Why We Created IoTeX
Posted by Alina 9 months ago

Jan 26

Internet of Things

The Internet of Things (IoT) is rapidly emerging as the manifestation of the networked society vision — everything that benefits from a connection is connected. Despite its rapid evolution, IoT is still far from reaching mass adoption and lacks “killer applications” that would draw new users to the ecosystem due to issues such as low scalability, high operating cost, privacy concerns and lack of functional values.

IoT+ Blockchain

At the philosophical level, IoTeX is tackling this problem by introducing token economy into IoT spaces. We strongly believe that token incentives combined with community effort are the two key forces that will propel innovations in IoT space. Decentralization by design, like blockchain, is a natural fit for IoT applications:

  1. Blockchain is elastic enough to solve the scalability challenges of IoT in a cost-effective manner;
  2. Retaining data within well-scoped blockchains eliminates the concerns cloud-stored data will be potentially leaked or abused;
  3. Blockchain with smart contract has huge potential to enable the autonomous coordination of devices to create functional values.

What is IoTeX?

IoTeX aims to bring interoperability to IoT so all devices and systems can work together autonomously, at scale, to realize the full value of IoT. Almost all existing blockchains have limitations when facing IoT environments because they are not built to handle large quantity and heterogeneity of IoT devices and different constraints in computation, storage, and power.

We designed IoTeX to be the next-generation blockchain, purpose-built to handle the complex IoT world. We focused on scalability, cost reduction and privacy, the three big issues that limit the efficacy of other blockchain solutions. One of our core innovations is the blockchain-in-blockchain architecture. IoTeX consists of many blockchains that are hierarchically arranged:

  • The root chain, a public blockchain, manages independent sub-blockchains or subchains that run concurrently with one another while retaining privacy and interoperability;
  • Subchains are provisioned by developers/companies to connect and interact with IoT devices that either have a similar functional purpose, operate in similar environments, or share the similar level of trust.
  • On top of this structure, cross blockchain transactions are supported to transfer value and data from subchains to the root chain or from one subchain to another via the root chain.

To enable fast cross-blockchain transactions, we innovated a new PoS-based consensus scheme with instant block finality using Verifiable Random Function.

Privacy is core to the DNA of IoTeX. The privacy provided by Bitcoin and Ethereum is limited to pseudonymity; transaction details including amount and the assets are exposed to the public. In addition, the metadata of a transaction and its relationships with other transactions can be easily inferred. IoTeX enables built-in privacy-preserving transaction with our innovative, lightweight stealth address for receiver privacy, constant-size ring signature for sender privacy, and BulletProof for hiding transaction amount.

What is IoTeX Built for?

The IoTeX blockchain supports a variety of IoT ecosystems such as the sharing economy, smart home, supply chain management, and device identity management. IoTeX supports a diverse developer community including IoT hardware manufacturers, IoT device control systems, smart home apps, supply chain data integrator, data crowdsourcing vendors, and autonomous cars manufacturers.

The sharing economy has exploded in the last few years to encompass rides sharing, home sharing, bike sharing, and even small item level sharing like battery banks and umbrellas. IoTeX can power many sharing economy applications without the existing privacy issues and make the network decentralized and more efficient. For example, a smart lock could be installed on each shared bike which talks to a subchain powered by IoTeX’s root chain to facilitate pay-to-unlock, where the smart contract running on the subchain could be used for deposit and payment management without worrying about a centralized party could grab the money and run.

For smart home applications, the private cloud, backend infrastructure used by many IoT manufacturers comes with high maintenance costs and high risks of being hacked and leaking user data. In contrast, IoTeX blockchain manages the devices within a well-scoped subchain that interacts with a public chain only when necessary. It’s likely in 10 years that every home will be filled with hundreds or thousands of smart devices, all connected to a private subchain. Some devices will collect data at home and retain it on the subchain and some devices will consume the data to make the home “smarter.” Powered by IoTeX’s smart contracts, devices can be autonomously coordinated without human intervention.

Each IoT company can run its own ecosystem based on the IoTeX public chain and creates their subchain and token using IoTeX developer tools. Tokens can incentivize users to advocate for their application and stick with the ecosystem because as it grows, so does the value of the tokens they have. Their ecosystem expands rapidly because each user can be their marketer as well. IoTeX empowers IoT companies to reconstruct their businesses using blockchain technology to benefit from the fast growing global token economy.

What is the Future of IoTeX?

IoTeX will be the foundation of the technology, economy and ecosystems of the IoT world. IoT organizations will construct or reconstruct their business models and ecosystems using IoTeX blockchain. In this system, users are not only the consumer of IoT devices but also the advocates, marketers, and even service providers. The key tenet is their decentralized network in which users own their own data.

Like any evolving ecosystem, those that continually provide value to users will last forever, those that don’t will naturally diminish as users and miners move to more lucrative subchains. Early adopters stand to benefit the most due to token appreciation, since they’ve held the tokens the longest, they stand to gain the most from its success and can contribute computing resources if they think it’s a project that will succeed.

We are excited to provide a foundation on top of which the potential of IoT can be realized. Please join us in building the future connected world.

The IoTeX team

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