Humans have progressed far beyond storing data on physical devices. Decentralized cloud storage (DCS), a mechanism for storing information in remote places, is the preferred choice for hosting files, websites, and apps in modern computing.

Individuals and businesses have benefited from decentralized cloud storage (DCS) since it eliminates the need to manage storage infrastructure. Its centralized data administration, however, creates additional concerns for consumers, such as censorship, privacy infringement, data theft, and poor information integrity.

Some have turned to blockchain technology to solve the challenges associated with centralized data storage. Blockchain-based storage, often known as “decentralized storage,” offers an efficient, resilient, scalable, secure, and cost-effective method of storing data.

This article provides an overview of decentralized storage networks. We’ll look at how the decentralized storage model works, its benefits, and the most prevalent blockchain storage providers.

What is the process of decentralized storage?

The decentralized storage concept distributes the duty for storing information across several members in a peer-to-peer network. This differs from centralized storage, where data is kept on a single server.

Decentralized storage preserves information accessibility and security by storing information redundantly across numerous nodes (computers). If a node cannot offer the requested content, the same data can be accessed from other storage nodes.

Many decentralized storage systems are designed after decentralized blockchains, allowing users to transact anonymously, anonymously, and safely. These platforms employ crypto-economic incentives to guarantee that everyone positively contributes to the ecosystem.

The decentralized storage approach is based on the assumption that not everyone would use the storage on their devices. As a result, individuals are encouraged to rent out unused hard drive space to users in exchange for payment.

Decentralized storage markets often leverage smart contracts provided by blockchain to ease interactions between consumers and storage providers. These smart contracts frequently describe one or more of the following:

The amount of data that the user wishes to store
The period for which the storage provider is required to keep the data.
The payment is made to a storage provider in return for their services.

Decentralized storage solutions, like blockchains, operate on a distributed architecture. As a result, they require a consensus process to keep the system running and to punish/incentivize certain acts.

To that purpose, most decentralized storage systems employ some form of the proof-of-storage (PoStorage) consensus mechanism. Proof-of-storage, which is popular in Filecoin, picks miners based on how much data storage they offer to the network. The process also employs a random verification scheme to ensure that miners truly hold the promised data.

The storage of data on a decentralized cloud storage (DCS) platform differs from that of a standard cloud storage provider such as Google Drive, Amazon Web Services (AWS), or Dropbox:

Initially, uploaded data are encrypted with cryptographic hashing algorithms before being divided into various bits (sharding). The fragments are then redundantly stored on separate storage nodes that populate the network. To get the file, users will use the content hash to request it and then reassemble the returned pieces to restore the original information.

What are the benefits of using decentralized storage?

Six benefits of decentralized cloud storage (DCS) are as follows:

Security

Individuals, businesses, and developers of decentralized apps must all address information security (dApps). Centralized storage solutions are unlikely to give strong security assurances. Using regular cloud storage, on the other hand, exposes user data to security threats.

Traditional cloud storage providers mostly store data in a few data centers worldwide. Those same data havens, however, serve as honeypots for hostile actors looking to steal stored data. It is also simple to prohibit users from obtaining information by flooding servers with DoS attacks or gaining administrative access.

Decentralized storage uses blockchain technology’s security assurances and provides safer storage choices. Multiple nodes in the network hold copies of information, removing single points of failure. Furthermore, due to the decentralized nature of DCS networks, stealing user data or blocking access is theoretically impossible.

This has numerous consequences for users:

Individuals may be sure that their data is secure and protected from illegal access. Companies will spend less time worrying about their customer’s data security and more time preventing hostile assaults and costly data breaches. DApp developers may design apps and webpages that are strong, secure, and censorship-resistant.

Efficiency

While decentralized cloud storage (DCS)has advantages, efficiency is not one of them. These platforms continue to rely on a small number of data farms worldwide to offer content to people worldwide. As a result, the storage paradigm could be more efficient, making information retrieval undesirable.

Because of their distance from data centers, users in remote places may have to use more bandwidth to download information. This not only increases connection prices but also reduces download speeds.

Service failures are common in centralized storage systems due to the client-server design. This can occur if too many people attempt to access the same server at the same time or if the actual hardware fails. The 2021 Facebook catastrophe, the 2020 GitHub outage, and the 2020 Microsoft outage are all examples of the inefficiencies of centralized data management.

The usage of peer-to-peer networks for file sharing distinguishes decentralized storage. Every node has the ability to store, request, and transmit data to other users. As a result, the loss of a single node (i.e., a “mini-server”) does not affect the overall system. This ensures that information is constantly available and uninterrupted.

Decentralized storage solutions can lower bandwidth utilization for consumers due to the worldwide spread of storage nodes. DCS users can connect to nearby nodes to share files instead of making information requests to faraway servers.

The end result? Increased file retrieval speeds and lower bandwidth costs.

Less expensive data storage

Another area for improvement with typical cloud storage is the high cost of utilization. Storage services are frequently given at fixed prices, forcing developers to pay for unneeded storage space. An acute shortage of options and significant vendor lock-in exacerbate the situation.

Decentralized storage solves the problem by becoming pay-as-you-go. Users may choose how much they pay storage nodes for file storage, possibly lowering the cost of storage for developers.

Furthermore, DCS providers are incentivizing individuals to rent out underused storage space. Because storage providers do not bear the burden of hosting specialized data centers, users of decentralized applications (dApps) can pay reduced rates.

