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Every now and then a technology emerges that has the capacity to change everything. The Internet, electricity, steam power, even the wheel and fire once upon a time. 10 years ago another of these game-changing technologies emerged but it has taken almost decade for us to truly grasp its full potential.

It’s invention in 2008 is shrouded in mystery, developed by a (maybe) unconfirmed person who has come to be known as Satoshi Nakamoto. We’re talking about blockchain technology, which has, until recently, been primarily known for its cryptocurrency applications but is now showing its power to benefit almost every part of modern society.

Blockchain is essentially a distributed ledger, where a continuously growing list of records, called blocks, are linked and secured across a broad network. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority – making it very difficult to corrupt or manipulate data once recorded.

Blockchain therefore allows secure transactions to take place transparently and in an instant, hence its use as a currency trading system. The financial sector, who were initially cautious of blockchain have now wholly embraced it, with almost every major bank exploring and developing the technology in one way or another. The blockchain is not just about money however, it supports transactions and recording of all kinds.

The Institute for the Future (IFTF) produced this two minute video to help people understand the blockchain;

In this series of articles we explore blockchain’s disruptive impact on the energy sector, as well as smart cities and smart buildings, and the wider internet of things (IoT) movement. As we have discussed broadly at Memoori, the IoT facilitates the cyber-physical revolution, where billions of connected devices create intelligent environments that are able to adapt to meet specific objectives; be that occupant comfort, energy efficiency or all manner of other things.

The IoT is already making its mark on modern society but is held back by a number of issues. Firstly, by creating a multitude of new digital endpoints we create new vulnerabilities for cyber-attack, as shown by the multitude of major hacks we have seen in recent years. Secondly, by sensing and tracking occupant behaviour the IoT has elevated privacy concerns of many people working in smart environments.

These two elements, privacy and cyber security, are considered the biggest obstacles facing the development of the IoT today but blockchain offers viable solutions to both problems. Using blockchain we can create unhackable, incorruptible, and quickly accessible trusted identities for both devices and people.

Consider the October 2016 Distributed Denial of Service (DDoS) attack that is widely considered to be the biggest cyber attack in history. The hackers used IoT enabled devices such as video surveillance cameras and printers, to overwhelm the popular DNS service Dyn – host to major websites such as Twitter, Netfilx, Spotify, and Reddit.

The readily available Mirai-based botnet that was used showed just how easy it is for malicious entities to compromise critical internet infrastructure. However, a blockchain approach to storing DNS entries and identifying devices could, in theory, improve security by removing the single, attackable target. Blockchain startup Gladius states that its decentralised solutions can protect against DDoS attacks by “allowing you to connect to protection pools near you to provide better protection and accelerate content.”

The privacy issue is different but the blockchain solution is similar. In order to best control an environment for the sake of occupants data must be collected on the preferences and behaviour of those occupants. However, smart building occupants and the wider public are increasingly concerned that the simple fact that such data exists puts their privacy at risk – from intentional misuse or from data breach. Just as blockchain can be used to better identify devices, it can also provide a secure way to store personally identifiable data while retaining anonymity.

“Tracking individuals within a building will enable the space to be more efficient and personal. That said, valid privacy concerns arise as more data is collected about more occupants. Blockchain could provide security and anonymity while also enabling building systems to collect more detailed data about individual occupants,” explained Joseph Aamidor, a 12-year veteran in the building and energy management industry.

Such is the belief in blockchain for human identities that IT giants Accenture and Microsoft have teamed up with the United Nations (UN) on a blockchain-based digital ID network. As part of the 2030 Sustainable Development Program, the UN aim to provide a blockchain-based legal identity for everyone on the planet. Once on the system, simple biometric identification would provide approval, or denial, for a wide variety of restricted areas and services and do so without disclosing any additional information about the person to those organizations requesting approval.

“Security and privacy concerns continue to act as a barrier to occupancy analytics market growth. Passive tracking of ID cards, smartphones or other unique identifiers, also provide more information than is necessary for occupant tracking, sparking privacy concerns,” we highlighted in an article last month. Blockchain, beyond any other technology conceived today, has the potential to provide trackable identities for occupancy analytics while alleviating privacy concerns, thereby aiding the acceleration of IoT development with the support of all stakeholders.

“The internet was developed without any sense of a provable personal identity,” highlights Ben Algaze, veteran software engineer of IBM, Microsoft and Dell, among others. “With blockchain’s open ledger and smart contracts, you could have a secure way of proving that you are who you are on the Internet, while controlling who gets access to your ID information and how it can be used. It can be used to prove residency, age, and identity that are backed by a trusted authority.”

Imagine for a second where the IoT might be today, if privacy and cyber security risks were never really an issue. Overcoming these two huge barriers facing development of the IoT would unleash its potential like never before, with profound implications for the sector and modern society as a whole. While no system is perfect, blockchain appears to offer the best path to overcoming key obstacles holding back our evolution to the hyper-connected, intelligent future that IoT promises.

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