My personal takeaway from the Blockchain Mobility Hackathon

Our great Pac-Man on wheels team at work. The four guys at the table in the front (FLTR Michael Karl, myself, Martin Mihaylov and Dr. Simon Hassannia)

During the Blockchain mobility hackathon, I had lots of great discussions with different people about IOTA. However, I sometimes got the feeling that most people still believe it will take like 5 or 10 years for IOTA to be used in real-world applications. I definitely can’t predict the future, but I think that a lot of problems, which were mentioned around IOTA can be solved today. For example, the project we developed during the hackathon “Pac-Man on wheels” (see our project on Github) can in my opinion easily be used in a real-world application right now.

In this article, I will list some of the problems mentioned during the hackathon as well as possible solutions.

Problem 1: MAM isn’t finished and therefore you can’t exchange data securely

MAM (Masked Authenticated Messaging) is in an early stage. It’s not proven to be completely secure and it’s missing some key components like a key exchange. However, there are plenty of secure asymmetric cryptography systems out there, like RSA and all of them can be used together with IOTA. So, if you completely trust these systems you can start using them right now!

The reason why we decided to use NTRU in our project “Pac-Man on wheels” is simply that we wanted to use a quantum secure encryption. We believe anyone who is currently using an encryption systems should think about applying a quantum secure systems no matter what technology or cryptocurrency you are using. See for example “How secure will our data be in the post-quantum era? It’s the end of modern cryptography as we know it, and we feel fine.“

Problem 2: You can’t exchange huge amounts of data efficiently with IOTA

It’s true that you need to do multiple proof-of-works for uploading a huge amount of data and that this process is inefficient compared to the current state. But why would you want to upload your complete data to the tangle? It’s enough to upload just a link to your data and if you use IPFS to upload a unique hash instead of the link this solution is also completely decentralized and future-proof.

If you want to test IPFS together with IOTA feel free to use my public IPFS gateway. You can even use the following API to pin content, see https://ipfsnode.de (for testing only ⚗️). If you’re a C# developer take a look at the Chiota Code as well as my wiki entry.

Problem 3: You won’t get paid for your data with IOTA because you can’t setup smart contracts

Qubic is at an early stage and you can’t use it right now in a productive system. However, the great thing about IOTA is that you don’t need smart contracts for most IoT use cases. Imagine if you want to sell some data, which is valued at 1€. With IOTA, you can offer an interested party a first part of the data, for a portion of the value (e.g 1 cent). If you get the money via IOTA microtransactions you can continue to offer the next part of the data (worth another 1 cent for example), if not, you simply stop the transaction, and you have lost 1 cent. A system like this can easily be set up today.

Problem 4: IOTA isn’t decentralized and potentially never will be

At the moment, the tangle still has a centralized coordinator to be secure against attacks. This way you can argue that the system isn’t completely decentralized. Since the details about the potential solution called “Network-Bound Proof-of-Work” aren’t fully published yet (you can take a look at the “Radio Resource Testing” part of the this paper if you’re really interested in it), I agree that it’s difficult to completely trust in this explanation at this stage. However, in my humble opinion, there is more than one solution to this problem, which at least could work as a potential answer for the current setup. For example, if it turns out that the “Network-Bound Proof-of-Work” doesn’t work, you can simply decentralize the coordinator (similar to EOS). Furthermore, there are already other concepts for direct acyclic graphs researched (e.g. SPECTRE or Algorand), which might have interesting solutions for IOTA as well.

IMHO: That’s why I strongly believe it’s only a matter of time before IOTA is completely decentralized and I think you can start using IOTA for decentralized data exchange today!