IBM patents blockchain-based smart contract solution for IoT networks

IBM claims its blockchain patent could transform IoT networks

IBM has patented what it claims is a new solution that combines blockchain technology with Internet of Things networks to help manage smart contracts.

According to Coindesk, the company has developed a secure method of creating and deploying smart contracts, which could improve the way transactional regulations and conditions are constructed.

The company's method makes it easier for blockchain technology, which is essentially a distributed database of records, to be used over an IoT network, or so IBM claims.

"This application relates to using proof-of-work operations, and more particularly, to using values to determine a proof-of-work scheme," describes IBM.

The company added that it wanted to create a solution to that can tap into the growing blockchain and IoT ecosystems.

"In a blockchain configuration, a large amount of information is related to financial transactions. As the popularity of the blockchain configuration continues to increase so does the desire to implement additional functions on the blockchain," explained IBM.

"For example, when determining information on the blockchain for smart contracts, the values used to calculate the information may be derived based on a particular random set of values. However, it may be optimal to use values which are based on other known sources of information."

It claims that the solution fixes two common challenges experienced by this combination of technology, with the first being the computational limitations of blockchain IoT networks - as blockchains become bigger, performance issues mount.

Another challenge is that they could become targets for sophisticated hackers. IBM believes that the answer lies in introducing a limited proof-of-work system.

"A blockchain configuration may be used to store a distributed ledger for information security and accessibility," claimed the firm.

"One example method of operation may include determining a proof-of-work via a device and using a predefined set of nonce values when determining the proof-of-work, storing the proof-of-work on a blockchain, and broadcasting the proof-of-work as a broadcast message."

The filing shows that the objective here is to "provide equal chances of successful completion of proof-of-work to all IoT devices in the network".

Although this is only a concept at the moment, the company said it could eventually be used in "peer to peer (P2P) energy networks, logistic networks, crowd-sourced weather networks, and the like".