Can Bitcoin Technology Help the Internet of Things?

There is no doubt that although many people still only associate the decentralized digital currency with criminal activities on the dark web, Bitcoin has gradually become mainstream. More and more large companies and well-known investors have become interested in Bitcoin and even directly involved in Bitcoin businesses.

Bitcoin has so many facets that it's hard to define exactly what it is. Is Bitcoin a protocol? A network? Or an open source software platform? Its main value is that it allows real-time transactions online without the need for a centralized payment system, just like email does for information transmission.

Since Bitcoin has a built-in scripting language, it is a programmable language. Its underlying technology, blockchain, can even lead to innovations in the financial field.

Bitcoin and the Internet of Things

In the Bosch IoT Lab, we view the IoT as a system that can turn almost every physical object in the world into a computer connected to the Internet. When studying the business model of the IoT, we can quickly think that "almost every physical object" can also become data that operates autonomously in a global data market. The market means that data can be exchanged for money.

For example, an organization installs a nationwide sensor network to monitor parking space usage. The infrastructure costs a lot of money, but the information is very valuable to many interested parties. As you drive around looking for a parking space, you can open an app to view real-time information about parking spaces from more than 20 sensors.

There is a fee for using this information, so how do you pay for it? Suppose there is an agreement between the service provider and the provider of the sensor infrastructure. As a user, you must subscribe to the service provider, otherwise you will have to pay for it with your personal data when you use the application. But there is another way: since the sensor provides us with data information, we can pay the sensor directly. This is where Bitcoin comes into play.

Bitcoin is open to everyone, so every sensor can have its own Bitcoin account, free and without human intervention. How much is a data set worth? Probably less than a penny. Although I doubt whether traditional payment systems are capable of managing this currency efficiently, there are already many developers (Bitcoin is open source) working on developing micropayment systems that use Bitcoin for transactions.