The clamor for more security has been heard loud and clear in the cryptocurrency industry, where there is a greater need for safe transactions. The theft of roughly $1.1 billion in bitcoin in the first half of 2018 alone demonstrates the vulnerability of such online transactions. The figure is important primarily because of the bitcoin boom, which is where decentralized cloud storage comes in as a saving grace for the $754.05 million market.
Cloud computing and blockchain industries may have one thing in common: both are rapidly growing and have the potential to revolutionize their respective fields. Notwithstanding, pioneers in the two industries have yet to discover a common interest. That may change soon, as projects have begun to embrace the idea of integrating blockchain into the cloud computing sector, and we may soon see a future of limitless possibilities.
The cloud computing industry is worth $180 billion, a figure that has been steadily rising for several years. While it may appear that the market has its fair share of dominant players, such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud Platform, and IBM Cloud, there is still room for growth.There is still room for newcomers to take a piece of the pie by offering something unique that distinguishes them from the competition.
This is where cryptocurrency and blockchain technology come into play. As previously stated, both of these industries are on an upward trend with no end in sight. This year, the cryptocurrency sector is expected to reach $1 trillion in market capitalization, and many large corporations are investigating what blockchain technology has to offer. Upon first glimpse, it may appear that there is no link between the two industries. Both blockchain startups and cloud computing companies, on the other hand, operate online and rely heavily on data.
Cryptocurrency and blockchain technology go hand in hand and are both on their way to become key components of our daily life. As cryptocurrencies become more prevalent in our daily lives, there will be a greater need for more scalable and efficient storage solutions than we now have. There will be a bigger rise in data creation.There will be an increased need for storage systems that can meet this requirement. Because of the widespread use of digital assets, more individuals are prepared to spend their money in crypto tokens and coins, resulting in a corresponding growth in the volume of data stored on crypto networks, which would be difficult to balance under today’s infrastructure.
Decentralized Cloud Storage for Cryptocurrency
Blockchain technology is the most secure and transparent way of storing data. But there are some drawbacks to using Blockchain-based cryptocurrency storage. The first issue is that storage on Blockchain is extremely expensive. Each transaction has to be verified by a third party which increases the cost but since Blockchain networks use a Proof-of-Work algorithm it also drastically reduces the speed of transactions. This makes blockchain unsuitable for storing large amounts of data and in turn, hinders its use as a cloud storage platform.
Another drawback is that all information stored on Blockchain is public and can be viewed by anyone with access to the network. So while this type of storage may be useful for private business dealings, it is not suitable for storing sensitive information such as financial records or personal data. What if we could have all the benefits of Blockchain with none of its drawbacks? That’s where decentralized cloud storage comes in! It offers users an alternative to traditional cloud services by providing them with their own private servers on a peer-to-peer network instead of using centralized servers owned by corporations like Google or Amazon Web Services (AWS).
As there are no middlemen involved, this means lower costs for customers and higher profits for providers since there is no unnecessary costs. The decentralized cloud storage space is a very interesting one as it offers a solution to problems surrounding data privacy and security. There’s been much debate on how decentralization can solve many issues that affect the blockchain and cryptocurrency markets, particularly how third party companies will be affected by such a move in contrast to how they are presently being used by conventional data centers.
It would seem that through decentralization, we can temporarily have our cake and eat it too as we resolve this issue.
Centralized cloud storage services are provided by third parties who have full control over your data and your privacy such as Amazon, Microsoft and Google Cloud Storage. These organizations can access your personal data and share it with others without your knowledge or consent, as well as loose your data through human error or technical failure.
In these cases, a single entity has all the control over an individual’s data. Decentralized cloud storage solves this issue by distributing data across multiple nodes on a network making it more secure and private.Crypto networks use a distributed ledger system that stores data on every single node connected to the network, making it extremely difficult to breach but also very expensive because it requires massive amounts of computing power.
Decentralized cloud storage has been around for a couple of years now and offers many advantages over centralized data storage methods that are currently used. Centralized data storage means a single data center or a group of them storing all your data, making it vulnerable to theft and attacks. Decentralized cloud storage solves this problem by using blockchain technology to break up files into little bits and save these on different nodes across the network instead of a single location. This makes it extremely difficult for hackers to steal data because they would need access to each node storing data across the network.
Here’s How Decentralized Cloud Storage Works:
- A user pays a provider to store their data.
- The provider then encrypts the data and splits it into blocks.
- These blocks are then stored across multiple computers on a blockchain network.
- The pieces are subsequently retrieved when needed for use, allowing for storage access across multiple locations.
Data is encrypted and then broken down into small pieces that are known as shards and distributed among various computers on a network called “nodes”. The file can only be reconstructed by bringing together all its parts, which are stored. First, you install a client application that connects your computer to the network. Then you store files on the network and pay for it in cryptocurrency.
The clients are run by people just like you. Your computer becomes a node on the network, sharing its storage space and bandwidth with other network participants. In return, you get paid in cryptocurrency (usually some variant of Bitcoin). In a recent video interview with Cointelegraph, Ethereum founder Vitalik Buterin presented an intriguing proposal aimed at combating the centralization of cloud storage systems like Amazon S3, Dropbox, and Google Drive.
Buterin went on to say that he feels decentralized cloud storage would be a “huge thing” for Bitcoin. He then went on to describe how decentralized cloud storage works: “Essentially, you take a file, divide it into pieces, store the fragments on a variety of computers, and then use smart contracts to ensure that those systems continue to hold your file in return for bitcoin.” They don’t get paid if they don’t keep your file.”
This approach is not just less expensive than standard cloud storage alternatives such as Amazon S3 or Google Drive. It also provides increased robustness in the case of a network assault. If one of the nodes containing your data is hacked or goes offline, the remaining nodes will be able to rebuild your file and distribute it in its entirety without any problems. This helps you to avoid the single point of failure issue that is common with centralized cloud storage systems.”
For example, if Joe delivers 1 bitcoin or litecoin to Neha, he initiates a transaction that distributes the money to all computers or ‘nodes’ that are part of the blockchain. Joe will not have to worry about the chain of events or the decentralized transaction because his bitcoin wallet will already contain a list of other nodes. Each node gets the transaction and learns that Joe will receive one unit of bitcoin. The whole network is aware of every transaction that has occurred. Decentralized cloud storage data may also be spread across a large network of nodes in the same way. Blockchain storage marketplaces, in my opinion, will eventually replace Amazon, Microsoft, Google, and others’ existing cloud storage infrastructure. We’re on our way to a decentralized web. There’s a lot to be excited about!