Blockchain and 5G: Obstacles and Opportunities
What is Blockchain Technology?
As far as emerging technologies go, blockchain technology has arguably generated more buzz than any of the others. In its short time underpinning several cryptocurrencies and decentralized applications, this database platform has garnered the attention of various industry leaders, policymakers and large organizations willing to invest in its development. As an example, IBM already has more than 100 pending blockchain patents, and corporations like MasterCard and Visa are in similar boats. But what exactly is a blockchain and what’s so special about this technology?
A blockchain is a type of peer-to-peer data structure for storing transactional data in containers known as blocks. As the name suggests, these blocks are linked in a chain and secured using cryptography. They mostly function as a supporting technology for systems in which a token is exchanged between several parties, or data concerning a particular object is entered and stored.
How Does Blockchain Technology Work?
This technology is considered incredibly useful in different industries due to benefits like security, transparency, immutability, privacy, and the elimination of the need for third parties and a central authority in any process.
Blockchains are secured through consensus mechanisms which ensure that every transaction entering the blockchain is valid. Depending on the architecture, the presence of consensus may vary. In public blockchains, consensus is achieved through any of the currently available mechanisms such as Proof-of-Work (PoW), Proof-of-Stake (PoS), Delegated Proof of Stake (DPoS), or any of their many variations. Private blockchains mostly do not require consensus since a single entity owns and presides over them. Consortium or federation blockchains only require consensus from member organizations.
Either way, the basic principle behind consensus is simple. Let’s assume that 5 people are in a room and two of them (Person A and Person B) exchange $5. For that data to be considered valid and on the record, the other people in the room must agree that the transaction really occurred. However, on peer-based blockchains where there are thousands of active users, a word-of-mouth confirmation by every single user is impossible. This is why special mechanisms which account for the scale of blockchains are used to achieve consensus.
The immutable quality of blockchain lies in the properties of every block. Each one is marked with the hash number (a unique cryptographic identification) and a time stamp. Changing any data in the block will change the hash number and disrupt the other blocks. This is why blockchain is considered tamper-proof as a database. As for transparency, anyone can audit transactions on a public blockchain like that of Bitcoin by using a block explorer. This makes it easy to carry out many different blockchain applications without the fear of transactions being manipulated within a closed system.
Current Applications of Blockchain Technology
Initially, the only application of blockchain technology was to power systems like Bitcoin, Ripple, and Stellar, which allow people to send their assets from one place to another in the form of digital currency. But in its ten years of existence, a lot has changed as far as blockchain applications go.
The introduction and implementation of smart contracts, first mentioned by Nick Szabo in 1997 on the Ethereum blockchain, paved the way for other applications of the technology. Smart contracts are automated self-executing contracts which function without the interference of any external party once initiated. They are programmed with a set of conditions and execute when those conditions are met.
As a result of the existence of smart contracts and their combination with blockchain, the technology has fascinating use cases in other industries. One example is in real estate, where several individuals or corporate entities can share ownership of assets. This means that they can allow people to buy a share in a property and earn profits as market prices rise. These assets can also be transferred to other parties and all such transactions are facilitated by smart contracts while cryptocurrency tokens are used as the equivalent of stock.
You can apply the same principle to art and almost any other financial or high-value asset. In entertainment, the presence of middlemen in the distribution chain reduces the amount of money paid to content creators. Blockchain platforms like TRON, BitSong, and VOISE ensure that money goes straight to the content creators without the intermediaries. In the food and shipping industries, it is used for supply chain management and to gather data on the origin of food or shipments. This provides accountability within both industries in the case of food contamination or missing goods.
In the future, blockchain may be used to prevent identity theft, facilitate voting, or even enhance online gambling systems. It could also be combined with other emerging technologies like 5G for various Internet of Things (IoT) applications.
What is 5G Technology?
1G, 2G, 3G, and even 4G are familiar terms for anyone with a mobile device. These terms are used to show different generations of wireless technology. 1G was known as analog cellular technology, the first of its kind. 2G was the first digital cellular network and came in the form of GSM, CDMA, and TDMA. 3G improved upon existing speeds while operating at 200kbps to several megabits per second in the form of HSPA, EVDO, and UMTS. 4G was released with even greater speeds of up to hundreds of megabits and Gigabits in the form of LTE and WiMAX.
