IBM has revealed its new solution which combines blockchain technology with Internet of Things (IoT) networks in a bid to better manage smart contracts.

Smart contracts allow the performance of credible transactions without third parties which are trackable and irreversible.

The firm has developed a method to deploy and create smart contracts to improve transactional regulations and constructed conditions.

The firm’s method is a distributed database of records which will be tapped into growing IoT and blockchain ecosystems.

IBM wrote in a blog post: “In a blockchain configuration, a large amount of information is related to financial transactions. As the popularity of the blockchain configuration continues to increase so does the desire to implement additional functions on the blockchain.

“For example, when determining information on the blockchain for smart contracts, the values used to calculate the information may be derived based on a particular random set of values. However, it may be optimal to use values which are based on other known sources of information.”

IBM hopes that the solution will fix the computational limitations of blockchain IoT networks and provide equal chances of successful completion of proof-of-work to all IoT devices in the network.

It also believes this incentive could eventually be used in “peer to peer (P2P) energy networks, logistic networks, crowd-sourced weather networks, and the like”.

Written by Leah Alger