When blockchain meets Internet of Things: Characteristics, challenges, and business opportunities

Researches in Blockchain Technology (BCT) and Internet of Things (IoT) are experiencing exponential growth in recent years. They are being witnessed as mainstream technologies that have the potential of revolutionizing our society. However, these two contain technologically unrelated in philosophies. This article has a special interest in exploring how BCT and IoT can benefit in innovating business models. The purpose of this work is to understand the state of the art how BCT can be utilized within IoT context to create secure decentralized architecture. IoT is not secure by design, making its applications vulnerable especially to security and privacy threats. This hinders the proliferation of IoT applications in a large scale. With BCT capabilities, BCT can be used as integral part that can solve many shortcomings of IoT applications. Thus, existing businesses can be improved, and new business models can be brought into reality. Eliminating the need of third parties to guarantee trust of business transactions is a significant value towards business innovation in many areas, such as digital supply chain, vehicular systems, surveillance systems, and the creation of new business models, e.g. sharing economy, local energy trading, smart city, to name but a few. In an effort to understand the state of the art, this article (1) highlights intrinsic characteristics of IoT, (2) describes BCT modes and their characteristics to be considered for IoT integration, (3) presents a comprehensive survey on business opportunities based on the usage of BCT and IoT from a wide variety of literatures, (4) analyse strengths and weaknesses, and (5) discusses research possibilities that can be a solution to the problems. This paper will serve as a good starting and reference point to new researchers or those who are interested in adopting these technologies in businesses.