When we consider data storage solutions, there was a time when traditional in-house data centers moved over, and the cloud came into the picture as a pertinent solution. But things are getting upscaled day by day, and now it may be the turn of distributed storage, which will be based on Blockchain or Blockchain data storage solution.

Though Cloud servers can store everything and make users’ lives easier, however, there are cloud security issues in the place. For example, cloud vendors like Amazon and Google dominate the cloud storage industry; however, they are not beyond speculation that they sometimes give access to users’ private data. This is because user files are not encrypted in the storage, hence, often vulnerable to manipulation.

Similarly, although centralized data storage has its own benefits like availability, high speed, low latency, and quick throughput – all these come at a cost. Furthermore, in this case, if that single centralized server is hacked, millions of users’ data will be compromised.

In this context, the concept of a decentralized storage solution claims to be more private and secure since they do not store data on a centralized server. Instead, in this case, the files are divided into multiple parts and sent to different nodes or servers, which imminently reduce the external control on potential user data.

Although this is a significant improvement, a decentralized storage solution also comes with some constraints. Blockchain data storage comes as an obvious solution to this decentralized storage concept. But does that mean Blockchain storage will solve all the problems of decentralized storage solution? Let’s explore.

Related post – What are Cloud security challenges and How can we address them?

How distributed cloud storage with Blockchain technology can store data

Data is stored on remote servers in cloud storage systems, which we can access through the internet. Cloud service providers maintain these servers. Two concepts work here

– traditional cloud servers – it stores user data in one particular centralized server.

– decentralized cloud storage – it does not store user data on one centralized server. Instead, different nodes are used for this purpose, which is located across the world. Additionally, these nodes are independent of each other. A single entity hosts neither these nodes nor are they controlled by cloud vendors. Anyone can run a node. 

Decentralized data storage uses different protocols at different times. Here are some of them mentioned below:

BitTorrent:  You must be well known about BitTorrent, which followed peer-to-peer file sharing. Users widely use it to download various music, video, and text files to local storage. These downloaded files on BitTorrent are divided into pieces and fragments; however, they are not encrypted. You can download them using different seeders. The concept is very similar to a decentralized cloud.

The InterPlanetary File System (IPFS):  This is the foundation for many of the currently developing distributed blockchain storage solutions. Filecoin is one of them. It appeared in 2015. IPFS is a hypermedia protocol for transferring data between servers and users on the internet for web design. Instead, on a central server, this works on multiple nodes.

When you upload a file to the IPFS network, it divides the file into fragments, which are called blocks. Additionally, each of the fragment receives its individual hash. You can find and retrieve the blocks by their hash. This could be content-based addressing also.

However, the BitTorrent and IPFS protocols have some challenges, and they are both not a perfect distributed storage concept. But of course, they were the appealing solution when we consider distributed data storage. Hence, as Blockchain technology came into the picture, it popped up using it to improve data storage solutions.

Blockchain data storage is based on decentralized cloud solutions that aim for improved security, better user control, and privacy over data. This is because of one of the distinguishable features of Blockchain – encryption. So, if a file is uploaded to the network, it automatically gets encrypted. However, you can access that file with an encryption key; and most importantly, no one can access the file without this. 

The common things between the blockchain data storage solutions and BitTorrent or IPFS are sharding, which is a technique of breaking a single file into multiple pieces stored on different nodes. In this technique, no single node holds the entire file; instead, they keep a fragmented file. Moreover, there are duplicate fragments, which lead to redundancy in data. So, you can find the same fragments on multiple nodes.

How to store data in Blockchain data storage solution

There are two blockchain data storage solutions approaches:

– off-chain

– on-chain.

On-chain process: In the on-chain process, all users’ data is stored within each block. The great benefit of this principle is in the event of an attack; there is no chance of data loss. Furthermore, data can be resynchronized and restored. This security aspect comes by maintaining full nodes where every node needs to contain all uploaded data. No doubt, this is an expensive option. The other reason behind this is the Blockchain’s scalability issue, which is not capable of storing entire files of the users’.

