MIT Technology Review – Combining IoT and Blockchain Toward New Levels of Trust

Panelists: Michael Casey, Partner, Agentic Group and Senior Advisor for MIT Digital Currency Initiative, Ramesh Gopinath, Vice President of Industry Solutions for Blockchain, IBM, Christian Catalini, Theodore T. Miller Career Development Professor at MIT, and Assistant Professor of Technological Innovation, Entrepreneurship, and Strategic Management, MIT Sloan School of Management, Mobeen Khan, IoT Strategy & Product Management Executive, AT&T

  • Blockchain is an enabling technology/platform … not an end in itself
  • Decentralized, distributed, immutable way to manage information across parties who don’t necessarily trust each other but need to have a common outcome
  • This panel talks about how blockchain may help IoT (Internet of Things)
  • Very much early in looking how this can help the ‘Internet of Value’ (the new internet)
  • Not just an examination of quality of cryto … but also reaches to how to govern and the social components of how this platform works
  • Critical to understand how ‘trust’ works in this platform (and how it could integrate into things like supply chains)
    • If things don’t ‘trust’ other things, then this platform (blockchain) enables the things to trust other things (think not just people, businesses but IoT devices)
  • Trust … and challenges of verification
    • Considering any transaction between parties…must have some way to ensure trust
    • Blockchain isn’t applicable to every problem in transactions
    • Blockchain can help ensuring attributes of given parties can be trusted (who it is, do they have the resource to exchange)…effectively the ‘truth machine’
    • ‘Cost of networking’. Can bootstrap a digital ecosystem in a much less costly way
    • Today, things like FB, google, amazon, are centralized and thus have control over your data. Thus, affects privacy, competitiveness, etc
    • Goal is to lift up trust and rely more on combination on digital and offline technology. Blockchain helps digital trust.
  • Helps to address the ‘last mile problem’. How to get data ‘in’. Censorship resistant.
  • If there is garbage in, how to avoid this bad data from propagating. If immutable, should there be a way to ‘edit’ the chain? E.g., If there are still humans entering data into entries in the blockchain, there can still be potential for errors.
  • Verification cost: who are the actors, when was it done, etc.
  • 3 things important in end to end IoT system
    • Data has its own lifecycle – created, travels across different devices, and then ends up at rust. Trust factor has to be trusted across this whole lifecycle
    • Networks themselves and devices must also have trust
    • Trust for the policy engine for sharing of the data must also exist. E.g., a given entity may not want to share data with everything – so how to share only data with those you want – how to anonymize or hide other aspects of data (think about competitors needing to hide their internal bill of materials and components and who they purchase items from)
  • Lots of new tools being integrated into supply chain (relational systems, blockchains). How to pick right one … when is trust needed.
  • Everyone in the data lifecycle, must adopt to given model (if one link in a supply chain doesn’t adopt blockchain, its value becomes compromised)
  • How to get to everyone to adopt? Issues include
    • Complexity in a system in a given transaction (shipping, trucking, trains, ports, etc when considering shipping containers)
    • Governance. Who ‘owns’ the data, the ‘smart contracts’. Who can join and leave the networks
    • Is there scalability in the (blockchain) platform.
    • How do companies write a business case to adopt this (blockchain) technology … is it a 20 year business case versus a much quicker ROI? – How to address what is in it for businesses to adopt?
  • When thinking about the most importance contracts, human elements, such contracts are not the transactional contracts but rather the relational contracts. Need flexibility
    • Blockchain good for formal/rigid contracts … but today not so good for relational contracts
  • What are the use cases? (2017 was the year of blockchain tourism)
    • Education
    • Financial
    • Supply chain
    • Healthcare
    • Food safety
    • Shipping containers
  • Potential to transform industries
  • Looking 10 years ahead
    • AI … reduce costs on address judgement
  • Blockchain is still at beginning of hype curve
    • But will help address efficiencies
    • (Blockchain) will help improve acceptance of trust

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