The convergence of blockchain, IoT, and AI is redefining the landscape of digital transformation.
The technologies are no longer operating in isolation but are intertwining to create a robust foundation for a new digital infrastructure. At the forefront of this transformation are innovations in trust, automation, and connectivity, enabling industries to explore previously uncharted opportunities.
David Palmer, chief product officer of Pairpoint by Vodafone—an IoT and Web3 platform at Vodafone—provides insights into how the technologies are shaping the future. “Blockchain is providing trust. It gave us tokenisation, it gave us smart contracts, and it gave us a new way of automating,” Palmer said, emphasising blockchain’s foundational role in enabling secure transactions.
Blockchain as a trust layer
Blockchain has emerged as a critical enabler of trust in the digital economy. Its applications have progressed from theoretical proofs of concept to practical tools that enhance efficiency and transparency. Blockchain introduces automation through tokenisation and smart contracts, which has begun to spill throughout the broader business ecosystem. It also supports decentralised finance (DeFi), which enables new approaches to asset management and open banking.
One noteworthy innovation is the rise of decentralised autonomous organisations (DAOs), which are based on smart contracts. These organisations have proven the ability to change how entities are managed by automating decision-making processes and enabling equitable participation.
The role of IoT in data generation
IoT devices are quickly becoming ubiquitous, embedded in everything from cars and drones, to cabinets and sensors. By 2030, the number of IoT devices is expected to reach 30 billion, with estimates indicating that the number may rise further as IoT becomes more integrated into business processes. The devices have the ability to generate massive amounts of data, providing the foundation for AI systems to deliver intelligent insights.
“By 2030, we’re expecting over 30 billion IoT devices—these are cars, drones, cabinets, sensors—all woven into the business process and industry,” said Palmer. “As AI demands more data, you’ll see more connected devices and an acceleration of that figure.”
IoT also introduces the idea of an ‘economy of things,’ in which devices transact autonomously. For this ecosystem to function properly, devices must be connected and equipped with trust mechanisms, which blockchain is particularly designed to address.
AI’s demand for secure and reliable data
AI systems, especially large language models, require massive amounts of high-quality data to function effectively. As public data sources become saturated, businesses are focusing on proprietary data. IoT devices are set to play an important part in this transition, producing the data required to drive AI advancements.
A two-way relationship is emerging between IoT and AI. IoT devices provide data for AI models, while AI enhances the functionality of devices by delivering real-time intelligence. Ensuring the security and authenticity of this data exchange is paramount. Blockchain’s ability to provide verified digital identities and cryptographic signing mechanisms addresses these concerns, fostering trust in both data sources and AI outputs.
Digital wallets: A bridge between technology and adoption
Digital wallets play a role in the evolution of digital infrastructure. Globally, their numbers are predicted to grow from 4 billion today to 5.6 billion by 2030. Blockchain-enabled wallets go beyond use in cryptocurrencies, supporting account abstraction and integration with tools like WalletConnect. These advancements make blockchain more accessible for enterprises and consumers.
One key development is the integration of tokenised bank deposits, which bridges traditional banking and blockchain-based systems. This innovation paves the way for enterprises to adopt blockchain in their transaction processes, accelerating its adoption in broader business ecosystems.
Embedded finance and IoT
The integration of finance into IoT devices is another step forward. Smart contracts and AI enable autonomous transactions by devices such as cars, drones, and sensors, easing processes such as toll payments, EV charging, and retail purchases. This embedded finance ecosystem has the potential to improve efficiency and reduce friction in user journeys.
For example, the in-car payment business is predicted to reach $530 billion by 2030. Vehicles equipped with blockchain-linked SIM cards can handle a wide range of transactions securely and autonomously. “By linking EV chargers and vehicles to blockchain, we can enable peer-to-peer transactions,” Palmer said, adding that blockchain and IoT are also creating new possibilities for autonomous energy management and sustainability.
This same principle extends to energy systems, where vehicles connected to smart grids can sell energy during peak times or charge during off-peak hours. Such innovations support sustainability efforts and optimise resource utilisation.
Blockchain and CBDCs
Central Bank Digital Currencies (CBDCs) are gaining popularity as governments look for ways to influence the token economy. CBDCs enable the implementation of macroeconomic policies, such as controlling the money supply or redistributing income, within the blockchain ecosystem. Tokenised deposits, which enable banks to digitise traditional monetary systems by leveraging blockchain capabilities, complement this.
The combination of governmental and institutional involvement underscores blockchain’s growing maturity and adoption. Additionally, DeFi tools and real-world asset tokenisation are further expanding blockchain’s applicability in enterprise and consumer markets.
The evolution of the metaverse
The metaverse, once considered a futuristic concept, is evolving rapidly. AI-enabled smart glasses are changing user interactions with immersive content. Palmer said, “By 2030, AR glasses are expected to complement, rather than replace, smartphones.”
AI robots add physicality to virtual interactions, transforming industries such as manufacturing and healthcare. These advancements present significant opportunities for innovation across sectors, he said.
A converging digital ecosystem
The intersection of blockchain, IoT, and AI represents a paradigm shift. Blockchain acts as the trust layer, IoT provides the data, and AI delivers intelligence. Together, they form a new digital operating system that has the potential to transform industries and economies. By 2030, the interconnected ecosystem of the three will power automation and innovation.
“The key to integration is connectivity,” Palmer concluded. “If we can link billions of devices to blockchain and AI through secure infrastructure, we unlock the potential for a truly interconnected digital economy.”
(Photo by Unsplash)
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