Decentralized storage has been in the center of attention since the appearance of File coin which raised over 250 million USD from prominent investors. But what is all that about?
What is Decentralized Storage?
Decentralization is defined as the transfer of the authority from a central entity to the participants in the system. Storage is defined as the retention of retrievable data on a computer or any similar kind of electronic system. We use the storage daily, from the smartphones and computers to storing files on the “cloud.”
Why Decentralized Storage?
The current solutions are all centralized. Restrictive nature of services such as Google Drive and Dropbox combined with an increasing number of reports about data leaks are making people look for alternatives.
In the last couple of years, we have had a number of high-profile data leaks. Some of the examples include:
- Equifax (Data costs of up to $400M)
- Facebook Cambridge Analytica (Up to 87M user data leaked)
- Chinese Resume Leak (202M of records leaked)
- Marriott Hotels (383M of records including credit card information was leaked)
The central server storage is the number one contributing factor to the data breaches, as there is no damage control. Once someone is in the system it can download all the records.
Decentralized storage is a potential solution which is already seeing implementations with the Blockchain protocols. It is a system which is being able to store your files without having to rely on centralized silos of data which often do not store the data in a secure manner and undermine the privacy of its users.
Back in the days when P2P file sharing was popular, torrenting and services such as Limewire were used for downloading of files. It was maintained as a system where people maintained copies of the file and seeded (sending a fraction of the file) to other participants in the network. However, there were no incentive mechanisms in place to keep the network participants online, which lead to the delay of file downloads.
Decentralized file storage works in a similar way but with key differences. There is an incentive mechanism in place to keep the network running smoothly, as well as advanced cryptography and encryption in place, helping users to keep their privacy.