We are all witness to how the “blockchain” is changing the world for good. For those who’ve come in late, “the blockchain” is the underlying technology behind cryptocurrencies like Bitcoin that has taken every industry by storm.
The main agenda of this technology is to decentralize many things as we know today. It started with decentralization of money with Bitcoin but it is now moving ahead and trying to decentralize other aspects of human life.
This also reminds me of Johnston’s Law that says,
Everything that can be decentralized, will be decentralized
And the same is happening! The blockchain technology is being used to scrutinize every nook and corner of various industries to reach a conclusion whether its application can make it better.
As a result of that, the “Decentralized Storage Networks” is emerging to challenge the status quo of giant cloud storage companies like DropBox, OneDrive, and Amazon.
Traditionally, for storing large amounts of data, we have relied on centralized services, some of which I mentioned above. But this way we need to give up the sovereignty of our data and have to be at the helm of such centralized companies who can use this data for any purpose they intend to.
Also with such services, we really don’t know how hack-proof their server system really is and whether or not they are copying our data and selling it elsewhere.
However, with the rise of decentralized cloud storage services powered by blockchain, the days of stress over data theft will be soon gone. Some of the companies trying to do so are listed below.
Top Decentralized Storage Network (DSN)
Sia is a decentralized peer-to-peer cloud storage solution that aims a reducing the cost of cloud storage as well as improving the security of your stored data.
When you choose to store data on Sia blockchain, Sia splits, encrypts and distributes your data to different nodes which can later be used to retrieve your data upon your request only because you hold the private keys of encryption.
Sia does this by creating a marketplace for hosts and users via the token economics of Siacoin. Anyone can rent out extra space on their PC to the Sia decentralized network and get paid in Siacoin. Similarly, any user who wants to use Sia storage needs to pay Siacoins to a host.
Siacoin currency is used to execute a file storage contracts on the Sia blockchain. A host has to keep the files for an agreed upon time and in an agreed upon space plus has to put some amount of Siacoins as collateral too. Collateral so that the host can be punished if he is not online when the data is requested by the user. Later, after the end of the agreement, payment will be released by the file contract to the host in Siacoin.
If the host loses the files, they won’t get paid plus their collateral is gone too. These file contracts on the Sia blockchain enforces a fair play from both the user and host sides.
Storj is another distributed storage network based on blockchain but its approach and implementation is different from its peers.
Also, you rent your extra space on your PC or hard drive to store other’s data and earn Storj tokens for the amount of space you have given for rent.
Storj is also making the largest, cheapest and most secure cloud service. Secure because your data is broken in pieces, encrypted and distributed across the network and can be accessed only on your request with your private keys.
But unlike Sia, Storj doesn’t create a free market space for lending your extra space because the prices are already fixed by the company.
Also, the existence of Storj tokens is somewhat questionable because I don’t see any real use case for them when you have alternative payment options for buying Storj services in BTC.
Frankly, I don’t see them as a major player because their payments for renting out space is also abysmally low and there is no mining of Storj tokens because it is an ERC20 token.
However, they are surely better than Amazon-like services if you see it only from the price angle but I still couldn’t figure out what happens when the host runs away or decides not to rent anymore. I see this as a problem because there is no mechanism like Sia here to punish or enforce the host to continue in the contract as they have no collaterals involved.
MaidSafe stands for Massive Array of Internet Disks – Secure Access For Everyone.
It is an ambitious project that has been under development for more than a decade now. It is the world’s first autonomous data network, a kind of new internet, you can say.
And because its only aim is not to distribute and decentralize data, it is more than a decentralized cloud service like Sia or Storj. Needless to say, Iit does have the element that can be used for much secure cloud storage.
Also remember, MaidSafe doesn’t use blockchain directly for decentralization and has a totally different consensus system.
The safe network has clients and farmers. Farmers take care of the data on the network through providing their resources like disk space, computing power, and uptime. And clients use the network like browsing, uploading data, using DApps etc.
Clients use Safecoin for uploading data on the network which broken, encrypted and distributed on the peer-to-peer network. And upon request, proof of resource consensus will be used to retrieve your data and also pay Safecoins to the farmer who found it first for you. See the below image for more understanding.
Note: MaidSafeCoin is a proxy token that was released during MaidSafe’s crowd sale and will be swapped for Safecoin on a 1:1 basis when Safecoin is released. MaidSafeCoin is a token that is listed on the bitcoin blockchain and can be purchased on a number of exchanges.
Filecoin is quite similar to Siacoin because they have their own blockchain where mining actually will happen.
At the same time, there are significant differences between them too for they have implemented different solutions to solve the same problem.
Filecoin also works based on creating a free marketplace for storage of data and rent of extra disk space if you have it. But it is built upon some very complex and new tech pieces that haven’t been thoroughly tested yet. I will not go deep in explaining all these tech pieces but will list them for your knowledge.
Note: Filecoin is still a futurist project which has not been launched yet. You can now apply on their website to become an early miner when its actual blockchain launches and can buy its futures on various exchanges.
But having said that, it naturally puts it behind the rest of the projects that you can use now to securely hold your data.
Conclusion: Best Decentralized Storage Network
After researching and writing on this topic, one thing is very clear – if you want to make a decentralized internet, you have to first solve the problem of storing data centrally. The project that will be able to solve this problem effectively will win in the long run. For a shorter run, all of these projects are a good alternative for storing sensitive data.
Decentralized storage is, without a doubt, the future of web’s new storage but it will not happen overnight and we should expect many roadblocks before we actually hit a huge mass adoption.
Having said that, there are other projects that are trying to do such a thing but not all are very appealing. I am also looking into the INXT project deeply to understand how they are solving the problem of centralized storage to build a new internet.
That all from my side in this article. It is time to hear from you: Which DSN i.e. Decentralized storage network you like? Are using any of these storage networks? How has been your experience so far?
I would love to hear from you in the comment section below.
Disclaimer: I am not invested in any of these coins as of now but that might change soon. Also, do not take this article as a piece of investment advice and always DYOR (Do your own research).
Here are a few other hand-picked writings for your further reading on CoinSutra:
- Best Books To Read On Blockchains And Cryptocurrencies
- 5 Best Decentralized Exchanges Which You Can Use To Trade Right Now
- CryptoKitties – Everything You Need To Know
- CIVIC Cryptocurrency: Everything You Need To Know
Harsh Agrawal is the Crypto exchange and bots expert for CoinSutra. He founded CoinSutra in 2016, and one of the industry’s most regarded professional blogger in the fin-tech space.
An award-winning blogger with a track record of 10+ years. He has a background in both finance and technology and holds professional qualifications in Information technology.
An international speaker and author who loves blockchain and crypto world.
After discovering about decentralized finance and with his background of Information technology, he made his mission to help others learn and get started with it via CoinSutra.
Join us via email and social channels to get the latest updates straight to your inbox.