In the past few years, developments in technology have brought us closer to the hyper-connected world that futurologists imagined in the 1950s. Self-driving cars, computers that can converse in real-time and hyperloop transportation are among the developments that will shape our future beyond what we thought possible.
Of all the major trends, the Internet-of-Things (IoT) is making the most visible and immediate impact and will be worth $270 bln by 2020. Connected devices, homes and vehicles are just around the corner, and as anyone with experience in the technology industry knows, this means a lot of second-order complexity will have to be solved. Economies, platforms and payment systems will have to be integrated.
This represents a huge challenge and opportunity for entrepreneurs and investors. Of course, the other major development in technology is the rise of Blockchain. Many of the emerging hurdles from the IoT-networked future will leverage the capabilities of Blockchain, which enables greater transparency and trust (especially regarding payments).
Some of the biggest names in manufacturing are looking to be pioneers in leveraging Blockchain for IoT. Among them is Hdac Technology AG, which has a solid reputation on the IoT end of the equation but are hoping to bring Blockchain to maturity for IoT.
Hdac is in the process of organizing the release of the Hdac token which aims to address the future of IoT.
Challenges in a connected economy
When you consider the complexity involved in a house, car or workplace that is fully connected with a range sensors from a range of different companies, it becomes clear how difficult it will be for both customers and businesses to manage security and payment issues.
Consider the security challenges involved in safely making an online payment on your phone in a public place. The vulnerability to security breaches is so high that many security checks, secure connections and other measures are necessary. Imagine then a factory floor or connected home that has dozens of these connections transferring data among each other constantly 24 hours a day.
Firstly this presents obvious issues in terms of security. If one node on this network becomes compromised, this puts the whole fabric at risk. Secondly, the different security protocols and requirements of each device make integration slow and difficult at times. Finally, the fact that so many points of failure exist makes monitoring a wide network of IoT devices at best difficult, at worst impossible.
What is possibly most worrying from a consumer perspective is not just the risk of devices being infected with viruses, but also the need for privacy if having dozens of sensors in your home tracking all aspects of your life. Even if it is not used to directly defraud you, connecting your home to the Internet puts your privacy at risk.
When you consider where the IoT market is going, these issues could be big hurdles for homes, vehicles and enterprises that are interwoven with sensor technology - and it is clear that for complete market adoption a more seamlessly secure system is needed.
Leveraging the security properties of Blockchains
If you have even a passing familiarity with Blockchains you will know that security issues are what crypto is designed to address. Not only do Blockchains provide an immutable information, they can also enable complex rule-based transactions (like smart contracts) that make automated security and transparency possible in a way that was previously impossible.
The team behind Hdac have designed it to address multiple aspects of the conundrum. First and foremost Hdac provides a layer of security to IoT usage, as explained by the team:
"By merging Blockchain with IoT it is easier to implement confidentiality and integrity - vital factors to ensure reliable connections and secure the processing between the devices. This allows the connected devices to respond to fabrication and modification attacks and enhances the trust between the parties in communication."
Their platform leverages the mathematical properties of Blockchain to enable checks and controls on transfers of data between devices and also the Internet.
A "ledgerized" IoT setup as designed by Hdac works on two levels; firstly it puts controls on data transfer within the user's network of devices, but it also records and controls interactions with this internal ledger and the Internet. This reduces the number of points of security failure and also increases the oversight a user has over the data transfer that goes on.
Hdac has developed its own Blockchain which the team believes offers more capability than using the Ethereum or Bitcoin protocols. Of course, the IoT ecosystem is intrinsically linked with micropayments, so Hdac is equipped to handle these use cases.
The Hdac platform is part of a group of Blockchain projects with the involvement of the Hyundai Corporation through Hyundai Pay, which also includes a system to make remittances easier for third world countries. The experience this company has with technology should encourage investors, especially since Hdac is applied directly to hardware technology applications which is Hyundai's core business.
The Hdac team are ramping up the release for Nov. 27 when the token generation event took place. The wider Hdac ecosystem has a wide-reaching roadmap extending beyond 2020.
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