the duties of the asset ownership.