Some of the amazing things that happened in blockchain technologies in 2018, and what they mean for the coming year
Now, I’m beginning with the assumption that most of my readers will be a bit puzzled about how blockchain technologies even relate to smart cities, smart homes or even that horrible ‘Google Dot’ thing my daughter is demanding for Christmas. Well, let me explain.
First, we have to define what ‘Smart Cities’ really means for 2019. With a few very notable exceptions (Dubai, Singapore and perhaps Songdo) there really are no truly ‘smart’ cities, nor will there be by the end of 2019. However, we are seeing a great many ‘Smart’ projects being rolled out or at least heavily piloted in urban settings all over the world. These are increasingly being addressed under the banner of ‘Smart City Technologies’, and I believe this is for the good.
Rather than a mere watering down of the term, these are the technologies which must be reliably developed before smart cities can form organically, from the ground up rather than being imposed from the top down. The top-down approach was never practical for most of the world’s cities anyway.
2019 will indeed see more aspects of everyday city life being automated or at least streamlined using these Smart City Technologies. Streetlights that can talk to each other, assessing traffic flows and adjusting their timing to make rush hour less of a nightmare become possible, if not standard. Power grids will be able to configure themselves differently on a hot afternoon in mid-summer than on a breezy day in the autumn. Huge, expensive civil processes can be directed by fewer people, and can become more responsive to actual on-the-scene conditions. The whole process might even make money in the end, rather than cost money.
That last bit sounds a little too utopian, doesn’t it? But read on, it really isn’t out of the question.
Well, one thing Dubai, Singapore and Songdo have proven is that the physical technology for smart cites exists, works, and is in some senses of the term economically viable. However, these projects have also shown us that the data created, used and stored by all this automation can be a real stumbling block. It is a huge security problem, and many towns and cities won’t give ‘smart’ infrastructure a second look until it is addressed fully, effectively and with a bit of finality.
That’s where blockchain is coming to the fore. Not as a traded commodity, but as a data collection, routing, use and protection technology.
OK. Let’s really get utopian for a moment. Imagine you live in a ‘proper’ smart city. One with mature, tried and tested technology that has been though all of its wobbles and ‘just works’.
You go into a shoe store. The shop recognised you coming in, perhaps via face recognition, perhaps by your phone’s loyalty app pinging them at the door. The store’s AI queries the city’s database, and in milliseconds knows your shoe size, what styles you tend to like, and how you usually pay. Perhaps an attendant brings examples out for you, or perhaps you tick them off a touch screen. You make your selections and leave, knowing the store and your bank will sort out the money, and your purchase will be delivered in time, perhaps by automated courier.
You get in your car – or perhaps the city sent the nearest car as you finalised your purchases, knowing that it would be the most efficient way to keep traffic moving. You declare your destination, and it whooshes you off without you needing to consciously pay the fare, tolls, or even for parking. You probably have subscriptions services for all of those anyway.
That’s how it could one day work. Not in 2019 (unless you live in Yinchuan, China), but still.
Now let’s get dystopian. Less Star Trek and more Altered Carbon. Imagine how all of that could go badly. I won’t lead you through it – the more pessimistic among you have been doing that since I used the word ‘utopian’, and rightly so.
For all of this to work, it has to use Amazon’s or Google’s approach to monetising your data, but without the overwhelming sinister tone. Point one is data security, and without that there never needs to be a point 2. If visitors and residents don’t have absolute confidence that their data will be collected and stored securely, they won’t fully participate and it all falls apart in a jangled mess of poorly targeted spam and checkout clerks offering you store credit cards at the till.
Now, blockchain can’t address the ethics of the government or the companies involved – that’s still up to you. However, it does offer the possibility of leaping the data security hurdle so that asking the next big set of questions is relevant.
Advances in blockchain technology – such as the MXProtocol, which I’ll address later – are making the IoT streamlined, efficient, decentralised and yet non-hackable. Contracts are becoming unalterable, coded and pre-programmed transactions which happen in an entirely predictable way (better still, a way that doesn’t involve lawyers, beyond the advice you should get before clicking ‘agree’).