For those with mobile devices, the arrival of 4G technology was epic. The speeds it advertised had never been seen, and soon it became commonplace. Today, there's a new kid on the block.
5G technology is an improvement on existing mobile wireless networks, which promises faster speeds, lower latency, and better connectivity than its previous counterparts. The high speeds will allow the network to move more data while the low latency will improve the responsiveness of the network.
Although wireless network generations are usually not backward compatible, early versions of 5G networks will be compatible with 4G. Soon after, when there are more 5G devices and applications, a non-backward compatible version will likely be released.
How Does 5G Work?
Most generations of wireless technology have distinct differences in properties like speed, capacity, and breaks in their encoding, known as air interfaces.
Similar to previous generations of cellular networks, 5G uses a network of cell sites consisting of towers which send encoded data through radio waves. Every site is connected to a single point which acts as a support for the network of cell sites, through wired or wireless connections.
Like 4G LTE network, 5G uses OFDM encoding for data. However, in the latter, the architecture promotes a higher level of flexibility and lower latency, which leads to higher speeds. They also have more cells and require larger airwaves than previous generation networks, to carry the amount of capacity and smart applications they are designed for.
5G will operate on channels of about 100MHz and up to 800MHz when bonded up. This is far larger than 4G network channels which fall between the range of 20MHz and 160MHz bonded up.
Where is 5G Available?
The 5G network is already available in several places across the US as telcos race to implement it.
- According to AT&T, its network is now available in 19 US cities where it is currently running tests. The cities are Atlanta, Charlotte, Dallas, Houston, Indianapolis, San Francisco, Jacksonville, Louisville, Oklahoma City, New Orleans, San Antonio, Waco, Las Vegas, Los Angeles, Nashville, Orlando, Raleigh, San Diego, San Francisco, and San Jose.
- Sprint has also announced that it is improving upon its 2.5GHz network for 5G use and preparing all of its cell sites for 5G. T-Mobile hopes to implement 5G this year, via its 600MHz and 28GHz network bands. A roll out across the country may happen in 2020. According to Verizon, it has implemented “millimeter wave 5G” for use in its existing home 5G broadband and will have also have a mobile network version available this year.
- Several 5G phones have also been released, such as Samsung Galaxy S10 5G, ZTE Axon 10 Pro 5G, Samsung Galaxy Fold, LG V50 ThinQ, OnePlus 5G Phone, Huawei Mate X, and Xiaomi Mi Mix 3 5G. This means that people will have to get new devices to try out the network when its applications become more popular. Qualcomm already has chips designed for compatibility with 5G.
- Europe isn't left out as OnePlus gears up to release the continent's first 5G-compatible phone in spring. Huawei is making plans to do the same for Asia. Despite current releases, rollouts for the public will likely happen in 2020.
- According to Canada's Telus Mobility, 5G will be available to its customers in 2020 but will likely roll out in Vancouver earlier than other cities. Rogers Communications is investing $4.7 billion USD in 5G technology development in 2019 and will create a test site on the University of British Columbia campus during the same year.
- Puerto Rican Wireless provider Claro will possibly release its 5G network between April and June 2019.
- LG Uplus' has already gone live with its 5G network in Seoul and its surroundings. Currently, the company has positioned more than 4000 5G stations in Incheon, Seoul, and Gyeonggi, and planned to deploy more than 7,000 by the end of 2018. Their plan to release 5G infrastructure to the general populace in major cities by 2020.
- Heo Won-Seok, the ICT and Broadcasting Technology Policy director at the Ministry of Science and ICT, has stated that 5% of South Korea's mobile users will be using the 5G network by 2020, and up to 90% by 2026.
- Japan’s largest wireless network provider, NTT DOCOMO is experimenting with 5G and has been doing so since 2010. The company plans to launch and plan to launch “pre-commercial 5G network services” by September 2019 and commercial services in 2020.
- Zain and Ooredoo, two of the largest telecommunication companies in Kuwait have released their 5G services. Zain announced its launch in June 2018 and a few hours after the announcement, Ooredoo made a similar reveal.
- 5G will soon be available in the United Arab Emirates through Etisalat UAE and Du. The former made a deal with Huawei in February 2019 to offer “5G wireless, 5G service oriented core and a 5G-ready transport network to facilitate smooth 5G technology adoption.”
- Like many other countries, Vietnam is aiming for a 5G release in 2020. According to Viettel, the country's largest state-owned telecommunications company, they will carry out 5G tests throughout 2019 and will likely introduce the network the following year.
