Making data-driven decisions can help you obtain a competitive advantage—and when so much is at stake, the trustworthiness of that data is critical. That's why blockchain and IoT are increasingly becoming part of the data discussion across many sectors.
The Internet of Things (IoT) has revolutionized how enterprises make crucial decisions by harvesting information from new and previously unexpected sources. Machines at the edge, embedded with IoT sensors, relay real-time information, from which analysts can extract comprehensive intelligence.
Though the IoT holds tremendous potential to make data-driven decision-making a reality, even the best IoT systems can be hampered by slow, manual security protocols that limit their potential. The sheer number of devices at the edge, coupled with external vendors and unknown players controlling them, adds a complication: a lack of trust. Blockchain security helps deliver that necessary trust to unleash the full power of the IoT.
A powerful combination
Storing information in databases is traditional, and it works, but the centralized nature of that information can foment trust issues. Blockchain—a distributed, immutable, transparent, secure and auditable ledger—presents an alternative method of recording, storing and transmitting information. If one were to assume that every transaction was in a ledger, every page of that ledger would form a block. Each block is chained to the previous block and contains information about the provenance of that data and where it belongs in the long blockchain. One key advantage of blockchain security is that information is decentralized, and parties can only add on to a blockchain; they can't change existing data.
Blockchain security provides a more efficient infrastructure for IoT devices because its immutability and transparency increase trust in data generated at the edge. Because information is distributed across a network, no single user can be a bad player without immediately suffering repercussions.
Another advantage of blockchain is anonymity. Blockchain transactions can be recorded with unique identifiers that decentralize and anonymize record-keeping. This is an especially useful feature when working with sensitive data, such as patient health information. Patients often go home from hospitals wearing devices that record sensitive health data; real-time transmission of that data needs to be secure, trusted and anonymous. Blockchain and IoT devices can increasingly fill that role as part of the healthcare sector's digital equation.