IBM VP and North American leader for Mobile and IoT said that the technology that keeps track of global transactions of the digital cryptocurrency phenomenon that is Bitcoin could be key to securing the IoT. Speaking to bitcoin news source CoinDesk, Paul Brody again cited security as a necessity for IoT deployments, and looked to Bitcoin’s block chain as a potential safeguard – and revealed that IBM and Samsung are collaborating on a proof-of-concept model.
IBM’s project, dubbed Adept and developed at IBM’s Institute for Business Vale, will be released as an open source software package on GitHub. Announced in September, Brody has once again brought the project to our attention – so here is a fairly in-depth look at the bitcoin-derived technology and its promise to drastically slash the cloud-requirements of the IoT.
Bitcoin, headlines aside, is an attempt to decentralize currency from governmental controls. Without getting too deep into the politics of the project, it is an open source program released in 2009, which records every bitcoin transaction made in the world in a public ledger – giving the currency perfect transparency in terms of the sizes and frequencies of transactions while keeping the identity of those behind the transactions secret.
The ability to anonymously pay for things with bitcoin is the main appeal of the currency, but this functionality has led to its usage on the darker side of the internet, most infamously as the method of payment for The Silk Road marketplace, where drugs, weapons and (allegedly) hit-men were bought and sold, and in the online bank robbery that was the Mt. Gox scandal. This anonymity would provide an answer to one of the most pervasive questions found in criticisms of the IoT – that it is a potential Orwellian nightmare of constant surveillance.
Bitcoins are generated by dedicating processing power to solving a series of mathematical problems. These problems are devised to become harder over time, so that “miners” who used laptops to solve them in 2009 would require dedicated ASIC boards today to generate bitcoins from the hash-solving number-crunching. The bitcoins that are generated are released in blocks of 25, and will eventually reach a maximum count of 21 million circa 2140. Mining ensures that bitcoin is distributed in a decentralized manner, and the complexity means that it is also impossible to cheat the mining system.
Those that mine the bitcoins get to keep them, but users can band together and pool their resources – sharing the coins out among themselves if they successfully release a block. Currently, mining is largely used to process the millions of bitcoin transactions that occur on the network. While transaction fees are optional, a buyer who opts to add a transaction fee to their order will receive priority in the block chain queue – which we’ll now explain.
After the users have a bitcoin, it is kept in their wallet – a digital file that is heavily encrypted and bound to an identity that stores your bitcoin credentials. If you lose the wallet, you will lose your bitcoins. Similarly, if someone steals your wallet, you can’t get it back – and if you send a payment to the wrong person, there is no way to charge-back the amount. This method prevents double-spending and conflicting transactions, but also means that the system lacks the comfortably safety-nets that exist in our current financial banking and transaction models.
This is where the block chain comes in. To keep track of the transactions, the block chain is used to record all the bitcoin transactions that happen in the world – something that is absolutely essential in a decentralized currency. Multiple copies of the block chain live on distributed servers to form the network that bitcoin users must join to trade. Once a transaction is set up, the servers validate the transaction, keep a copy of it in the ledger, and then inform all other servers that a transaction has been made. The system relentlessly tracks the coins, but not the users.
This permanent record is updated around 6 times per hour, and adds the ‘block’ of accepted transactions to the ‘chain’ of all previous trades. While proponents hope bitcoin will eventually replace other currencies, the value of bitcoin has fluctuated wildly in the past year – crashing from a high of $1,242 to its current value of $378 per bitcoin. Many saw bitcoin as a lucrative investment opportunity for turning processing power into cash, and bought powerful machinery to try and mine the blocks in the hopes of cashing out with thousands of US dollars in hand. Detractors liken it to a Ponzi scheme. Thankfully, almost all agree that the block chain is a very secure means of guaranteeing security in a decentralized system.
This is where IBM identified the block chain’s potential in the IoT. He said that using a system like a block chain would remove the need for a system to trust all of its network nodes, and instead be able to trust a majority of them. Brody predicted that this ability to create large and low-cost networks would put it in high demand as a network security backbone. “I think that demand for the block chain technology, the programmable ledger, autonomous distributed systems is going to be colossal,” he said.
This stems from the fact that a business, like IBM, could use the block chain method to massively reduce or even eliminate the costs of running and coordinating a centralized network structure – something that is absolutely key in an ecosystem that will number billions of devices, such as IoT.
Brody went on, “as devices become smarter and smarter, why shouldn’t they be able to manage themselves? The block chain allows you to run a totally distributed platform. And by our calculation, if you use the block chain, you can cut the cost of managing a high volume device network by 99%.”
A physical example that Brody gave in the CoinDesk interview involved unlocking a door in a smart home. “My smartwatch has to have a transaction with my door to unlock it. That transaction has to be broadcast in the block chain so that all the devices in my block chain, that I own, recognize me and allow my watch to unlock doors.”
As Brody quite rightly pointed out, this system won’t work using the same refresh rate that bitcoin uses – 6 times per hour. Instead, you would need an instantaneous system to unlock a door in real time, and that doesn’t sound like something that will scale well while maintaining IBM’s plans for massively reduced costs. One way to mitigate this would be localizing block chain networks, so that the home hub at the center of a mesh network is the only device checking the global block chain – or even distributing the model across countries or brands so that there would be an IBM IoT block chain, a Samsung one, a Google one, etc.
But Brody is confident that it might be feasible to use a single global block chain or network of blocks. “Transaction processing is the foundational workload of all modern computing. Tweets, likes, airline reservations, utility bills – they’re all transactions. On the block foundation level, we can do more than just infrastructure; we can write applications.”
He went on to tell CoinDesk that he envisioned an ecosystem of centralized or decentralized systems based on security requirements, but that such systems would ultimately push automated system intelligence to new heights.
The impact this could have on the IoT hardware remains to be seen. A constant need to update a block chain, which requires data communication and therefore power expenditure and the associated processing capability on the chip, seems directly at odds with the low-power and low-complexity path that the IoT mandates – but building the massive amounts of cloud-instances to manage billions of devices also clashes jarringly with the vision of ultra-cheap connectivity enabling pervasive device connectivity.
While Moore’s law will do much to enable ever-increasingly complex devices on smaller, more efficient and cheaper chips, it remains to be seen if the block chain approach is at all compatible with the hardware found in connected light bulbs or smart clothing.