The Economy of Things: What it takes to fuel the new data economy

Technology needs to be in service of human creativity and societal good. However, the ownership of value over personal data and identity needs to be reset. This is the view of Raquel Katigbak (Global Client Partner at IBM) who was speaking at the recent Technology of Tomorrow Conference hosted in Warsaw, Poland.

‘The Internet effectively digitised assets of information including music, news, weather, traffic and maps. The liquefaction of all these assets has generated the web2 economy and strengthened how big platforms and hyper scalers have succeeded in this world,’ Katigbak said.

‘When we think of the Internet of Things (IoT), it is effectively going to be doing the same thing for the physical world. Liquidity is really about getting around to that fundamental value proposition within a single asset and how that asset can be monetised.’ Katigbak pointed to industries such as agriculture, supply chain, automotive, healthcare and civil services which are all set to benefit in this regard.

The Economy of Things

Katigbak noted that the number of IoT devices officially surpassed the number of humans on the planet in 2019 (8.6 billion) and that the industry is set to see rapid growth over the next ten years. This includes an estimated 29 billion IoT devices by 2030, which will have a potential economic value of $6 trillion within the same period. A whopping 55 ZB (zettabytes) of data is expected to be generated within the next seven years.

‘The way to unlock all of this value is by looking at it as the Economy of Things,’ said Katigbak. ‘This is a searchable, indexable and tradeable Internet of Things.’ She added that this new economy is grounded in asset marketplaces and new business models and that each participant (e.g. the automotive industry, supply-chain industry etc..) will bring their connections and subsequently strengthen the entire ecosystem.

While this rapid growth is already being seen today, Katigbak noted that this is not enough to simply stick IoT sensors to its objects and hope that everything connects and creates value. Instead, she noted that a successful Economy of Things will need to be built on three key principles:

Simple governance, access and reuse rules;
Trust, privacy and security;
Low barriers to data sharing.

How IoT and blockchain can work together

IoT (Internet of Things) and blockchain can work together in several ways to enhance security, transparency, and efficiency in various applications. Here are some key ways in which IoT and blockchain can be integrated:

Data integrity and security: Blockchain’s decentralised ledger can be used to store IoT-generated data securely. Each data point is time-stamped, hashed, and added to the blockchain, making it immutable and tamper-resistant. This ensures the authenticity and integrity of IoT data, which is crucial in applications like smart homes, healthcare, and supply chain management.

Identity and access management: Blockchain can establish and manage unique identities for IoT devices. Devices are registered on the blockchain, and access permissions are controlled through smart contracts. This enhances device security and ensures that only authorised devices can interact with the network.

Supply chain management: In supply chain management, IoT sensors can collect data at various points, and this data can be securely recorded on the blockchain. This creates a transparent and auditable record of the product’s journey from manufacturing to delivery. Smart contracts can automate processes like payment and quality control, reducing errors and fraud.

Smart contracts: Smart contracts, executable code on the blockchain, can automate actions based on predefined conditions. IoT devices can trigger these smart contracts, enabling automation in various applications. For example, in agriculture, IoT sensors can monitor soil moisture levels and automatically trigger irrigation systems when needed.

Decentralised Autonomous Organisations (DAOs): IoT data can be used in decentralised applications (DApps) that run on blockchain platforms. These DApps can create decentralised autonomous organisations (DAOs) that make decisions based on real-time IoT data. For instance, an autonomous vehicle fleet could collectively make route decisions based on traffic data from IoT sensors.

You can find some specific use cases for IoT on the BSV blockchain here.