I’ve already written about smart contract technology, but it is worth stressing how the blockchain can be used to make smart contracts work as incorruptible, living documents – self-executing code that aren’t, like traditional contracts “promises to do something and agreements as to what the penalties for breach might be dependent on who has the better lawyers” – they are reliable expressions of what will actually happen and when.
Ethereum, Rootstock, MXC and others have made great strides in making smart contracts secure and practical, and they really are catching on. In America, the US government’s Commodity Futures Trading Commission operates a ‘fintech innovation hub’ called LabCFTC. LabCTFC has just released what they call a ‘primer on blockchain-enabled smart contract technology’. Now, this is no light read, but the future it points to is a very interesting one.
In Yinchuan, for example, you don’t need ID, a credit card or cash. You can shop with a smile, as facial recognition apps recognise who you are, link to all of your accounts, licenses and permissions securely through blockchain technology, and your purchases get delivered according to the preferences you select with a mobile app.
China is looking into using a host of blockchain technologies to solve their centralised data storage and security problems, and are fine-tuning a ‘national standard plan’ to implement them. The solutions utilising MXProtocol and similar technologies could allow the formation of whole ‘smart countries’ made up of ‘smart cities’ and, one assumes, quite a bit of ‘smart countryside’ – though that would require a very robust mobile data infrastructure!
Let’s look at Smart Dubai a bit more closely. Whilst they aren’t totally ‘there’ yet, the goal is to drag the UAE kicking and screaming into the 21st century with a completely paperless ‘digital space’where eventually all documents, private and public, will be conducted electronically. This will require the implementation of more than 500 separate initiatives, but they’ve been working on it since 2014, and they’ve made huge advances.
One example is the pilot program whereby goods imported to or exported from Dubai are tracked, shipped and delivered using totally transparent, non-hierarchical and completely reliable blockchain technology. They say it will save more than 25 million man-hours and eliminate something like £1 billion of expenses just by automating the processing of the documents. The fact that the government building s where this was traditionally handles will be all but free from queues is icing on the cake.
Now, let’s look at Estonia. ‘Estonia?’ you might say. Indeed. They suffered a massive cyber-attack in 2007, and started work on a solution. Ever since 2012, Estonia’s commercial, security, legislative, judicial and national health systems have been exchanging data based on distributed ledgers.
Today virtually every Estonian can view and control who accesses their data. They can even challenge illegal or unwanted access. If some city official goes nosing around their records without authorisation, they have undeniable proof, and can prosecute. It actually works, and had for nearly 7 years.
If that sounds like a huge amount of blockchain-secured data whizzing about overhead, it is. But, with next generation LPWAN technical, data use and monetisation solutions like MXProtocol and others this becomes more than practical – it becomes efficient and highly profitable.
I’ve written about this as well. You can expect to see things happening in the very near future here. With MXC’s recent successful ICO, you’ll see the MXProtocol’s unique monetised gateway system really take off. This is a system whereby you can set the priority of your IoT data on a shared network by effectively bidding for use.
Sound complicated? It’s really not. There is a good video explaining it here.
It’s a bit like Google AdWords. Some of your data must get through straight away. The telemetry form a heart monitor of the signal that tells you a car is being broken into. You bid high, and you pay as much as you actually need to for the priority.
However, some of your data can wait. The daily ping about how frequently the soda machine in the lobby vended a particular soft drink, whilst important for tomorrow’s restocking run, can wait a few minutes for the network to slow down. In that case you bid low, and pay dramatically less. If you’re really interested, you can read more about it on their website’s Use Cases section.
This may not seem as dramatic or world-changing as the other examples, but it is also the kind of technology that actually does change everything. It is a bottom-up approach that is self-funding, effective, practical and will in time make really efficient, self-organising IoT networks huge, sprawling and ubiquitous. Without a foundation like that, smart cities can never really be built.
They might not all bear fruit before 2020, but many of them will, and the rest won’t be far behind. Keep an eye on currencies like MXC and Ethereum which are built to be tied into smart contracts, and look out for massive, multi-user LPWAN solutions for the next generation IoT as well.