- Vodacom Group launched its 5G network in Lesotho, South Africa, in August 2018. The company was also the first to provide 2G, 3G, and 4G, networks in the country. The company is using a fixed wireless access (FWA) network in the 3.5 GHz band.
The Significance of 5G Technology
The high speeds provided by 5G network will allow for more than just uploads and downloads like other wireless networks are used for. Everything from enhancing artificial intelligence, culling big data, enhancing internet of things devices which connect to other devices to carry out tasks, connected networks of towns and cities could become reality. Today, these things are not happening because internet speeds and capacity are not high enough and don't have a low-enough latency.
4G cannot handle the interconnection of IoT devices because their design makes it expensive, and consume a lot of power. To really support large scale connectivity between devices, the network must at least be inexpensive and 5G may be the solution. The 5G network is not only inexpensive, but it also allows connectivity on far more devices than 4G, especially for low-powered devices and sensors.
Future Implications of 5G
The potential future applications of 5G technology are limitless. By design, it can be combined with many different technologies that are currently progressing at a slow pace due to the lack of supportive infrastructure. It can also enhance other more established technologies. Some examples are virtual reality, driverless cars, and mobile internet.
5G may give virtual and augmented reality a boost by providing the type of fast internet and low latency they require to function on the go. Since 5G will basically convert home internet routers into cell sites, coverage will increase. As a result, more mainstream applications of VR and AR will be possible.
Driverless cars are one of the decade’s most fascinating inventions. Unfortunately, they may not reach their full potential due to network constraints. Such cars need to communicate with other cars as well as smart roads to maneuver traffic and ensure safety. This requires high speeds and low latency since communication, in this case, involves cars sending small packets of data instantaneously. The latency of 5G network is low enough for transactions to bounce back and forth between cars in as little as milliseconds.
5G internet has a much higher capacity than 4G and can easily meet the demand for huge capacities, that the latter can’t.
What Combining 5G and Blockchain Technology Looks Like
The unique properties of blockchain such as security, transparency, and immutability, combined with the speed, low latency, and ability of 5G to connect to more devices, could have potentially amazing results for a number of applications. One such application is the connectivity of the Internet of Things (IoT). The IoT has existed for several years and has interacted with blockchain technology in several instances. One example is IOTA testing the communication between a mini-Tesla and a charging point over its network. However, progress within the field has faced three major challenges: speed, capacity, and security.
How Will it Work?
According to McKinsey, 5G platforms can move more data in a shorter amount of time, allowing many of these low-powered IoT devices to communicate with each other. This solves the issue of speed and capacity, with the added bonus of connectivity, low energy consumption, and cheaper costs.
A blockchain network has the type of high-level security required for IoT applications to function properly. It almost fully eliminates the risk of transactions getting hacked because such device networks won’t have a single point of failure. More than 4.5 billion people use mobile phones globally, not to mention other devices that will likely communicate with others.
Security has to be tackled with scalability in mind and blockchain technology could provide it. Also, there has to be a way to validate the transactions between each device. The decentralized consensus used by blockchain can form the foundation of a fully functioning IoT 5G system. Blockchains also benefit from this combination since the users of IoT devices will indirectly adopt it.
Other Practical Applications of a Blockchain and 5G Combination
Internet of Skills
One new Internet of Things sub-are that will benefit from a combination of 5G and blockchain technology is the Internet of Skills (IoS). This field looks deep into devices and methodologies that allow people to carry out actions remotely. Essentially, many high-value tasks can be performed from anywhere in the world. For example, knowledge can be acquired remotely via online courses by anyone with an internet connection. This is IoS in its basic form. Another example is a doctor performing complex surgery on a patient without being physically present. The technology is usually supported by audio, visual and haptic technologies which have to be connected throughout such procedures.
However, existing wireless networks don't have low enough latency for fast communication between all parts. This is where 5G comes in. During a medical procedure, every second counts and a lapse in time could translate to terrible consequences for the patient. This is why the speeds that 5G provides are a better fit. Blockchain technology ensures that the procedure isn't disrupted by malicious external parties such as bots. The high level of security will give patients more confidence in the procedure.
Real-time Supply Chain Data
The increasingly volatile economy, globalization, and the challenges faced during outsourcing have overpowered the basic automated supply chain model. Merely having a supply chain which updates itself long after the events have occurred on the chain just doesn't get the job done anymore. Due to the presence of so many moving parts, it is difficult to keep track of everything happening.
