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Strength in numbers. Interoperability in the Blockchain of Things (BoT) era.

Nowadays, the Internet of Things plays a very important role in our lives. The IoT makes it possible to collect and analyze data, as well as to enable machine-machine and human-machine connection. However, in the IoT sector there is a major problem to be solved if we want to expand the number of connected devices, and that is interoperability. Interoperability is an essential quality to make the IoT industry work optimally, where everything is connected to everything.

IoT interoperability is key

First, let us define interoperability. As defined by the IEEE, it is the ability of two or more systems or components to exchange information and use the information that has been exchanged. In other words, interoperability is the ability of two different systems to communicate and share services with each other, regardless of their manufacturer and technical characteristics, in order to take advantage of the full potential of the IoT ecosystem. An example is in people, people speak different languages, but they can still communicate with each other through a translator (human/tools) or using a common language.

It has been estimated that up to 60% of the value that could be unlocked by IoT systems is currently blocked by a lack of interoperability, and this means that a lot of value is lost along the way. In other words, we have reached a state of parallel innovation, where an improvement of current innovations is required to move to the next scale of adoption. McKinsey estimates that the global market impact of IoT could be between $3.9 trillion to $11.1 trillion by 2025. However, of the $11.1 trillion, McKinsey says 60% will be achieved if a real solution to interoperability between IoT devices, companies and industries is achieved.

Interoperability could be divided into 3 levels. The level where IoT devices have the ability to collect information and send it to the cloud, through a series of protocols, such as 6LoWPAN or CoAp. Secondly, the platforms from which the data is extracted for analysis, and finally, the service layer where the information generated by a service that uses a particular IoT device can be reused. The lack of interoperability is detrimental both to service providers that are tied to a particular IoT device or software offered by a single provider, and to application developers who have to adapt their application to the platform-specific API due to the incompatibility that may exist between certain platforms.

Blockchain interoperability

Currently the IoT market is not completely monopolized, but it is true that there are certain platforms that have a large market share. The problem is that they are not economically motivated enough to share the massive amount of data they receive, nor is there a totally secure mechanism in case they want to share all the data. It is at this bottleneck, where Blockchain technology comes in and provides a viable solution.

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Blockchain is able to bring security, privacy and interoperability through its distributed system to the IoT sector. The use of Smart Contracts, decentralized oracles, web3 and interoperability between chains and sub-chains could replace traditional platforms to achieve maximum IoT adoption. One of the main problems as new blockchains independent of Bitcoin have been created is the difficulty of interoperability between layer 1 blockchains. That is why tools have been born in the Blockchain ecosystem that increase the level of interoperability between them and every day they are improving even more. Some of these solutions are mentioned below:

  • Layer 2 solutions

    A layer 2 (L2) solution is a protocol or network built on top of an existing blockchain platform or layer 1 (L1), with the goal of increasing the performance of the original blockchain, reducing transaction costs, improving scalability and efficiency. A clear example would be Bitcoin (layer 1) and Lightning Network (layer 2), which is a solution to increase transaction speed on the Bitcoin blockchain. There are several types of layer 2 solutions, but one of the most relevant is state channels which aim to improve transaction speed by using a multi-signature transaction to create a state channel and perform several off-chain transactions. On the other hand rollups to execute transactions outside the main chain (Zk Rollups and Optimistic Rollups) and finally sidechains, which are independent chains, with their own protocols and their own security, but which are compatible with the main chain.

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  • Decentralized oracles

    The use of decentralized oracles, such as ADOS, is necessary to achieve the desired interoperability. Oracles play a fundamental role in bringing Blockchain technology closer to the real world, as in the case of IoT devices. In addition, they are a key point for the data to be introduced in the Smart Contracts of the blockchain and contribute to the interoperability of the blockchain guaranteeing the common truth between different systems. So oracles are a fundamental part of sharing data between devices in real time and allowing them to be interoperable without the worry of whether the data being contributed is true or not.

    Finally, there are the interchain bridges, but they are not explained in this article since their usability is more focused on the exchange of digital currencies in different blockchain protocols. You can read a more detailed article on what interchain bridges consist of here.

Web of Things (WoT)

Lately, a concept that will also be very important in the IoT sector and device interoperability has been discussed and it is the term 'WoT' or 'The Web of Things'. WoT is part of what we could call 'semantic interoperability', which is the ability of data sources and applications to exchange information without prior knowledge. To understand the concept of 'Web of Things', we can say that it is an infrastructure on top of IoT that enables devices to use common media and languages through web architecture practices and allows real-world objects to be part of the World Wide Web (WWW) through existing standards and protocols such as REST, HTTPS or JSON. An example to better understand this is if we assume a smart sensor that acquires information, processes it and sends it back. This is fine, but to communicate with the outside, it would need to interact and allow interaction with it through a communication layer, where from the outside such a device would be seen as 'The Web Thing'.

The WoT is divided into four layers. The access layer where through protocols such as HTTPs and APIs we make the IoT device accessible. The discovery layer is understood as the way in which these devices can be seen and understood by other devices or platforms. The communication layer using protocols such as TLS (Transport Layer Security) to send and receive information. Finally, there is the creation layer, where frameworks or libraries are used to create applications and visual interfaces that can be understood by other systems or humans, in order to interact with data and IoT devices.

Future of IoT

The IoT sector is constantly growing and growing faster and faster. That is why it is necessary to use new technologies such as Blockchain to provide missing pieces to the puzzle. Among them is the problem of interoperability, where, as we have seen, for the Internet of Things to work on a global scale, everything must communicate with everything and decisions and much data must be shared in a secure and legitimate way. Interoperability through Blockchain technology still has a way to go, but it is clear that it will be a near-term solution for the IoT sector.

Although interoperability between chains, subchains and blockchains is not fully advanced, better and better results are being achieved. One example is IoTex, which has a subchain architecture, or Internet Node Token, where blockchain solutions are already being implemented for the interoperability of some IoT devices. It may seem like something out of a science fiction movie, but the IoT is here for a hyperconnected future, where many of our objects will have the ability to see and feel everything around us, transmit information in real time and help us in our daily lives through data processing with artificial intelligence.

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