Trustlessness

When you use a decentralized cloud storage (DCS) option, you are putting your confidence in the firm to keep your data safe and accessible. However, as a Web3 developer, you know the risks of relying on centralized intermediates.

Files on a server might unexpectedly vanish, websites can be restricted, and rogue governments can shut down programs. Blockchain technology eliminates the need for trust, necessitating decentralized storage for developers.

Many DCS platforms include tools like smart contracts to ensure storage providers and consumers follow through on commitments. Filecoin, for example, employs proof-of-replication (PoRep) and proof-of-spacetime (PoSpacetime) protocols to ensure that nodes are holding agreed-upon copies of stored files.

You don’t have to rely on anyone to keep your data, programs, or websites accessible when you use decentralized storage for developers. Your data is always available to be provided on-demand as long as the platform is operational.

Privacy

“Privacy” and “centralized cloud storage” are two terms that rarely go together. As previously stated, centralized servers are typically the subject of coordinated intrusions, resulting in the loss and theft of important data. However, the issue extends beyond servers and boils down to a need for more privacy-protecting measures.

To prevent unwanted access to information, most decentralized storage services employ encryption. Furthermore, they all employ a sharding method to divide files into numerous fragments, each of which is kept by a different node.

This provides various privacy benefits. To begin, only the proprietor of the cryptographic keys, i.e., you, may decode the files. Second, every peer needs full access to the file. However, you can retrieve the numerous file shards and reassemble the file.

Privacy is a major concern for Web3 users. The least any decentralized application developer should do is convince users that their information is secure and out of the hands of prying eyes. As a result, decentralized cloud storage (DCS) is an essential component of the Web3 development stack. Building a dApp on a centralized storage infrastructure completely violates the goal of decentralization.

Information integrity

More information integrity is needed when working with a centralized storage provider. According to Digital Guardian, data integrity is “the quality and consistency (validity) of data throughout its existence.” It continues, “After all, compromised data is of limited utility to organizations, much alone the threats presented by sensitive data loss.”

Because storage has a ‘location-centric’ approach, centralized data management cannot ensure data integrity. A URL, or Universal Resource Locator, pointing to the file’s location, is required to locate it.

If you’re developing in Web3, you’ll want to ensure that data, such as NFT metadata, preserves its integrity in perpetuity. Because they use a ‘content-centric’ approach to information storage and retrieval, decentralized storage can make this feasible.

A content-centric approach means that DCS systems handle resources based on their content rather than their location. Each file is processed by a hashing method, and the resulting hash (a lengthy string of alphabets and numbers) serves as the file’s unique ‘fingerprint’ or Content Identifier (CID).

CIDs can be used to discover information instead of untrustworthy URLs. With a CID, you may request a specific file from network peers—and it encourages correctness since the CID can be cross-checked against the hash of the file you got.

More crucially, for Web3 users, this strategy can remove issues such as missing NFTs. By using well-designed incentive systems, DCS providers can ensure your data remain intact for as long as possible.

What are the most well-known decentralized storage networks?

InterPlanetary File System (IPFS)

The InterPlanetary File System (IPFS) is a peer-to-peer file-sharing protocol that seeks to address the Internet’s shaky data storage architecture. To ensure the integrity and availability of information, IPFS employs ‘content-addressing,’ which addresses information by content rather than location. It also employs encryption to protect the privacy of its users.

Because nodes on the IPFS network might choose to store only files of relevance to them, access to your data is not assured. However, you may utilize a ‘pinning’ service that rewards IPFS nodes for keeping your data online—Pinata, NFT.storage, and Crust are all viable solutions.

Filecoin

Filecoin is a cryptocurrency dedicated to decentralized data management that was created by the team behind IPFS (Protocol Labs). Consider Filecoin to be an incentive layer based on the IPFS technology.

Filecoin allows you to pay nodes using the network’s token (FIL) to keep your files saved for a set length of time. If the time period expires, you must renew the payment. Filecoin audits nodes using random-check processes like proof-of-replication, giving consumers confidence that their data is still available.

Arweave

Arweave is an ambitious project that aims to create a “global hard drive” that users may use to store apps, websites, and other useful data eternally. Users pay storage providers for space using AR tokens and may get information whenever possible.

Arweave is a good decentralized storage option for people, developers, and businesses. Arweave provides a safe information storage system since it features a specialized blockchain with built-in incentives and a consensus mechanism (proof-of-access).

Storj

Storj, a decentralized storage marketplace, links users with excess bandwidth and storage capacity with those in need of low-cost, secure file storage. STORJ, an ERC-20 token, is used in transactions between Storj users and storage providers.

Storj is aimed at developers, businesses, and other entities that require specialized storage solutions. Select the optimum storage package for your needs, saving money on decentralized cloud storage (DCS).

Sia

Like other DCS providers, Sia compensates individuals for renting out idle, hard drive space to consumers. Those that offer storage services on Sia’s marketplace receive Siacoin (SIA), the platform’s utility token.

The Sia network is extremely decentralized and resistant to outages or efforts at censorship. This enables users to save their information while maintaining control over their data safely.

Conclusion

The demand for decentralized storage networks will increase as data privacy, integrity, and security requirements grow. Decentralized cloud storage (DCS) providers have the potential to bring in a new era of information storage that is efficient, inexpensive, dependable, and secure.

DCS services lower expenses passed on to end users by offering customizable price options to developers and businesses. Because such systems are permissionless, anybody may become a storage provider, supporting the concept of a decentralized web.