If people are able to enter data into the supply chain in real time, tracking becomes easier. The data can also influence decision-making. However, real-time supply chains require seamless communication and connectivity to work well. Blockchain offers a secure, private network on which to host a supply chain. Data is entered and validated in real time through consensus.
5G network speeds, capacity, and latency underpin the network to ensure that there are no lags. While this sounds relatively easy, it isn't. Synchronizing details in a supply chain when dealing with many products and large organizations is a challenging task. Ideally, a supply chain should be able to accept and read data to detect changes in facts such as supply and demand, price, and the business climate. This data is used to make informed decisions about the next course of action for a batch of products. Without structures that can support such a system in place, business (especially international business), becomes less efficient.
Using a blockchain and 5G as the backbone for a real-time supply chain will increase the amount of flexibility within the system. It will also ensure that different arms of the chain can easily analyze market changes, costs, prices and risks to avoid loss in the long run.
5g and blockchain will also help with smart contracts by allowing better connectivity between blockchains and oracles. A smart contract will only execute when a set of predefined conditions are met. But how does the smart contract know when to execute this event? Simple. Through the use of oracles. An oracle is a relay agent that finds and validates real-world data that can be used by a blockchain, to facilitate a smart contract.
Because they act as a data feed for smart contracts, high-speed internet is required. They also need low latency to be able to feed the contract continuously in real time. 5G offers these and could make access to such advanced supply chains possible for those in remote areas.
Oracles are part of multi-signature contracts where for example the original trustees sign a contract for the future release of funds only if certain conditions are met. Before any funds get released an oracle has to sign the smart contract as well.
Secure Data Transfer
Using 5G wireless networks, data can be sent from one device to another at high speeds. With IoT devices set to increase in the coming years, a challenge in securing the data bouncing around so many devices has become apparent.
Blockchains are distributed data-storage structures, yet they are not optimized to store that amount of load. This makes it infeasible to store IoT transactional data on the blockchain. However, such data can be stored in other decentralized file systems that support blockchain data such as OrbitDB or the InterPlanetary File System (IPFS).
While the data itself is stored on these systems, a unique cryptographic number known as a hash number can be stored on the blockchain as a pointer to where the data files are stored. Tampering with the data will cause the hash to change and draw attention to the attack. This method of storage may not be sufficient to protect the data fully, but it will provide better security than most centralized options available.
Automation will allow artificially intelligent robots to carry out the most mundane tasks in homes and industry. Autonomous cars and smart homes are part of this automation sweeping across the world quickly. Blockchain and 4G offer a way for such smart objects to collect real-time data and self-improve. Some of these objects include:
Tesla is one of the most popular examples of a smart car; one of its main features is autopilot. To successfully run its autopilot feature, a smart car would have to sense traffic, stops, direction, location, and the terrain. Although Teslas can effectively sense any of these things, imagine the possibilities with an even faster network.
More features and more accurate driving can be expected from smart cars that can collect and analyze data in real time at super-high speeds. They may also be able to interact with other smart cars on the road to share data.
Essentially, a “smart home” is equipped with smart devices that improve the living experience by automating many tasks that humans would otherwise handle manually in the home. These devices can include speakers, computers, cameras, smart appliances like fridges and washing machines, televisions, security systems, smartphones, and more.
Like smart cars and cities, these devices have to continuously interact with their environment and in some cases, other devices. Facilitated by 5G network and blockchain technology, data can be collected and stored securely at high speeds in real time.
Smart cities are urban areas that collect real-world data using Internet of things (IoT) sensors and then use this data to improve the lives of its citizens. By continuously collecting data, cities can be better informed on how to make their infrastructure and processes more efficient. For example, smart roads can collect data from vehicles and traffic pattern and send it to a device where it is stored.
Such data can give city authorities a better idea of how to solve any traffic challenges. Anything from energy creation to air quality and environmental control can be improved through data collection via IoT devices. These devices cannot connect with each other and send data at a fast rate between themselves without the help of 5G.
Replacing Human Labor with Automation
The subject of replacing human labor with automation has been around for a long time. In many industries, it costs corporations less (long-term) to automate several industrial processes. For example, Cainiao, an Alibaba-owned logistics firm had over 700 robots in its warehouse to take on the workload of Single's Day, its annual buying event.
