Best 5 Blockchain-based IoT Projects You Should Watch

Technology is evolving rapidly, but two trends that emerged in recent years - blockchain technology and the Internet of Things (IoT), are intersecting in game-changing ways in recent years. The overlapping of these two hot trends in tech is creating a new paradigm, offering unparalleled opportunities and challenges. With its network of interconnected devices, IoT has the potential to transform our everyday lives, making them more efficient and automated. Meanwhile, the advent of cryptocurrency introduces a layer of security, decentralization, and efficiency in transactions within this connected world.

This article explores the most innovative and impactful crypto projects in the IoT sector. By delving into these projects, we seek to understand how the fusion of cryptocurrency and IoT is shaping the future of technology and industry and highlight the potential benefits and challenges this synergy presents.

The integration of blockchain in the IoT space is significant for several reasons: 

1. Brings enhanced security to IoT transactions, utilizing blockchain technology's inherent features like immutability and encryption.

2. Offers a decentralized approach to device communication and data sharing, paving the way for more transparent and reliable IoT ecosystems. 

3. Crypto transactions can enable automated, real-time micropayments between devices, fostering new business models and application scenarios in IoT.

What Is the Internet of Things (IoT)? 

The Internet of Things refers to the network of physical devices – from everyday household items to sophisticated industrial tools – connected to the Internet, exchanging data and instructions. These devices, equipped with sensors, software, and other technologies, can communicate and interact with other devices and systems over the Internet. IoT has applications across various sectors, including healthcare, agriculture, smart homes, and manufacturing, promising enhanced efficiency, automation, and data-driven decision-making.

Cryptocurrency's Role in the IoT Ecosystem 

Cryptocurrency enters the IoT realm as a secure and efficient way to manage transactions and interactions between devices. In an IoT system, devices often need to exchange value or data securely and swiftly, and this is where cryptocurrency, underpinned by blockchain technology, becomes invaluable. It provides a decentralized, tamper-proof platform for executing and recording transactions, offering a level of security and transparency that traditional transaction methods cannot match.

The current trend of blockchain-based IoT projects explores the use of smart contracts to automate processes and payments, creating self-sustaining ecosystems of interconnected devices. The future potential includes the development of fully autonomous networks of devices conducting complex transactions and negotiations independently, further advancing the fields of smart cities, industrial automation, and more.

The synergy between cryptocurrency and IoT is not just about adding a layer of financial transactions to IoT systems. It's about enhancing the functionality, security, and scalability of these systems. 

By leveraging blockchain technology, IoT networks can operate more securely, reducing the risks of data breaches and cyberattacks. Smart contracts can automate processes, from supply chain management to automated billing, making systems more efficient and reducing the need for human intervention.

The following are some examples of successful integration of blockchain and IoT technologies: 

1. Supply Chain Optimization: Projects like VeChain use blockchain to track products from manufacture to delivery, ensuring authenticity and quality. Cryptocurrency payments integrated within these systems enable quick, transparent, and secure financial transactions across the supply chain.

2. Smart Homes and Utilities: Platforms such as IOTA facilitate secure communications and transactions between smart home devices. This technology allows for real-time energy trading and automated billing, creating more efficient and cost-effective home management systems.

3. Industrial IoT (IIoT): Projects like Streamr are developing platforms for real-time data exchange between industrial machines, using cryptocurrency for data monetization and ensuring secure, tamper-proof data handling.

Now that we've explored the potential that blockchain technology and crypto hold in powering IoT networks and tech, let's take a look at some of the best IoT projects leveraging crypto and blockchain: 

1. VeChain (VET)

VeChain is a blockchain platform that enhances supply chain management and business processes. Its goal is to streamline these processes and information flow for complex supply chains through the use of distributed ledger technology (DLT).

VeChain's native token, VET, is used primarily as the smart payment currency to conduct transactions on the VeChain platform. It is also used for staking and generating VTHO, which is used to pay for transaction fees and energy on the VeChainThor blockchain.

VeChain's Unique Features and Technology 

VeChain's most notable feature is its dual-token setup, consisting of VeChain Token (VET) and VeThor Token (VTHO). This system ensures that transaction fees are stable. The platform also uses a combination of blockchain technology and their in-house built 'smart chip' to track items throughout the supply chain.

Notable Partnerships by VeChain

VeChain has established partnerships with various multinational corporations, including Walmart China and BMW. This indicates significant market trust and adoption. 

VeChain's Growth Prospects in the Future 

The main challenge for VeChain lies in widespread adoption across different industries. Its prospects look promising, especially in industries requiring transparent supply chain management.

2. Helium (HNT)

Helium presents a decentralized blockchain-powered network for IoT devices. It aims to provide a wireless infrastructure for IoT devices through its decentralized approach.

HNT is used as a reward for operating Helium's decentralized wireless network, particularly for those maintaining the network's coverage and transferring device data. It's also used for transaction fees and governance on the Helium network.

Helium's USP and Technology 

The most distinctive aspect of Helium is its LongFi technology, which combines blockchain with a wireless protocol to deliver secure and wide-ranging coverage for IoT devices at a lower cost.

Notable Partnerships of Helium

Helium has gained significant traction, particularly in smart city projects. Its partnership with companies like Lime and Salesforce highlights its utility and adoption.

Helium's Future Prospects 

Helium’s main challenge is scaling while maintaining network security and reliability. Its future growth hinges on the broader adoption of IoT projects and smart city initiatives.

3. Fetch.AI (FET)

Fetch.AI is an artificial intelligence-driven blockchain platform that aims to connect IoT devices and algorithms to enable collective learning.

FET tokens are used to build, train, and deploy autonomous economic agents on the Fetch.AI network. The token also serves as a digital currency within the Fetch.AI ecosystem for various transactions and network operations.

