IOTA Can Help Internet of Things (IoT) Go to the Next Level
The internet of things (IoT) has grown into a large industry over the last few years. As IoT devices proliferate, businesses are facing a problem with scalability. They need better infrastructure to support the numerous applications. Initially, blockchain seemed like a good solution. But certain blockchain limitations are creating hurdles for IoT products and services.
IOTA, an open-source distributed ledger protocol designed for IoT, has taken this opportunity to create a technology called Tangle. This protocol can better handle IoT-related issues in a decentralized environment. IOTA Tangle will help IoT reach more people and industries by providing cost-effective, scalable, and more secure infrastructure for micro-transactions.
Why General Blockchains Are Not Good Enough for IoT
IoT is growing at a rapid speed. It’s being used in smart homes, manufacturing, transportation, facility management, and logistics. Manufacturing plants are using IoT to automate factory floors. Autonomous cars are using IoT devices to track and monitor environments. Logistics fleets are using IoT to keep track of products from the factory floor to the customer’s doorstep. Smart homes are using IoT devices to automate lighting, garage doors, sprinklers and more. According to Statista, IoT devices will have a 3.9 to 11.1 trillion US dollars in economic impact worldwide by 2025.
IoT devices are not complicated. They can be a simple camera or a sensor. The main properties of these devices are that they can connect to other devices and make decisions autonomously. Instead of people, the devices become the end-users. That’s why it’s called “the internet of things”. As these connected devices increase in number, the infrastructure has to provide the backbone for communication, interoperability, resource-sharing, and transactions. By 2025, the expectation is that there will be 75.44 billion IoT devices on the planet.
If the enormous number of IoT devices use centralized servers, it’s impossible to deal with the traffic and processing requirements. Blockchain can handle decentralized transactions. So it seemed like a possible solution to the problem. The IoT community was hoping to use blockchain as the infrastructure for IoT transactions.
However, blockchain’s weaknesses are major hurdles for IoT implementation. Blockchain transactions are expensive and slow. The blockchain consensus process takes time. And the fees are high. It might make sense for larger transactions. But for the micro-transactions of IoT, the overheads aren’t practical.
Building a Solution in IOTA Tangle
The unique thing about IOTA is that it was created with the problems of IoT in mind. The IOTA group is aware of the challenges the internet of things faces. So they started to develop a protocol that would address those issues in particular. The result was Tangle.
Blockchains collect transaction information into blocks and then uses cryptographic mathematics to put these blocks together in an immutable digital ledger. Participants who help in blockchain creation are called miners. Miners are rewarded with fees from the blockchain.
Instead of blocks, Tangle uses Directed Acyclic Graphs (DAG) to create the digital ledger. It eliminates the need for miners and makes the fees almost zero. In DAG, transactions are validated using the past two transactions making it a faster and less expensive process. This revolutionary innovation makes Tangle affordable for IoT applications. Its cryptocurrency MIOTA is ideal for scalable and fast micro-transactions. Also, Tangle can process the transactions in parallel which further speeds up the settlement times for any micro-transaction.
Why IOTA Tangle is Perfect for the Internet of Things
The main benefits of IOTA Tangle are as follows:
Zero Transaction Fee
There are no miner fees. The zero transaction fee makes IOTA a great platform for IoT transactions. The value of an IOTA is low. Also, it uses standard conversions to make the cryptocurrency easily interpretable. For example, MIOTA is 1,000,000 IOTA. The low price of transaction and ease-of-use of the cryptocurrency make IOTA an ideal platform for IoT.
Tangle doesn’t have fixed limits on how many transactions can be confirmed per second. The result is high throughput. There’s no need to waste time reaching consensus for transaction validation. So things move forward faster making it possible for IoT devices to communicate with each other efficiently.
Works in Clusters
For transaction validation, any node in the blockchain network needs a copy of the whole blockchain. As the number of transactions grows, this causes problems for transaction validation. Tangle architecture doesn’t need to process the whole ledger. It allows transaction validations to take place in clusters. For small IoT devices, this makes a big difference. It can participate in smaller clusters and get results faster.
Custom-Made for IoT Devices
IoT devices have limited processing and memory resources. Tangle was designed with these devices in mind. So the application clients that connect the devices to the IOTA network is well-suited for smaller devices. Smaller footprints also mean the connected devices can run transactions without adversely affecting their other functionalities.
Better Security for the Future
Blockchains cryptography can be hacked in the future with more powerful Quantum computers. Tangle uses quantum-proof cryptography for its Directed Acyclic Graph (DAG). So Tangle is a better protocol to prevent future attacks.
The Future of IOTA and Internet of Things
MIOTA is already being traded in multiple cryptocurrency exchanges. Also, various industries are showing support for the IOTA technology which is increasing the value of MIOTA. Here are a few recent noteworthy IOTA accomplishments:
• DXC Technology, a world’s leading end-to-end IT company, has partnered with IOTA to provide more secure Industry 4.0 machine-to-machine (M2M) communication solutions.
• Fujitsu, the Japanese multinational information technology company, has announced a proof-of-concept IOTA project for audit trail process in the manufacturing industry.
• Bosch, the German multinational engineering and electronics company, is using IOTA Tangle to develop its own self-driving car technology. It is going to be used for Volkswagen (VW) cars.
• IOTA is also working with German automaker Porsche.
From all the support IOTA is getting from various industries, it’s evident the IOTA Tangle platform has a great future for connected devices. IOTA Tangle can help internet of things resolve the scalability issues and create robust systems for more efficient micro-transactions.