While there are still few large-scale use cases of blockchain, the Internet of Things (IoT) industry turns out to be “a sweet spot” for the adoption of such technologies.
Avivah Litan, an IT industry analyst at Gartner, said in a survey, said that“75 [percent] of IoT technology adopters in the U.S. have already adopted blockchain or are planning to adopt it by the end of 2020 out of more than 500 U.S. companies.”
Blockchain technologies can create a trusted environment for data transmissions between virtual networks or devices while increasing efficiency of such exchanges, according to the survey.
According to Litan, of the 75 percent of blockchain adopters, 86 percent are implementing both IoT and blockchain in various projects.
The IoT companies aim to integrate computing devices with digital and mechanical machines to avoid human-to-human or human-to-computer interaction.
For example, Apple Watch and Amazon Alexa are using these technologies in consumer goods. The technologies can also be used in the healthcare, industrial and military sectors.
Increased security and trust in shared multiparty transactions are the top benefits when the companies combine blockchain and IoT technologies, according to 63 percent of the survey respondents, while 56 percent said the top benefit is an increase in business efficiency and lower costs.
However, Litan cautioned that blockchain implementations related to protocol changes could be difficult for long-lived IoT devices due to its relatively high volatility.
“Some blockchain implementations struggle to scale to the transaction rates that can be generated by large numbers of connected things,” Litan said, expecting the necessary evolution in both blockchain and IoT to mature in five to 10 years.