Gartner finds 75% of the organizations that have implemented the IoT plan to link it with blockchain technology.
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Technical analysis company Gartner has news for companies that intend to integrate their Internet of Things (IoT) systems with blockchain: you are not the only one.
Seventy-five percent of the organizations have already merged the two or are planning to do so in the following year. That number jumps to 89% within two years, indicating that companies with heavy investments in IoT technology almost all see the value of blockchain technology to improve IoT security and reliability.
SEE: How blockchain will disrupt the company: a special report (free pdf) (TechRepublic)
To make the plea for IoT and blockchain side by side even more airtight, 94% of companies with mature IoT implementations (defined as Gartner as KPIs and expertise centers in their IoT systems) plan to connect their IoTs with blockchain.
“The integration of IoT and blockchain networks is a good place for digital transformation and innovation,” said Avivah Litan, distinguished vice president at Gartner. “According to the research, things are actually moving much faster than expected.”
Why organizations connect IoT and blockchain
The connection of IoT and blockchain has been in the news for quite some time, with everyone, from analysts to large companies such as Samsung, saying that the integration of the two is the way forward for both.
The findings of Gartner in this report reinforce the fact that said integration occurs – and quickly – but the study also focuses on why IoT and blockchain come together, and the reasons are not surprising.
The main reason why respondents surveyed the integration of blockchain and IoT is “increased security and trust in shared transactions and multi-party data”.
Connecting IoT sensors and devices to a blockchain “allows an invariable audit trail of important IoT data and related business events that is shared by multiple participants and that can be independently verified by each party,” the report said.
Second, and closely related to security, is the ability of blockchain-connected IoT devices and sensors to save organizations money. Blockchains enable the use of decentralized applications that work across platforms, support smart contracts and provide more automation that can reduce labor needs and accelerate processes from factory to retail.
Other reasons mentioned for the integration of IoT and blockchain are increased sales and new business opportunities and improved participant experience. However, both were far behind security and cost effectiveness.
SEE: Special report: The rise of Industrial IoT (free PDF) (TechRepublic)
How companies can get the most out of IoT and blockchain integration
Gartner offers three recommendations for companies that want to integrate IoT and blockchain:
- IoT / blockchain integration is currently best suited “to increase trust and security in multi-party shared transactions and to automate processes among network participants.”
- IoT and blockchain integration is still an emerging technology. If you are considering it for your organization, make sure that the immaturity and rapid rate of change in both areas will not cause any problems.
- Long-lived IoT devices and long-lived data are currently not the best use for IoT / blockchain combos due to problems with deploying large-scale updates. If that is the type of needs, your organization has instead considered invariable centralized databases such as Datomic or Amazon QLDB.
Blockchain word as a symbol cryptocurrency in chrome chain.
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