IoT devices are a security nightmare: They should be easy to use / set up but hard to hack.
With classic devices, the solution is “cable”. If there is no cable between two devices, they can’t talk to each other. If you follow the cable, you can see who talks to whom.
Translating this solution for the wireless devices is “virtual cables”. Each device needs a wireless (NFC) connection area where the user can press a “virtual cable drum” (VCD). The device then passes a token to the VCD. Next, the user presses the VCD to the other device.
That creates a virtual wire between the two devices. The VCD is just a small NFC knob which can keep an encrypted token for a couple of minutes. Not having batteries and permanent storage will be a plus: No one can steal the tokens after the connections have been made.
In a similar fashion, the VCD could be used to install security updates: Put the token for the update or the whole patch on the VCD, press the VCD against the device to update to trigger the update.