Hence, in this mechanism, any running node needs to keep a copy of all the data uploaded to the network. At the same time, all nodes must constantly synchronize with one another. Not to mention, if each user uploads even a few megabytes of data, it easily turns the network overloaded along with increased network fees. This is often called blockchain bloating. And there comes the off-chain approach.

Off-chain process: As the on-chain process has some drawbacks, as mentioned above, almost all Blockchain data storage solutions use off-chain. This approach directly tries to answer the scalability issue of Blockchain. So, how does that happen? Well, in this principle, users’ data is not stored in the Blockchain; instead, it stores metadata on-chain while using blockchain to facilitate the ecosystem of the platform.

No doubt, security is a concern in this approach. So, in case of a system attack, theoretically, metadata is the only thing that will be left, and the data itself will be completely lost. However, off-chain solutions are cost-effective and can handle different use cases.

The off-chain Blockchain storage solution uses miners to provide their hard disks for storing other users’ files, whereas the blockchain facilitates this storage market between users and miners. In this way, it tries to resolve the scalability problem. However, convincing users to store someone else’s data on their disks and running nodes could be challenging. Often platform native crypto coins are utilized for the renting purpose as an incentive.

Benefits of Blockchain Data storage solution

Blockchain data storage has several compelling benefits when you compare it to traditional centralized cloud servers.

Security. This is an inherent feature of Blockchain. As in the Blockchain network, files are encrypted with private keys, so it is impossible to tamper with it. Hence, Blockchain-based decentralized cloud storage retains and transmits the data more safely. Additionally, since files are divided into pieces and stored on multiple nodes so there is no chance of a single point of failure. On the contrary, if a centralized server crashes, you’ll probably not able to access your data. So, in case of a certain node failure, your files remain safe.

Immutability. There is no concept of a central authority in a Blockchain network that restricts access to the file. As a result, no one can tamper with any file. Additionally, the file’s hash is stored in the ledger.

Lower price. The data storage solution from centralized cloud storage vendors comes with a good amount of cost, which is much lower in the case of a Blockchain storage solution.

Incentives for storing. Blockchain storage is used for many decentralized cloud projects which use the native cryptocurrencies as an incentive to the users who rent their spare storages like unused disks, hard drives, or data centers. This creates a win-win situation where Blockchain storage platforms connect users’ willingness to share their storage space with the users who need it.

What are the Blockchain data storage problems?

– As explained above, the on-chain solution is expensive and has a scalability issue. On the other hand, though, the off-chain solutions solve that issue to a certain extent, however, not storing content itself.

– Scalability issue as discussed in the previous section.

– Blockchains have processing limitations if you compare it to traditional payment systems.

– In peak times, the Blockchain mechanism often creates network overloads, which delays transactions and increases transaction fees. This can become a significant drawback when there is a growing number of transactions and users.

– Blockchain data storage solution is expensive. This is because of the amount of data we store that has to be stored by every full node elsewhere. Hence, whoever downloads the blockchain is also downloading your piece of data. So, when we store data on the blockchain, we need to pay a base price for the transaction itself and an amount per byte that we want to store. In the case of smart contracts, we need to pay for its execution time.

Do we have any solution for Blockchain data storage problems?

Today, different Blockchain data storage solutions are trying to address the Blockchain scalability issue. One of these is ILCoin and their RIFT protocol that claims to solve scalability issues and facilitate on-chain based data storage. The ILCoin developers claim that its block size could be up to 5 GB accumulating the mini-blocks. According to this developer team, their RIFT protocol potentially makes the size of the network unlimited.  

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Final verdict

Both traditional cloud data storage solutions and decentralized Blockchain data storage have their own pros and cons. Cloud security is a pertinent problem in traditional cloud servers though they have higher speed and availability.

On the contrary, Blockchain data storage, which is decentralized storage, improves users’ privacy and security through encryption. However, Blockchain storage solutions cannot come with similar high speeds and low latency and scalability. Finally, we can say each type of data storage solution has its own benefits and drawbacks, and only time will tell us who will succeed in the game.