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This paper represents new functional architecture for the Internet of Things systems that use an avatar concept in displaying interaction between components of the architecture. Object-oriented representation of “thing” in the avatar concept allows simplify building and deployment of IoT systems over the web network and bind “things” to such application protocols as HTTP, CoAP, and WebSockets mechanism. The assets and stakeholders for ensuring security in IoT were specified. These assets are needed to isolate the risks associated with each of assets of IoT system. Example of Thing Instance’s description and its functionality using JSON format is shown also in the paper.