Part 11: The Value of Blockchain Application

 Blockchain Internet of things

The Internet of things formed by hundreds of billions of devices, the identity authentication mechanism for user security associated with the device. User creates and maintains other devices with the interaction rules dynamically. These rules provide a powerful mechanism to determine the relationship between the user and device, and the standards defined by users—— the rules for the society, the material or the temporary rules —— to allow the device whether is available.

When upgrade software security by device test or forbid the incorrect behavior participant, rules can also be defined by the 51% consensus mechanism. User should create and execute the digital list based on a predefined set of rules, and the goal is to help ensure that the running device with no failure.

The role of device

On the other hand, device has been authorized to upgrade by searching for their own software, confirm each other’s credibility and pay for resources and services, execute the contract automatically, such as protocol, payment and deal with other devices. This allows them to play a role in self sustaining and self serving.

The ability for automatically trading of intelligent devices creates a new business mode that facilitates new business opportunities: each device from the Internet of things can act as an independent business entity, share the capacity and resource with other devices by a low transaction cost, such as computing cycle and bandwidth. In addition to more fully utilizing the one billion devices then ever before, not only formed the new business mode, but also promote the birth of new market with the related service and consumer goods of devices.

The role of manufacturer

For the device manufactures and service providers, the Internet of things based on Blockchain has a great appeal. It allows they transfer the responsibility of equipment maintenance to a self-maintenance community, which makes the Internet of things will not be outdated whenever in the device life cycle or over the life cycle, and save infrastructure cost at the same time.

In this mode, user controls his privacy, not by a centralized institute, and the device is the master. The cloud’s role has changed from a controller to a service provider. In the new democracy, the power of the network moves from the center to the edge. Device and cloud have become the equal citizens.

The device driven democracy is clearly to attract the interest of participants in the Internet ecosystem of things. However, its greatest value may lie in the macro level, not only to create a scalable and efficient Internet of things, but also create a new market and a new business mode.