Data Storage is Shifting to Blockchain-Based Cloud Technology

    With the new trend of decentralization rising amongst the internet, as it acts as the building block of the new Web3 era, the blockchain is considered the new data-storing technology. This new technology acts as a distributed network where data is shared across nodes without a central authority. Unlike cloud storage, which became the go-to method for storing data, the blockchain provides an extra layer of security and promises the immutability of data. Now, cloud data storage is shifting towards the incorporation of blockchain technology to create a blockchain-based cloud storage system. 

    Blockchain technology can provide great benefits to cloud storage and act as a solution for data privacy and security. 

    History of Data Storage 

    Before we dwell on blockchain-based cloud technology, let’s take a look at the history of data storage. Storing data is not a new phenomenon that suddenly gained mass adoption with the invention of computers. In fact, the oldest form of data storage dates back to the 18th century with punched cards. This was the first way to ‘digitally’ store data by punching holes into a card. The holes represented letters or numbers that relate to specific data. By running the card into a dedicated machine, people could read and retract the stored information. 

    Fast forward to the invention of home computers, data storage took the shape of magnetic tapes and hard drives. The latter at the time was revolutionary since it could hold around 4 megabytes. Imagine 4 mbs? This is smaller than the average song file! But the thing that made a bang in data storage is the floppy disk, as it was the first removable storage medium. 

    This created the need for people to access their data wherever they are and whenever they want. Then came compact disks, USB flash drives, cloud storage, and lastly, the blockchain.

    History of Data

    Cloud Storage

    The latest and most used data-storing technology is cloud storage. Cloud storage is a cloud computing system that allows users to store their data on the internet using a cloud computing provider which users can access through the internet. The revolutionary aspect of cloud data storage lies in the fact that capacity is no longer an issue. All data stored in the cloud is encrypted and thus, many companies and organizations have shifted their data-storing systems to the cloud. 

    Unlike hard drives and flash drives, storing on a cloud server gives you unlimited data storage. In addition, cloud storage negated the need for maintaining a storage area, replacing failed or small devices, or upgrading hardware based on demand. As long as you have internet access, you can access your files anytime from any location.  

    Cloud System

    Cloud storage is cost-effective since there is no additional hardware to purchase, only a monthly subscription based on the capacity you need. It also has high scalability. You can always adjust the capacity to accommodate the needs. 

    However, even though cloud storage is massively adopted and the technology is witnessing ongoing upgrades, this data-storing system has its drawbacks. For instance, users lack complete control over their data because a third party controls it. Also, it is difficult to migrate your data between cloud storage. In addition, cloud storage is internet dependent and a slow connection or an interrupted internet can cause issues in accessing stored files. 

    But, is Cloud Storage Secure?

    Well, storing on a cloud server means that you are handing your sensitive data to third-party companies. This means that you should have complete trust in the company providing the cloud system to not tamper with your data and keep it secure. Many instances of data leakage happened in well-known cloud servers. For example, in 2014, Dropbox leaked its users’ sensitive data because of a security glitch. In addition, some governmental organizations snoop around confidential data held by cloud storage. 

    In addition, cloud storage is very prone to security breaches. Hackers can find security holes and get ahold of confidential data. This especially happens with large companies with sensitive information, such as security numbers and medical records, stored on cloud-based services. This is where blockchain technology can come in. 

    What is Blockchain Storage?

    Blockchain technology is a decentralized peer-to-peer ledger that stores transaction data, and it’s the basis of all cryptocurrencies and non-fungible tokens. The blockchain has no central authority, instead, nodes operate the . 

    The data stored on the blockchain is encrypted by  SHA-256 hashing algorithm. Long story short, it’s hard to reverse-engineer this type of hashing function. Meaning, it would take a HUGE amount of time, computational power, and resources to hack a single block of transactions on the blockchain. In addition, validators/miners (individuals who are operating a node on the blockchain), validate each transaction before adding it to the digital ledger. This way, any tampering with the data could be easily detectable. 

    For now, data storage on the blockchain consists of only storing transactional data. Actual data files such as images or audio files are stored off-chain, on distributed peer-to-peer file storages such as IPFS. This is because you can’t actually store large files on-chain since it would be expensive and would require a huge amount of computing power.

    Blockchain Verification 

    Blockchain-Based Cloud Storage Solutions

    Okay, so how can the blockchain be a solution or add value to existing cloud storage systems if it cannot store large files? Well, blockchain-based storage divides data into multiple encrypted fragments that are linked using hashing functions. These encrypted data fragments are then distributed across a peer-to-peer decentralized network. 

    So, the solution is not to store on the actual chain, instead, the data would be stored on distributed cloud servers that link back to a blockchain. This way, the encryption of data will be based on things like transaction ledgers, private/public key cryptography, and hashing functions. This will create an extra layer of security for cloud storage systems. 

    Moreover, hackers will find it hard to decrypt the distributed data, since each decryption will only lead to a small fragment of the whole information, which can take a lot of time and resources to decrypt the whole file. Let’s see some other benefits of blockchain-based cloud storage. 


    Since the data on these blockchain clouds link through hashes to the digital ledger, it is hard to tamper with the data. This is because the blockchain offers many ways to track the history of certain data. Therefore, it can confirm that no one has tampered with the original file. Imagine if you want to download a ‘supposed’ original file from a certain cloud server, you’ll be able to easily check whether or not the file is the authentic version. 


    Just like said before, since each block of encrypted data, or in this case hash, is linked to the previous block, the blockchain-based cloud will have a sequential verifiable order. This way, you can check when the file was uploaded, how many times it was transferred, and who altered it. 


    Blockchain-based cloud storing systems can ensure the full transparency of all cloud activity. However, transparency doesn’t mean to expose the data to all people. In fact, the data will not exist on a node and no one can actually see what the information is. This is because the cloud will fragment and distribute the data to nodes, which makes users retain their privacy. 


    Since blockchain-based cloud storages function on a P2P network, this cuts the need for an intermediary or a third party. This means that the cloud server will become completely trustless and self-sustainable through the use of smart contracts.


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