Thing-to-thing electricity micro payments using blockchain technology

Abstract

Abstract-Thing-to-thing payments are a key enabler in the Internet of Things (IoT) era, to ubiquitously allow for devices to pay each other for services without any human interaction. Traditional credit card-based systems are not able to handle this new paradigm, however blockchain technology is a promising payment candidate in this context. The prominent example of blockchain technology is Bitcoin, with its decentralized structure and ease of account creation. This paper presents a proof-ofconcept implementation of a smart cable that connects to a smart socket and without human interaction pays for electricity. We identify several obstacles for the widespread use of bitcoins in thing-to-thing payments. A critical problem is the high transaction fees in the Bitcoin network when doing micro transactions. To reduce this impact, we present a single-fee micro-payment protocol that aggregates multiple smaller payments incrementally into one larger transaction needing only one transaction fee. The proof-of concept shows that trustless, autonomous, and ubiquitous thing-to-thing micro-payments is no longer a future technology.

Blockchain for Cities—A Systematic Literature Review

“…The use cases often rely on the PKI public key based identities to provide pseudo-anonymity protection of the transaction parties, including identities of voters in e-voting [70], value-added-tax payers [73], event ticket holders [101], parties in the medical record sharing platform [109], [110], e-commerce customers [135], machine-to-machine electricity transactions parties [140], product ownership registration parties [137], peer-to-peer energy trading parties [186], [195], [206].…”

“…The use cases include those that require limited business logic but place security as the foremost consideration, such as in e-voting [70], timestamping of research manuscripts [91], preservation of government documentation [61]. Other cases emphasize payment as the key proposition, such as electricity trading in micro grids [185], machine-to-machine micropayment [140], and electric vehicle charging payment [202].…”

“…Payment is another popular token utility at the application level. Reference [140] is a system that enables Bitcoin-based micro-payment for a smart cable connected with a smart socket to pay for electricity. Reference [202] describes a system for Bitcoin payment between electric vehicles and the grid, leveraging the lightening network [254] scalability solution for Bitcoin blockchain.…”

A Model for Deriving Trust and Reputation on Blockchain-Based e-Payment System

“…There are several pieces of prior work that suggest the application of blockchain technology to e-commerce payment systems [14,15] or propose models for deriving reputation scores of the system users [18,19]. For example in 2015, Carboni presented a decentralized and distributed feedback management system built on top of the Bitcoin blockchain without changing the existing Bitcoin protocol [18].…”

“…Thus the data stored in blocks eventually become invulnerable to potential attacks that might try to manipulate them. Due to these unique characteristics, and also in line with Bitcoin's recent success, there has been growing interest in applying blockchain technology to various domains, such as digital rights management [2][3][4], health care [5][6][7][8], Internet of things [9][10][11][12][13] and e-commerce [14,15]. In particular, applying blockchain's immutability to online payment systems can make it difficult for malicious entities to manipulate transaction history such as the amounts or ratings, which will result in better reliability, security, and trustworthiness of the systems.…”