Blockchain Use Cases: The Internet of Things (IoT)

Blockchain Use Cases: The Internet of Things (IoT)

Publicat Apr 16, 2019Actualizat Jun 9, 2023

What is the Internet of Things?

Since the early days of the Digital Revolution in the 1950s, a wide range of groundbreaking technology has been created. Despite being initially restricted to just a few individuals, the industry developed very quickly, and most of the novel technologies became increasingly widespread and accessible.

The convergence of the various types of innovative devices (such as RFID chips, sensors, and the Internet) and their increased accessibility eventually gave birth to the concept of the Internet of Things (IoT). IoT technology marks a significant shift in the Computer Age that now allows for more than just computers to be connected through the Internet.

The history of IoT

The first known use of the IoT was at MIT, where university students used cheap sensors to monitor and restock their cola dispenser machine. More progress towards the IoT was made around 1994 when a journal article by Reza Raji proposed the idea of moving packets of data in order to automate homes and factories. 

Around the 1990s, Microsoft along with several other companies began experimenting with similar ideas, and from 2002 onward, many media outlets started discussing the breakthroughs of IoT - such as the use of smart devices connected to each other while linked to a monitoring information system. Nonetheless, 2008 is regarded by many as the official year of birth of the IoT industry, when there were more electronic devices connected to the Internet than people.

How IoT works?

IoT technology is basically the internetworking of multiple physical devices and objects and usually consists of a network of sensors and non-computing devices that communicate with computers or and devices through the Internet. This may include the use of thermostats, heart rate monitors, sprinklers, and home security systems. The innovations of IoT technology allows for the remote monitoring, control, automation, and status checking of a wide range of devices and sensors, which can be used on smart homes and self-driving cars.

IoT for personal and domestic use

IoT technology can be deployed in many different ways for personal and domestic use. Common examples are related to the concept of home automation, where several devices can be employed to monitor and control the use of lights, air conditioners, heaters, and even security systems. These devices may also be connected to other personal items such as smartwatches and smartphones, or also to dedicated smart hubs that are designed to connect different smart home products (such as smart TVs and refrigerators).

Automated homes also have the potential to significantly improve the quality of life of older adults and people with disabilities by providing assistive technology for them - especially for the ones with sight, hearing or mobility limitations. This may include the use of real-time sensors that warn family members when their relative’s heart rates are abnormal or when they experience a fall. Another interesting example is the use of smart beds to detect whether a bed is occupied or not, and these are already being tested by some hospitals to track when patients leave their beds.

IoT for commercial and industrial use

Some examples of industrial use cases may include the use of sensors to track environmental conditions, such as temperature, humidity, air pressure, and quality. IoT devices may also be used by farmers to track when their livestock is running out of water or food, or by manufacturers to be aware when an important product is about to run out. They could even set automated machines to order more of that product when the supply is below a certain threshold.


The Internet of Things brings lots of interesting innovations and is certainly here to stay. Concerning its limitations, however, one issue in the use of IoT systems for both businesses and homes is the increased number of devices required to be monitored and connected (and many of them may be dependent on Internet connection). If the implementation is not proper enough, companies and homeowners may have to access several different Apps in order to monitor their multiple devices. This would make IoT more time-consuming and less attractive to potential customers. 

For this reason, some companies like Apple and Lenovo, have created applications that allow devices to be controlled in the iOS environment, even through the use of voice commands. Other IoT platforms work around hubs that are independent of the Internet or WiFi access. Examples of these are Amazon's Echo and Samsung's SmartThings Hub. So, the IoT works by the devices being linked to a sensor, which is often connected either to the internet itself or to another WiFi receiver, allowing for central control, programming, and monitoring.

IoT cryptocurrencies

Many IoT systems will likely be dependent on financial micro-transactions between digital objects, and this will require the IoT devices to be connected in a way that allows for the so-called machine-to-machine (M2M) economy - which is basically the exchange of money between non-human devices. In such a context, there is an increasing demand for IoT-compatible currencies, and cryptocurrencies are certainly a viable alternative.

At first, many believed that the blockchain itself would be the basic framework for the M2M economy since it is suitable for micropayments and is widely used with cryptocurrencies. However, many blockchain networks have limited performance in the number of transactions per second they can handle. This means that most Proof of Work and Proof of Stake blockchain implementations currently present a limited potential for scalability, making them unsuitable for processing M2M microtransactions on a large scale. Nonetheless, it is worth mentioning that many blockchain projects are working towards scalability solutions, such as the Bitcoin Lightning Network and the Ethereum Plasma.

Closing thoughts

The Internet of Things (IoT) will eventually allow for automation, supervision, and control of devices on a mass scale, which will certainly improve our daily lives and increase the efficiency of various industries. There is a good chance that cryptocurrencies will be a part of the IoT revolution, serving as the digital money for the microtransactions and M2M economy. Currently, there is a limited number of cryptocurrency projects targeting the IoT industry, but we will likely see many more being created in the near future, as technology continues to advance at a fast pace.