According to a report by CNBC, the company dealt with over 800 million transactions during the Single's Day event in 2017. Finding human labor sufficient to handle such a task would expensive when considering how many people would be required. Many more robots are being developed to take on far more challenging tasks. Although there have been many advancements within the space, there are also challenges with connecting devices. 5G network could improve connectivity across the board.
Network and Technological Improvements to Databases
The range and bandwidth of blockchain networks and other databases can be improved by 5G due to its low latency, and capacity. If there are no speed problems, more nodes may be encouraged to join the blockchain.
5G will also allow blockchain to reach more remote areas and improve its ability to connect to mobile devices such as phones and tablets. With more nodes on the network, there could be better decentralization and in turn, better security through consensus. Lower latency periods will allow for experimentation with block times and sizes. In conjunction with high speeds, it may also allow for better applications of the technology in cases such as remittance.
Challenges and Obstacles Faced When Combing 5G and Blockchain Technology
As stated earlier, 5G has several qualities which make it a perfect supporting technology for various real-world applications including the Internet of Things and its sub-areas. Unfortunately, there are drawbacks that manufacturers have to overcome before the use of this technology can truly be seamless.
The first major issue is that of security. With an estimated 10 billion IoT devices by 2020 and 22 billion by 2025, it stands to reason that there will be a significant number of malicious devices. Such devices could lead to chaotic outcomes especially since their interconnectedness is necessary for the system to function properly. For example, malicious devices may try to intercept transactions between other devices. Without human interference in such transactions, it may be difficult to detect when this has occurred.
A second challenge is that the release of 5G network may cause an overload, promoting scaling issues to arise. With qualities like faster speeds and shorter response gaps, it won’t be surprising if people immediately want to switch to the network and start trying out various IoT applications. Even with a blockchain in place, the issue of scalability is ever present.
The Impact of 5G and Blockchain Challenges
Both issues overpower the benefits of most technologies and render them nearly useless for IoT applications. If devices cannot collect data and carry out transactions securely, then the whole field of communication between devices cannot progress. If a doctor in Sweden can’t remotely perform surgery on a patient in France for fear that the network will cut off in-between procedures as a result of scalability issues, then that sub-field of medicine cannot progress either. Neither can those who write interactive university examinations or carry out complex manufacturing and design operations without being physically present.
Blockchain projects could solve the first challenge since security is one of the main features of a blockchain. The emphasis on using cryptographic techniques to ensure that data entered on a blockchain is tamper-proof and gets from sender to recipient without being hacked is a useful addition to the 5G network. It can be added as a foundation for regulating smart contract and IoT disputes.
IoT devices store their identities in cloud servers where their data is not secure. Decentralization shields their digital identity from any external parties and offers privacy in their transactions.
The issue of scalability is not as easy to solve. IoT devices will simply overwhelm the network with the thousand of on-chain transactions that will most likely occur every second. To solve this problem, there will need to be a significant improvement in the scalability of blockchain technology in the near future.
The lightning network has seen some recent progress in this area, and the latest Bitcoin Cash ABC fork has better scalability due to an improvement in block sizes. Ethereum's plasma network and its sharding update, as well as plans to migrate to Proof of Stake, are all steps toward solving the issue of scalability.
Another approach is IOTA's Directed Acyclic Graphs (DAGs) structure which if perfected, could carry the impending transactional load. However, with every progression toward scalability, security and decentralization reduce. No blockchain-based IoT network will function efficiently without solving these challenges first. The onus is on developers and manufacturers to collaborate on solving them since both groups as well as the global population stand to benefit a lot from the success of such a technology.
Looking at the benefits and challenges of combining 5G and blockchain technology for IoT applications, several questions come to mind: Is it worth it? Is it worth the cost of development? How certain is it that blockchain scalability will catch up to the growth rate of IoT devices?
From what is currently known about blockchains, they have underpinned various cryptocurrencies, each operating at different speeds, which means that blockchains can indeed be adjusted. This makes the possibility of creating a perfectly scalable system less-far-fetched.
Both 5G and blockchain technology promise benefits and solutions that will easily boost almost any system in the world, from payment processors to e-commerce and supply chain management. So as for the question of whether it is worth it, the answer is yes. It is absolutely worth the cost of development to create a scalable and secure backbone for IoT interconnectedness. This is crucial to the world’s evolution into a smart, connected system.