Data is booming, thanks to technologies ranging from IoT through to blockchain applications. Decentralised storage offers an excellent opportunity to manage the immense amounts of enterprise data collected by companies around the world. But why it’s worth combining decentralised storage with blockchain and what benefits can blockchain data storage offer? Let’s take a look.
Enterprises have moved away from centralised, local data storage to instead make use of cloud providers for storage. Most cloud solutions still involve the storage of enterprise data in a single (or a few) locations, and these are managed by a single provider. Cloud facilities are outsourced, but essentially centralised. While decentralisation moves data storage into the next realm, many experts share the opinion that blockchain data storage can soon become a new standard.
“The way we treat data is likely to change massively”, says Anatoliy Lytovchenko, Head of Software Engineering and Development Office at ELEKS. “People start realising that their personal data is a valuable asset: some want to trade it, some would prefer to keep it private. Centralised data storage becomes an attractive target for hackers, so logically, blockchain with its promise of security and disruptive features can become a winning option.”
Why use decentralised data storage?
- Bullet-proof security. Cleary, decentralised data storage will only work if security is tight, and the data encryption typically applied to decentralised storage is extremely strong. Decentralised networks also remove single points of failure because your storage is not dependent on a single actor, or a single location.
- Immutability. Decentralised networks can borrow from blockchain functionality, ensuring that no single party is in control of data. Data becomes immutable — in other words, guaranteed to be correct — because a correct copy is stored in multiple places.
- Optimized costs. Storage that is decentralised optimises costs because storage marketplaces make use of capacity that is already spare. There is no need to buy infrastructure to store your enterprise data, it is simply committed to decentralised storage that is already available.
- Scalable infrastructure. Storage marketplaces are vast networks with massive storage capacity. These decentralised networks can adapt to your requirements: scaling up when necessary, scaling down when no longer needed.
Decentralised data storage and blockchain is a powerful combination
Decentralised data storage relates closely to blockchains because many of the concepts overlap. Blockchain itself is a decentralised data storage network, but the way blockchain operates makes it better suited to storing and handling transactional data.
Blockchains can be used for secure document transfer in multiple areas. However, blockchain data storage cannot cope well with large amounts of raw data. This is where decentralised networks can lend a helping hand to blockchains.
Until recently many of the popular decentralised apps (dApps) that are blockchain-driven had to make use of traditional cloud storage providers for data storage. But cloud storage is not a good match for incredibly dynamic blockchain applications. The concept of decentralised data storage (which includes storage marketplaces) provides a way forward, enabling apps such as prediction markets to flourish, unencumbered by the vast amounts of data that needs to be stored and processed.
Which sectors benefit from blockchain data storage?
The cost and scalability of decentralised storage make it suited to a vast array of industries. That said, features such as the immutability of data and the potential for extremely high levels of security have a narrower but incredibly valuable purpose. These features make blockchain data storage particularly well suited for industries that are highly regulated, such as healthcare and financial services. Protecting data and verifying the validity of stored data is paramount for enterprises operating in the fields of health and finance.
Just as cloud computing carries risks due to the involvement of third parties in data handling, so does blockchain data storage. Any technology that relies on distributed networks require close monitoring, but the tight security measures applied to these technologies often result in extremely effective measures.
Yes, adopting new technologies, including blockchain and decentralised data storage, carries risks and costs, but these can be mitigated. Mitigation starts with the right partner. A partner that will also help your enterprise get the maximum benefit from advanced technology.
Get in touch with us to see how your business can realise the advantages of decentralisation, including decentralised data storage, and to get further insight into powerful applications such as blockchains and storage markets.
Originally published at eleks.com on August 3, 2018.