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When Blockchain and IoT Work Together: Reappraising the Promises and Pitfalls
Understanding the Convergence and Moving Past the Hype to See Real Value and Growth Opportunities
24-Dec-2021
Global
Market Research
K675-01-00-00-00
IT04453-GL-MT_26142
This study serves to explain how Blockchain and IoT can work together, what each technology is, how it works, how they integrate together, and example use cases.
• Blockchain and IoT represent two collections of technologies with tremendous potential to improve and optimize businesses operations and daily life, but despite the heralding of a new era the realized results have fallen short. Innovators have been combining these two groups of technologies in novel solutions, searching for ways to monetize existing capabilities and divining what customers may actually purchase. Service providers are exploring capabilities for these solutions to add value across applications, in use cases where stakeholders need a way to smooth transactions in situations that lack complete trust.
• As IoT connectivity progresses to support long range applications and high bandwidth applications, IoT can unleash waves of process optimization. While IoT is adding an identity and connectivity to billions of devices, simultaneously making it easy to measure and manage functions as well as making them vulnerable.
• Blockchain can be imagined as simply a way to find agreement with strangers. Or put another way, blockchain is a collection of technologies that secure an exchange of value without a central point of control. It minimizes the capability for any one actor behaving maliciously or deceptively to control the trusted chain. The blockchain’s goal is to reach consensus without a single central authority.
• Blockchain technologies can complement IoT deployments by adding a layer of verifiable trust to recording and exchanging data and securing devices. Integrating blockchain-enabled solutions into distributed (and/or multiparty) systems can mitigate security and operational risks, through identify verification, device authentication, and data transparency. Applications leveraging both IoT and blockchain can streamline business processes and transactions, optimizing and automating contracting terms and transactions with a consensus record that does not require a third-party approval.
• The IoT services ecosystem is fragmented but interdependent; service providers frequently work together across functions. The blockchain solutions landscape is also fragmented, with another highly complex value chain that requires proficiency across multiple domains.
• The market landscape for blockchain-enabled IoT solutions is fast-moving, with startups pivoting fast and established incumbents entering and exiting the space votsrelatively quickly. After much hype, enterprises are figuring out where blockchain in adds more value than a standard database.
• Solutions in these segments usually involve complex and long value chains, with many multi-party systems. Service providers need to blend industry knowledge and technical expertise as they manage and evolve ecosystems. With 5G connectivity and a rising wave of IoT devices visible on the horizon, stakeholders will need to collaborate in order to standardize and broaden the appeal of these types of solutions.
• Fundamentally the market for solutions and services blending IoT and blockchain is nascent, with definitions and businesses models blurring and changing quickly.
Author: Nick Baugh
Why Is It Increasingly Difficult To Grow?
The Strategic Imperative 8™
The Impact of the Top Three Strategic Imperatives on the Blockchain-Enabled Internet of things Space
Growth Opportunities Fuel the Growth Pipeline Engine™
Scope of the Study, in Regards to Blockchain
Scope of the Study, in Regards to IoT
Inside this Study, Much Enthusiasm in a Hazy Landscape
Definition of the Internet of Things (IoT)
Why Does the Internet of Things Need Help?
Why Does the Internet of Things Need Help? (continued)
The Needs of IoT Use Cases
IoT Connectivity Options
IoT Connectivity
Definition of Blockchain
What Problems can a blockchain-based Solution Address?
Basics of Blockchain—Terminology
Basics of Blockchain—Terminology (continued)
Basics of Blockchain—Terminology (continued)
Basics of Blockchain—Nodes in a Decentralized Network
Basics of Blockchain—Building the Chain
Wide Potential for Blockchain Applications
Limitations of Blockchain Solutions
Various Types of Blockchains
Different Types of Blockchains
Variety of Enterprise Blockchain Platforms
Leading Platforms for Enterprise IoT Blockchains
Common Modifications of Leading Platforms
How Blockchain and IoT Can Work Together
Building Trust With Blockchain
Organizations Need Ways to Ensure Verifiability
What Blockchain-enabled IoT Solutions Can do in the Enterprise
Benefits of Blending Blockchain and IoT
How IoT and Blockchain Interact
Blockchain and Iot Integration Options
IoT and Blockchain Integration Considerations
IoT and Blockchain Integration Considerations (continued)
Challenges in Developing Blockchain-enabled Solutions with Enterprise IoT
Challenges Bridging Enterprise Networks and Blockchains
What It Means—Tremendous Potential
What It Means—Tempering Overenthusiasm
Limitations of Blockchain-enabled IoT Solutions
COVID Derived Challenges
Services Landscape
Services Landscape (continued)
Global Big Tech Service Providers entering Blockchain
Blockchain as a service
Blockchain-IoT Service Providers
Startup Activity
Blockchain Use Cases Across industries
Select Application Segments
Blockchain and IoT in Transportation and Logistics
IoT & Blockchain Functions in Transport & Logistics
IoT and Blockchain Solutions—Transportation & Logistics
Example in Transportation & Logistics—Fr8 Network
Blockchain and IoT in Agriculture
IoT and Blockchain Functions in Agriculture
IoT and Blockchain Solutions—Agriculture
Example—IBM FooD Trust
Blockchain and IoT in Healthcare
Healthcare IoT and Blockchain Functions
IoT and Blockchain Solutions—Healthcare
Example—Chronicled and Mediledger
Blockchain and IoT in Automotive Sector
Automotive IoT and Blockchain Potential Functions
IoT and Blockchain Solutions—Automotive
Automotive Sustainability and Ethics in Smart Contracts
Growth Opportunity 1—A 5G-based Ecosystem where Telcos, IoT App Providers, and Blockchain Providers Work Together
Growth Opportunity 1—A 5G-based Ecosystem where Telcos, IoT App Providers, and Blockchain Providers Work Together (continued)
Growth Opportunity 2—Affordable Hardware/Connectivity Enable Mass IoT Deployments, Scalability Concerns Persist
Growth Opportunity 2—Affordable Hardware/Connectivity Enable Mass IoT Deployments, Scalability Concerns Persist (continued)
Growth Opportunity 3—Embedding Blockchain-based Security Throughout IoT Technology Stack
Growth Opportunity 3—Embedding Blockchain-based Security Throughout IoT Technology Stack (continued)
Growth Opportunity 4—Building Consensus Across Industries and Sectors will Create New Opportunities
Growth Opportunity 4—Building Consensus Across Industries and Sectors will Create New Opportunities (continued)
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