Fetch.AI's Standout Features and Tech 

Fetch.AI uses autonomous agents to perform tasks like data sharing and decision-making, making it stand out in the IoT space. It leverages machine learning and AI to optimize these processes.

Fetch.AI's Partnerships 

Fetch.AI has partnered with various companies and projects, focusing on sectors such as transportation, supply chain, and energy.

Future Prospects, Challenges for Fetch.AI 

The primary challenge for Fetch.AI is the integration of AI and blockchain in a real-world, large-scale application. Its success depends on how effectively it can implement its AI algorithms in the IoT ecosystem.

4. IOTA (IOTA)

IOTA is a groundbreaking cryptocurrency and technological platform designed specifically for the Internet of Things ecosystem. Its Tangle technology is particularly useful for IoT applications that require numerous microtransactions.

IOTA's native token is used for feeless transactions and data integrity processes within the IOTA ecosystem, focusing on IoT applications. It facilitates machine-to-machine transactions, ensuring seamless data transfers and micropayments.

IOTA's USP and Tech

Unlike traditional blockchain-based cryptocurrencies, IOTA uses a unique infrastructure known as the Tangle, a type of Directed Acyclic Graph (DAG). This design is tailored to address the specific needs and constraints of the IoT environment, including scalability, energy efficiency, and the ability to handle a large number of microtransactions.

IOTA's Partnerships and Collaborations 

IOTA has established partnerships with various organizations and companies in the IoT domain. Notable collaborations include projects with Bosch, Volkswagen, and the City of Taipei for smart city solutions.

Future Prospects of IOTA 

IOTA is well-suited for the expanding universe of smart devices, offering a scalable and efficient solution for machine-to-machine communication and transactions. One of the main challenges for IOTA is achieving widespread adoption and overcoming skepticism regarding its unique non-blockchain structure. Ensuring network security and stability as it scales up is another crucial challenge.

5. JasmyCoin (JASMY)

JasmyCoin is a project that aims to provide a platform for the secure sharing of data among various devices on the Internet of Things.

JASMY is used as a utility token to secure and facilitate data sharing and transactions in the IoT devices network managed by Jasmy. It also serves as a means of compensating users for their data and enabling secure data storage and management.

Jasmy's Unique Features and Technology 

JasmyCoin's unique selling point is its focus on data democratization, giving users control over their data. It employs advanced encryption techniques to ensure data security and privacy.

JasmyCoin's Partnerships 

As a relatively new entrant in the market, JasmyCoin is working on establishing partnerships and expanding its use cases.

Future Prospects of JasmyCoin

JasmyCoin's challenge lies in breaking through in a competitive market dominated by bigger players. Its growth potential is linked to its ability to forge significant partnerships and adaptability to evolving IoT needs.

As promising as it sounds, the integration of blockchain and crypto technology into IoT infrastructure comes with its unique set of challenges: 

1. Scalability Issues

One of the primary challenges faced by blockchain-powered IoT projects is scalability. Blockchain networks, particularly those using proof-of-work (PoW) consensus mechanisms, can struggle with processing large volumes of transactions quickly, a necessity for IoT applications involving numerous devices. For instance, the Bitcoin network can handle only about 7 transactions per second, far below the needs of large-scale IoT networks.

2. Integration Complexity

Integrating blockchain technology with existing IoT systems poses significant technical challenges. The diverse nature of IoT devices, each with different capabilities and standards, makes it difficult to create a one-size-fits-all blockchain solution. This complexity can hinder widespread adoption.

3. Security Concerns 

While blockchain enhances security, IoT devices themselves can be vulnerable to physical tampering and cybersecurity threats. Ensuring end-to-end security in a blockchain-IoT ecosystem remains a daunting task, given the vast attack surface presented by numerous interconnected devices.

4. Cost Implications

The operational cost of running a blockchain, particularly energy-intensive PoW blockchains, can be significant. This cost factor becomes a critical concern in IoT applications that typically involve a large number of transactions and continuous data exchange.

Notwithstanding the challenges, a growth projection report by MarketsandMarkets indicates a positive trend towards the integration of blockchain in IoT. According to the report, the global blockchain IoT market size is expected to grow from USD 258 million in 2020 to USD 2,409 million by 2026 at a Compound Annual Growth Rate (CAGR) of 45.1% during the forecast period.

Here are some evolving trends we could see in the IoT sector of the crypto market: 

Emerging Solutions Could Address Scalability Issues

Innovations like sharding, where a blockchain is divided into smaller, more manageable pieces, and the development of more efficient consensus mechanisms like proof-of-stake (PoS) are promising solutions to the scalability challenge. For example, Ethereum's ongoing transition to Ethereum 2.0 aims to increase its transaction capacity and efficiency significantly.

Innovative Protocols will Ensure Better Security

As blockchain and IoT technologies mature, we can expect the development of more robust security protocols tailored for IoT applications. This evolution will likely include advanced encryption methods and more secure hardware for IoT devices.

Expect Improvements in Efficiency and Automation

Blockchain can enable more efficient and autonomous IoT systems through the use of smart contracts. These self-executing contracts can automate processes, reducing the need for intermediaries and increasing system efficiency.

The integration of blockchain with IoT holds immense potential to revolutionize how we interact with technology and manage data. Despite the current challenges, the synergy between these two technologies is evolving rapidly, driven by the demand for more secure, transparent, and efficient systems. 

With continuous technological advancements and an increasing focus on developing scalable, secure, and cost-effective solutions, the future of blockchain-powered IoT projects looks promising. As this integration deepens, it has the potential to unlock new possibilities across various industries, paving the way for a more interconnected and automated world.