Blockchain is one of the most exciting new technologies of our time. It ceates public ledgers are transparent, self-policed and incorruptible. On top of them, we are already seeing fascinating technologies being built, from smart contracts, to supply chain management, to of course a whole new kind of currency. Bitcoin is a phenomenon, exciting the imagination of what is possible with this technology, and what a currency could be. However, while much has been written of its investment highs and lows, the majority of coins don’t have a truly defined purpose to be used in day to day life.
Aside from their investment potential, cryptocurrencies, underpinned by the blockchain can offer new technological possibilities such as providing a foundation for the future of IoT.
Decentralising data so everyone can benefit
The decentralisation of data and transactions brings an enormous opportunity for individuals to take control of this undervalued resource and use it for their own benefit. This is not just about removing the middle man from transactions.
Companies collect information like weather patterns, energy consumption or air quality — all public information — that is then used and sold to other companies. New technologies are changing that, by allowing any data, whether generated by man or machine, to be encoded into the blockchain itself. Backed by cryptocurrency transactions, collected data can be stored and stamped in the blockchain, assigning ownership to individuals. Through this technology, each individual can claim ownership of the original source data. Companies or research institutions searching for this data will then be able to find it and pay owners for access. Some may even pay for live access by setting up smart contracts to subscribe to your data stream or product. This empowerment will open up this previously closed market to anybody who wants to participate in it. As a result, each person on the planet can collect, use, and resell data.
Making data transactions possible and profitable with LPWAN
Monetising decentralised data flows sounds like a nice idea but until recently, it hasn’t been cost effective. That’s because wireless technologies such as LTE are owned by commercial interests, which increases the cost of using them. At the same time, technologies such as Bluetooth have limited range and other costs associated with using them. However, there is a technology out there that can overcome these issues.
LPWAN (low power, wide area network) is a relatively new wireless technology, which solves some of the problems typically faced by other wireless technologies such as LTE or Bluetooth. LPWAN is a public domain technology, making it possible for anyone to use it, and profit from it. More importantly, an LPWAN sensor can last up to ten years on a single battery. It offers a massive improvement over current wireless standards.
What this means on a practical level is that a massive array of IoT devices, built into the fabric of a smart city, require much less maintenance, would be able to connect over extremely long distances, and would be publicly available to everyone. This is why it is the ideal technology upon which to base the IoT of the future.
Cryptocurrency and Machine 2 Machine transactions
Finally, if there are streams of data everywhere. If our world becomes an environment where anyone can set up a wireless node, and transmit data that is verifiably theirs, then the question is how do you manage these data streams?
If Joe collects data, how can Alan know that it’s accurate and not random numbers? How does Bill trust Judy’s LPWAN network? How does my European Union Euro device receive payments from a University in Australia? Which currency will it accept? Also — how do I pay .0000001 of a cent for a tiny bit of information or a constant data stream? These are the problems that an advanced protocol which can encode data to the blockchain, combined with a cryptocurrency, can solve. New protocols are able to facilitate the exchange of data and payments between machines.
Imagine a skyscraper with two LPWAN (Device Data Network) Gateways. One gateway is in an apartment on the first floor, and the other is mounted on top of the building. The owner of the gateway on top of the building will likely have better connectivity than the person on the first floor, due to their superior elevation. Because of this, the gateway on top of the building is able to charge more for network access than the gateway on the first floor. This entire process can be paid for in cryptocurrency.
Why cryptocurrency? If we are to have millions of devices selling streams of data to each other constantly, we need a currency which is flexible, fast, easily divisible and universal. In a world where machines can communicate with each other and transact automatically, traditional currency simply cannot compete.
All of these technologies will ultimately combine to form the basis of blockchain and IoT based economies in the future. It is a thrilling prospect, cryptocurrencies offering a purpose with the premise of a truly decentralised community of companies, powered by individuals. Everyone will be empowered to use the same technology however they choose. LPWAN and cryptocurrency will ultimately allow IoT to be fully realised. Away from the investor hype and the multitude of failed coins, there are several out there which have been designed with a specific end goal in mind. These are the coins which we will see be the breakthrough coins of tomorrow.
By Aaron Wagener, COO, MXC Foundation