Will Blockchain Race to the Front of the Disruption Line in IoT?

By Arti Loftus September 12, 2017

The Internet of Things (IoT) is continuously transforming the lives of people through its innovation and intelligence.  From Smart Homes to Smart Farming, IoT is everywhere and expanding beyond our ability to measure it. 

According to Gartner, more than 20 billion things will be connected by 2020, and with all the potential commercial opportunities comes a deepening concern regarding security.

Given the pace of innovation and change, the current state of the Internet and centralized security models are unlikely to support the true potential of IoT and IIoT.

Given current architectural models, servers can become overloaded, endpoint security can be missed, leading systems more vulnerable to cyber-attacks. Blockchain proponents are suggesting blockchain is part of the answer, as this technology decentralizes security and helps prevent attacks. Decentralized control of transactions and sessions is more scalable that the traditional solutions in place today.

Blockchain, done properly, shields against data tampering, which prevents rogue devices and attackers from disrupting IoT systems.  Moreover, “Blockchain provides an assurance that the data is legitimate and the process is well-defined”, according to Ahmed Banafa, an IoT Expert, and lecturer at San Jose State University.

There are many applications of blockchain technology, including verifying the value of financial transactions, which is where blockchain began to develop years ago. 

Data flowing from sensors and embedded processors can change the way urban planners lay out Smart Cities, or IT teams support Smart Hospitals. Blockchain technology is a transparent singular system for various uses, with encryption enabling security and anonymity.  It provides an accurate data-set at all times, eradicating the need for a central governing authority.

In a recently published paper, Thomas Hardjono, of the MIT Internet Trust Consortium for open source software, argued that some parties could be allowed to sell anonymized data coming from IoT devices.  Receiving this data for outside agencies could create incentives for outside agencies to participate in blockchain technology.

Researchers at the University of New South Wales in Sydney are also taking some steps, though differently, towards blockchain based IoT security.  As per their model, blockchain-secured smart homes replace the entire conventional Internet router with high-powered miners (to manage local network transactions.  These miners would control the communication between home-based IoT devices and the outside world. 

Even if a small light bulb is captured by a botnet, the miner would infer this light bulb as an attacker, trying to disturb the outside server and hence block its packets.

Hyperledger Fabric is a blockchain technology especially meant for developing distributed ledger technology.  Though it isn’t the first one to release the code, as per the Linux Foundation spokesperson, it has achieved 1.0 status, which implies that it is the most mature of Hyperledger technologies.  Its software offers a robust architecture that allows components, such as consensus and membership services that can be plug-and-play.

This software is specially made in a way to meet the key requirement of transaction privacy through permission-based blockchains. The Umbrella Hyperledger concentrates on the business application of blockchain technology and is an open-source project. 

The group, founded in 2015, is the fastest-growing project in the history of the Linux Foundation according to Hyperledger Executive Director Brian Behlendorf.  This project has reached out to various industries in addition to IoT, industries which also are adopting IoT including healthcare.

Michael Hathaway, founder and CEO of Information Xchange, a technology and services company headquartered in Austin, Texas, is working with another Linux Foundation initiative, EdgeX Foundry, which is developing a framework for IoT and Industrial IoT edge computing and networking, and sees a massive opportunity to improve the effectiveness and economics of security using Blockchain methods.

“Northbound access is a challenge all IoT companies need to confront,” Hathaway said. “We’re deeply into the process now of analyzing the opportunity to store public keys on blockchain, as opposed to using a traditional trusted third party, and will be making recommendations based on the research and testing we have underway.”

Hathaway’s company has a longer history in the M2M and IoT industries than most, including contributing to early deployments in the energy, oil and gas industries.

“The interest in using blockchain is gaining momentum, whether in IoT networks or in larger telco networks, particularly as that world becomes more open with NVF and SDN transformations, more and more APIs, and new vulnerability points given the amount of integration and interworking now possible,” Hathaway added. “Industrial IoT will grow in complexity at the edge where a majority  of data transactions remain behind the firewall and off the public Internet. Security is still required in these applications. A local copy of a distributed Blockchain ledger can play a significant role in providing a unified method to manage access and security behind the firewall as well as in the Cloud.”

Blockchain can deliver a platform for IoT so that the devices can be connected reliably and shun the threats of plaguing centralized schemes.  In the field of agriculture and other manufacturing industries, progressive companies are already using blockchains to power IoT systems, when there is a need for remote sensors and automation.

According to Telstra, the Australian telecoms company, Smart Homes are the future port for blockchain technology.  They are using blockchain to secure Smart Home security by storing authentication data and biometrics on a private blockchain.

Currently, IoT deals with collecting the data from remote sensors, monitoring, and controlling it through automation.  In the future, the transition is towards a model of autonomous devices that interact with each other without human intervention. 

Blockchain has the potential to support this transition as it is based on M2M (Machine to Machine) interactions.  IoT, powered by blockchain technology, enables a low power and a secure network that can manage operations without centralized servers.

Though in the early stages of this technology, developers and innovators are still finding out the best possible ways to implement it and spread it across the IoT World.  It is likely to say that blockchain will become the most scalable and sustainable approach to securing all those billions of endpoints by 2020.

Arti Loftus is an experienced Information Technology specialist with a demonstrated history of working in the research, writing, and editing industry with many published articles under her belt.

Edited by Ken Briodagh

Special Correspondent

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