How Blockchain Based Storages are Better than the Traditional Cloud Storage?

The next few decades are going to be about big data. All industries have storage requirements not only to process but also compute tremendous amounts of data. Blockchain-based storage, even in its infancy stage, is emerging as a better alternative to the traditional cloud storage systems.

How does Traditional Cloud Storage system work?

Let’s say you have a small business where you maintain a specific type of data over the cloud. For the same, you use a service such as Google drive. When you upload and save something to the Drive, Google stores it one of its many data centers spread across the world. Next time when you need the data, your computer will send a ping request to the location where your data is stored, and that’s how you’ll be able to access your files or documents.

Challenges with Traditional Cloud Storage System

Physical location, of course, is the first challenge with traditional cloud storage system. So in the above example, it’s possible that the data center and your location is far apart; which can cause delays as well as errors. Not to forget, the usage of large-scale servers is expensive. Along with multiple levels of operation and constant monitoring, the tech maintenance takes up significant resources.

However, the critical vulnerability of a traditional cloud storage system lies with privacy issues and even tempering of data. Since the data technically is being controlled by one authority (in our example – Google), it virtually grants the access for compromising of data at multiple levels. In fact, in Google’s privacy policies, one of the points is regarding how it can share your data legally with large corporations.

Since there are hierarchical layers to organizing and maintaining the data, the scope of human errors is quite high. That puts the safety of your data at risk.

What’s the alternative?

Few small teams and organizations across the worlds have started using blockchain based storage. It helps them in three significant ways:

  1. It significantly reduces the chance of human error

  2. Increases the overall security and privacy of any data

  3. Compared to the traditional cloud storage, the blockchain-based storage is cost-effective and efficient

How can the blockchain be used for storage?

Blockchain, as a technology, decentralizes the cloud storage by eradicating the requirement for a trusted third party. Since every single transaction is logged along with being time-stamped, data is sufficiently secured, and it cannot be tampered with in any form. The involved node can’t be changed, so blockchain-based cloud storage ensures that the data at all given points is accurate. A blockchain-based storage system is both transparent and traceable. It ably deals with the shortcomings that are a crucial part of traditional cloud storage modes.


The amount of data generated over the Internet is only going to multiply at a tremendous rate. The need of the hour is a cloud storage system that doesn’t compromise on data immutability while being affordable and efficient. Blockchain-based storage might be the solution the world will sooner or later need.

Centralized vs Decentralized Blockchain

Blockchains have garnered interest from investors from all over the world due to their incredible promise of being an incorruptible ledger. When most people think of blockchains, they are referring to the decentralized or public blockchains like Bitcoin which anyone can access and participate in. However, blockchain technology is not limited to being just decentralized as the centralized or private blockchains also have some advantages for corporations over the public ones. Private blockchains are useful for corporations who want to use the power of decentralized ledgers to improve the ongoing function. Let’s take a look at an in-depth comparison of public and private blockchains.


Similarities Between Centralized and Decentralized Blockchains

From a technological standpoint, both centralized and decentralized blockchains are very similar as both are distributed peer to peer networks where every node is responsible for storing and securing the shared ledger. Both public and private blockchains require a consensus mechanism (like proof-of-work or proof-of-stake) among nodes to establish a single ledger. Both of these types of blockchains also have to provide upper and lower bounds on the security and efficiency of the network.


Differences Between Centralized and Decentralized Blockchains

The biggest factor that differentiates public blockchains from private ones is the pool of nodes that can participate in the network, and make administrative changes to the network. So, for example, Bitcoin which is the largest public blockchain in the world has no barrier to entry when it comes to accessing the ledger and sharing computer power to execute its proof of work algorithm. By contrast, IBM’s HyperLedger Fabric is more customizable in the sense that the organization that is deploying the blockchain has a say in every aspect of blockchain participation. Private blockchains are typically more restrictive in who they allow making changes to the ledger as they use the blockchain for the internal records.


Advantages of Decentralized Blockchains

Decentralized blockchains like Bitcoin, which is the most popular blockchain in the world, have very high security because of the enormous amount of mining resources that go in to secure the network. That means to coordinate a successful attack on the Bitcoin network; a malicious actor would have to acquire a massive amount of resources which is economically unviable. Another advantage is that anyone can use the network to send funds to any part of the world without going through an intermediary.


Disadvantages of Decentralized Blockchains

Due to their public nature, public blockchains like Bitcoin are susceptible to all kinds of analyses that can reveal more information about the network participants making the blockchain less private. The massive amount of miners mining on the network means that difficulty needs to keep increasing thereby leading to mostly useless computations done by miners to outcompete each other. It is estimated that every Bitcoin transaction costs about as much electricity that is required to power an average home for eight days. Therefore public ledgers are not very environment-friendly.


Advantages of Centralized Blockchains

Centralized blockchains offer much more customizability and control over the network to the organization deploying it as they can decide who gets to participate in the network. That means that not as much resources have to be invested in competing to secure the network which makes Centralized Blockchains more environment-friendly compared to their Decentralized counterparts. This also means that they have higher overall throughput because they get to decide the hardware that the network runs on. In practice, this means that corporations could use private blockchains to store sensitive information among nodes that they trust. This allows them to use the incredible power of blockchains without having to make the sensitive information public.


Disadvantages of Centralized Blockchains

Since there is not as much computing power securing the network as in the case of decentralized blockchains, centralized blockchains are less secure. It only requires a few of the nodes hosting the network to collude by amassing enough resources to hack the network. Also, since transactions are not publically viewable, it is harder to verify the authenticity of the transactions for an outside party. Also since private ledgers are not available for public use, they are of little use to anyone besides the corporations that deploy them.