On-chain data storage: where blockchain really shines

Blockchain / April 26, 2019 / Comments: 0

G’day, folks! Let’s learn some more about wonders enabled by blockchain technologies. As you know by now, blockchain adoption goes viral changing the way we think about routine stuff. Yep, decentralized technologies do make our life easier. To financial institutions and payment service providers, they offer solutions for direct, super-secure payments with no middlemen, risks, and extra charges. Also, using P2P ledgers, supply chains can get transparent and accountable. So guess what else, blockchain is vital to the future of data storage.

There we are: we’ve got close to the focus of this story – on-chain data storage. So get comfortable ’cause we start!

Traditional data storages: a little bit too centralized

Keeping important files and life memories on a local hard drive is bad taste, some may say. Indeed, missing an opportunity to “unload” a desktop or laptop doesn’t seem smart. With this in mind, millions of human beings trust their “priceless bytes” to cloud storages and local data centers.

As experts say, the data storage industry is getting bigger by the minute. By 2021, it will presumably grow to a humongous massive: 2 300 exabytes! In that regard, we may face serious issues pretty soon. The issues and concerns include new locations for service providers, more scalable hardware and software, new security-related challenges, increase in power consumption, and so on.

On top of that, traditional storage services are centralized. In other words, you give away your files to a team of specs sure they can keep them for years to come. Let’s see now, how random cloud storage works:

  1. As a user, you upload data on a cloud.
  2. The service provider puts the data in one of its data centers.
  3. Next, to access your files from your PC, laptop or mobile device, you need to send a request to the data center.
  4. The data center gives you access to the files.

You wish it could be that easy, folks!

There’s a mess of reasons that make traditional cloud storages “weak.” Get a load of these:

  • US residents may face storage performance and data delivery delays. The reason is, a great many US data centers are located somewhere abroad, where it’s naturally cold.
  • Technical solutions used to ensure cloud storage performance need to catch up with the volume of stored data. As a result, they need to be continuously upgraded/replaced, which means extra costs to service providers.
  • All files stored on the cloud are “open” for the service provider 24/7/365. That’s probably not the best news for users obsessed with data privacy.
  • A web browser poses a risk, as well. To access files stored on a virtual cloud, you need to use a web browser as a gateway. The gateway, in turn, is a sitting duck for hackers and makes cloud computing vulnerable. No seriously, a single attack from someone’s computer can affect the whole storage cloud!

Given the above, an idea about a healthy alternative to traditional storage services looks pretty inviting. Let’s see now how blockchain is vital to the future of data storage.

Blockchain is vital to the future of data storage

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Unlike “old-school” data centers, decentralized storages shard (fragment), encrypt, duplicate and distribute information between computers (nods) building a P2P network. Here’s how the whole thing works:

  1. You upload data on a P2P cloud.
  2. The data gets sharded, encrypted and distributed between nods.
  3. You get a private encryption key (hash) required to get access to your files.

Haven’t we missed something? The storage servers, of course! However, it doesn’t matter as the blockchain-based platform provides a full-on marketplace for network users willing to share free disc space for “sensible compensation.” In other words, users can rent extra space and get paid in local coins/tokens for that. As for the coins/tokens, their “job” is to execute file storage smart contracts on the P2P platform.

On-chain data storage: a long way to go

If you still wonder if blockchain is vital to the future of data storage, we give you 3 benefits on-chain data storage offers.

  • Cost saving

In theory, a blockchain-based data storage is way cheaper than bothering with all those bulky servers requiring regular maintenance and upgrades.

Instead, service providers compensate network users for free hard drive space they’re ready to rent.

  • Decentralized clouds are harder to hack

Before we go directly to the point, “harder to hack” doesn’t mean “invulnerable.” However, specific techniques such as sharding and encryption make it hard for attackers to steal or access crucial information.

But suppose a hacker gets access to a node keeping one of many data pieces, it changes nothing. He/she still needs to access and decrypt all the other parts to solve the puzzle.


  • Better data privacy enabled by automation

Now, with blockchain your digital data remains yours. Using smart contract technology, you can automate lots of processes and make them transparent. As a result, you can process critical information without go-betweens and the human error risk.

Also, blockchain relies on public ledgers holding every single record about transactions, and exchanges. That means, everyone is free to verify everything that’s happened.

Sure thing, blockchain technology, as it is today, is far from perfect. Still, blockchain is vital to the future of data storage as it stands for permanent, low-cost and censorship-free data. Well, we hope so!

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