We’re entering an exciting new evolutionary stage of database models. The previous stage took us from the single-system model to the centralized cloud model. This progression was huge: in one fell swoop, it reduced points of failure and delivered enhanced performance.
The evolution of the Database Models
The decentralized database model now promises even greater achievements, enabling us to remove all points of failure, scale more efficiently, provide greater privacy and data immutability, and boost performance even further. Most importantly, this model is helping developers overcome the limitations of blockchain technologies and build scalable, efficient apps.
Blockchain technologies are powering up the next generation of the Internet. Protocols like Ethereum provide a platform for launching decentralized applications (dApps) that will change the way we consume products and services. These dApps will exchange massive amounts of data that require storage and management.
To get an idea of the enormity of this requirement, just look at the Internet of Things (IoT): Gartner predicts that by 2020, 20 billion connected devices will be in use, requiring the generation, management, storage, and retrieval of enormous amounts of data.
Source: Gartner 2017
The problem with blockchain-based protocols is that they lack the capacity for the efficient, scalable storage and management of such an overwhelming volume of data. dApp developers are building the world’s next apps on the blockchain, but using traditional cloud-based databases to power them, which is like trying to slide a big square peg into a small round hole.
The decentralized database model removes this limitation, meeting dApp developer requirements and delivering high levels of performance, reliability, security, and scalability.
Here are a few use cases that demonstrate the benefits of this blockchain breakthrough:
Predictions Markets
In order to function, decentralized predictions markets on Ethereum require the management and storage of massive amounts of data, including:
- Queries
- Different possible answers, or outcomes
- Predictions
- Sourced information for the actual events
A decentralized database can grow and scale as per each product’s needs. Fast and reliable access to data is vital to the success of any predictions market, drawing new customers and increasing participation. Historical data stored on a decentralized database will add a new category of predictions that can use past events to ensure better predictions, reducing riskier human speculation.
Currency Exchange Protocols
Relayers make up a key component of a currency exchange protocol; they enable makers and takers to connect via off-chain order books. Relayers must be able to supply underlying order-books quickly, efficiently, reliably, and easily. This can be difficult, as each relayer stores their order-books in their own way. A decentralized database enables currency exchange protocols to provide relayers with a readily available standard, consistent, and ubiquitous database that they can access effortlessly. This reduction in friction maximizes service levels and quality as the network remains powered by relayers.
Data Streaming Networks
Data streaming networks match up data consumers with data producers. For example, a car uses real-time traffic data from a data streaming network, and collects real-time data whenever it’s in motion. This car is both paying for the data it “buys” and “earning” from data it “sells” to the network. All data points must be readable and writable with high performance, availability, scalability, security, and reliability. To meet these requirements, the decentralized data base model provides an infrastructure that allows a data streaming network to store all of its data.
We now have powerful tools that are enabling us to build a highly efficient and scalable decentralized Internet. All the performance and security issues we have been coming up against in the last ten years can be solved. And that is exciting.