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  • Writer's pictureUjjwal Bajaj


An Internet of Things (IoT) device is a physical object equipped with mechanical or electrical components. These devices are considered "smart" because they have sensors and microprocessors, allowing them to sense and process their environment. Another crucial feature of IoT devices is their ability to digitally connect with other devices using standard internet technologies, enabling them to communicate and perform tasks automatically. Humans can also interact with IoT devices through equipment systems like monitors.

Blockchain Identifiability for IoT Devices

  • No Direct Connection: Some IoT devices communicate indirectly with the blockchain, e.g., via a cloud server, making identification challenging.

  • Light Nodes: Devices with limited computing and network capacity can connect to a blockchain using light clients like Ethereum's Mist Browser for basic functions.

  • Full Nodes: Devices with ample processing and storage capacity, like IoT home gateways (e.g., Raspberry Pi), can participate as full nodes, supporting blockchains.

Gateway for IoT Devices

  • Central Cloud Server: Connects to IoT devices, collects data, and stores it in the blockchain. Vulnerabilities include single point of failure and lack of data signing at the source.

  • Remote Procedure Call (RPC): Trigger procedures on remote enterprise servers via embedded gateways. Gateways sign transactions locally before communication, ensuring authenticity and integrity. Each IoT device is uniquely identifiable within the blockchain.

  • Other Gateways: Some devices act as intermediaries, enabling communication from smaller, low-end devices to the blockchain.

Blockchain-Enabled IoT in Logistics and Supply Chain Management

One significant application domain for combining blockchain with the Internet of Things is logistics and supply chain management. This is due to the interconnected nature of resources and goods, both within and across companies, which exchange information and negotiate interactions. Secure storage locations are essential to keep track of value-adding activities. Blockchain facilitates communication between IoT devices and ensures the verifiable transmission of information. When used alongside smart contracts, industrial equipment can autonomously provide paid services, report maintenance needs, issue invoices, and make debits.

Examples of exchanged data within supply chains include real-time vehicle maintenance data, wear data, fill level indicators, derivative indications, or temperature indications for goods stored in refrigerated containers. This information triggers follow-up actions, such as intervention when temperature exceeds tolerance limits or when vehicle maintenance is overdue.

Blockchain devices encompass various IoT devices, such as smartphones, tablets, temperature sensors, or hardware wallets for storing tokens, which communicate with a blockchain.

Several approaches to blockchain devices:

  • Griggs et al. (2018) designed a blockchain system based on a private Ethereum framework. In this system, sensors communicate with IoT devices that invoke smart contracts and record all events on-chain. The IoT device acts as a bridge between sensors and blockchain nodes, making patient data visible through specialized software.

  • Caro et al. (2018) developed a blockchain-based food tracking solution using Ethereum and Hyperledger Sawtooth. IoT devices are integrated to process GPS data, with direct access to data and storage as full nodes on the blockchain. For instance, devices on trucks scan batch packaging via RFID tags, monitor temperature and GPS position during transportation, ensuring transparent and verifiable traceability.

  • Laszka et al. (2017) describe a privacy-preserving energy transaction solution (PETra) for transactive microgrids. PETra utilizes distributed ledgers for anonymous communication, bidding, and trading. While the solution involves IoT infrastructure development, it doesn't specify which device communicates with the blockchain. A smart meter is mentioned as a potential device for measuring energy production and consumption securely.

  • Grecuccio et al. (2020) report a software framework that allows IoT devices to interact directly with an Ethereum-based blockchain. This solution enables the integration of various IoT devices without relying on a centralized intermediary. Each IoT device has its own gateway, can sign transactions locally and offline, and is identified by its address within the blockchain, making it a potential target for smart contract events.

These examples illustrate the diverse ways in which IoT devices and blockchain can be integrated to enhance various applications, from healthcare to supply chain management and energy transactions.


Incorporating IoT devices with blockchain presents key challenges in terms of security and identifiability. However, solutions like light nodes and full nodes enable seamless integration and data validation. Gateways, whether cloud-based or using remote procedure calls, act as bridges between IoT and blockchain, bolstering connectivity and trust.

As we enter the IoT era, blockchain will continue to evolve, playing a crucial role in shaping the future of connected devices. Its strengths in security and transparency will drive innovation, foster collaboration, and reshape industries. The fusion of IoT and blockchain isn't just a tech partnership; it's a catalyst for transformative change, ushering in a smarter, more interconnected world.

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