Understanding the value of the integration of IoT and blockchain is easy to do especially when we think about different asset tracking use cases.

For example, shipping pharmaceuticals or various food substances often requires that the individual units are refrigerated and kept at specific temperatures until such time that the last retail customer takes ownership of them. Various organisations and vendors are already working on these potential scenarios using blockchain technology for immutable transactions and trusted shared visibility.

SAP is working with pharmaceutical companies to track drug shipments on a blockchain and one day this process could integrate with IoT sensors that ensure ‘safe’ temperatures are maintained while the drugs are in transit. Similarly, IBM announced the production launch of IBM Food Trust solution last week and it is already being used by WalMart to track leafy greens as it moves from farm to table.

IoT sensors may one day integrate with this process to ensure the lettuce is similarly kept at the right temperature. IoT will provide the monitoring and tracking infrastructure, and blockchain will provide a trusted way to audit whether the movement of goods complies with policy.

Of course it goes without saying that a lot of infrastructure, technology, integration, process and governance work must be done before this integrated blockchain/IOT scenario is production ready – for example adding sensors and ingesting detailed monitoring and tracking data via IoT, and scaling up blockchain technologies to support hyper-scale tracking of fine-grained supply chain events – but there’s little doubt that the marriage of these two technologies is quite promising.

Can Digital Twins implement Smart Contracts?

My colleagues W. Roy Schulte, Benoit Lheureux, Alfonso Velosa recently published a research note (see Why and How to Design Digital Twins) that explores the proliferation of ‘digital twins’ in the Internet of Things, in part because they reduce the cost and complexity of IoT and digital business systems. Figure 1 from that research compares a world without Digital Twins to one with them. It’s not a stretch to imagine digital twins one day being used to implement smart contracts on a blockchain that integrate and orchestrate systems of records, IoT devices and other necessary components into a blockchain’s distributed ledger.

Figure 1: Digital Twins


Many auxiliary services would also have to interface with these smart contracts, such as those that tapped into legal frameworks and transaction risk assurance in order for the environment to be business and network ready. But assuming these frameworks and infrastructure are established, more effective, efficient and trustworthy service and product delivery could no doubt be achieved.

*This article is reprinted from the Gartner Blog Network with permission. 

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