IBM has developed a method for using a blockchain on a network of Internet of Things devices to execute smart contracts, another sign that Big Blue sees bigger applications in the fledgling space.
First reported by Coindesk, the method was revealed in an IBM patent application released last week, showing that IBM has devised a way to allow for the secure execution of smart contracts, a protocol that sets rules and conditions for transactions on a blockchain, on connected devices.
The Armonk, N.Y.-based company hasn't been shy about its blockchain ambitions, most recently showcasing the use of blockchain applications to help track food supply chains for Walmart and nine other major brands. The company also recently revealed a blockchain called TrustChain that can ensure the authenticity of jewelry, tracking the diamond or precious metal from refinery to retail.
As explained by Coindesk, IBM's proposed method seeks to tackle two challenges of running a blockchain — the decentralized ledger technology that powers Bitcoin — on an IoT network. The first challenge is that an IoT blockchain network wouldn't be able to participate in the compute-intensive process of mining that powers major cryptocurrencies because the connected devices don't have enough power. The other challenge is that a large-scale mining operation could likely have a higher success rate of attacking and compromising an IoT network.
IBM proposes to solve these problems by limiting the numbers used in a proof-of-work system, which is the consensus algorithm that is used to confirm transactions. The goal is to "provide equal chances of successful completion of proof-of-work to all IoT devices in the network," according to the patent filing.
The company said use cases for this method include "peer to peer (P2P) energy networks, logistic networks, crowd-sourced weather networks, and the like."
Brad Johnson, director of data science at New Signature, a Washington, D.C.-based systems integrator, told CRN that IoT and blockchain "feed into each other in ways that are very important."
"IoT really creates the opportunity for different decentralized models for running things, and blockchain is really important as an enabling technology for those types of distributed systems," he said.
Johnson said IBM is one example of how companies are starting to address the variety of issues posed by deploying blockchain in IoT networks.
"What we're seeing is that industry players of all types are creating solutions to those problems one at a time, and there's going to be a great diversity to the solutions as those problems come about," he said. "But what we're really driving toward is a model by which devices can opt into these networks that are voluntary and can transact across those networks with one or another."