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How data storage will shift to blockchain

News Analysis
Apr 24, 20194 mins
Data CenterEnterprise Storage

Move over cloud and traditional in-house enterprise data center storage, distributed storage based on blockchain may be arriving imminently.

Chains of binary data.
Credit: Cybrain / Getty Images

If you thought cloud storage was digging in its heels to become the go-to method for storing data, and at the same time grabbing share from own-server, in-house storage, you may be interested to hear that some think both are on the way out. Instead organizations will use blockchain-based storage.

Decentralized blockchain-based file storage will be more secure, will make it harder to lose data, and will be cheaper than anything seen before, say organizations actively promoting the slant on encrypted, distributed technology.

Storing transactional data in a blockchain

China company FileStorm, which describes itself in marketing materials as the first Interplanetary File Storage (IPFS) platform on blockchain, says the key to making it all work is to only store the transactional data in blockchain. The actual data files, such as large video files, are distributed in IPFS.

IPFS is a distributed, peer-to-peer file storage protocol. File parts come from multiple computers all at the same time, supposedly making the storage hardy. FileStorm adds blockchain on top of it for a form of transactional indexing.

“Blockchain is designed to store transactions forever, and the data can never be altered, thus a trustworthy system is created,” says Raymond Fu, founder of FileStorm and chief product officer of MOAC, the underlying blockchain system used, in a video on the FileStorm website.

“The blocks are used to store only small transactional data,” he says. You can’t store the large files on it. Those are distributed. Decentralized data storage platforms are needed for added decentralized blockchain, he says.

YottaChain, another blockchain storage start-up project is coming at the whole thing from a slightly different angle. It claims its non-IPFS system is more secure partly because it performs deduplication after encryption.

“Data is 10,000 times more secure than [traditional] centralized storage,” it says on its website. Deduplication eliminates duplicated or redundant data.

Disrupting data storage

“Blockchain will disrupt data storage,” says BlockApps separately. The blockchain backend platform provider says advantages to this new generation of storage include that decentralizing data provides more security and privacy. That’s due in part because it’s harder to hack than traditional centralized storage. That the files are spread piecemeal among nodes, conceivably all over the world, makes it impossible for even the participating node to view the contents of the complete file, it says.

Sharding, which is the term for the breaking apart and node-spreading of the actual data, is secured through keys. Markets can award token coins for mining, and coins can be spent to gain storage. Excess storage can even be sold. And cryptocurrencies have been started to “incentivize usage and to create a market for buying and selling decentralized storage,” BlockApps explains.

The final parts of this new storage mix are that lost files are minimized because data can be duplicated simply — the data sets, for example, can be stored multiple times for error correction — and costs are reduced due to efficiencies.

Square Tech (Shenzhen) Co., which makes blockchain file storage nodes, says in its marketing materials that it intends to build service centers globally to monitor its nodes in real time. Interestingly, another area the company has gotten involved in is the internet of things (IoT), and it says it wants “to unite the technical resources, capital, and human resources of the IoT industry and blockchain.” Perhaps we end up with a form of the internet of storage things?

“The entire cloud computing industry will be disrupted by blockchain technology in just a few short years,” says BlockApps. Dropbox and Amazon “may even become overpriced and obsolete if they do not find ways to integrate with the advances.”


Patrick Nelson was editor and publisher of the music industry trade publication Producer Report and has written for a number of technology blogs. Nelson wrote the cult-classic novel Sprawlism.

The opinions expressed in this blog are those of Patrick Nelson and do not necessarily represent those of IDG Communications, Inc., its parent, subsidiary or affiliated companies.