Glossary
Internet of Things
The Internet of Things, IoT for short, is a relatively recent concept that involves the connection of everyday utensils to the Internet, such as security cameras, light bulbs, robot vacuum cleaners, and refrigerators, among many others. Until some years ago, only computers and cell phones were able to connect to the Internet, but Internet connection is becoming more and more ubiquitous among devices.
We can imagine the example of a refrigerator capable of measuring the amount of milk present and automatically ordering more milk from a supermarket if that is necessary.
Integrating the IoT with the blockchain through smart contracts should be a natural step forward. We can imagine devices with blockchain accounts interacting with smart contracts. In the case of the refrigerator, for instance, it could use its tokens to order products.
Let’s imagine a supply chain or tracking scenario. Including a chip in a product with a sensor to measure some required property, such as ambient temperature, is possible. This sensor has a private key and automatically logs data to the blockchain. This ensures non-repudiation and immutability of the information provided by the sensor.
Another scenario that we can imagine is receiving products ordered from a seller. An IoT chip also linked to a blockchain can inform a smart contract of the arrival of the product at its destination, releasing the payment to be withdrawn by the seller. The contract will automatically refund the buyer if the product does not arrive at the destination within the specified time.
Blockchain integration with the Internet of Things can also help solve the oracle problem. Oracles are entities that insert data from the outside world into the blockchain, and a problem is that this can bring a new degree of centrality to the network. Through the integration with the IoT, certain information can be inserted into the network through sensors or measurements carried out by entities that do not depend on human interference.
Both the Internet of Things and the blockchain technology have been growing in use in recent years, and greater integration between these technologies is expected in the years to come.
