The need for outsourcing storage space for commercial and individual use is growing at a furious pace. As the amount of data produced daily grows so does the costs of storing it. The data market has a $3 trillion value and the cloud storage market will reach almost $90 billion by 2022. One terabyte (TB) of cloud storage space costs an average of $22 on Amazon Web Services, Google, Dropbox or Microsoft. However, Cryptocurrencies projects like Storj, Sia, and MaidSafe are making data storage much more affordable thanks to the use of the blockchain. They share the concept of eliminating intermediaries by providing P2P data storage through driveshare.
SIA is a decentralized storage platform secured by blockchain technology. It started in 2013 by two MIT computer science students, and it basically pays people to rent out their unused hard drive space via SC tokens. Its main selling points are privacy, cost, and security. In conventional storage, companies have access to user’s data stored on their servers. In contrast, SIA uses a blockchain which requires encrypted private keys in order to access the data. SIA is cheap; it cost one tenth the price of regular vendors or $2/mo per TB of space. Security is provided though Proof-of-Work (POW) and Proof-of-storage (POS). POW is done by having a distributed network where each device acts as a node that produces a block every ten minutes, reinforcing security and preventing a 51% attack. POS requires a series of proofs (per contract) within a limited time in order to grant data access.
This is also a decentralized, open source, cloud storage platform where anyone can sell their extra hard drive space. Storj uses the free space in the seller’s hard drive to store customer’s data in them and pays the seller in Storj coins. Sellers download the Storj’ s software called Driveshare and specify how much space and bandwidth they are willing to share. This process is the equivalent to mining but miners are called “Farmers.” However, instead of computing power, they contribute with storage space. The customers choose how data is partitioned, encrypted, distributed, abd stored among the farmers. The user then makes micropayments for the service. Storj is also a way to make passive income.
MaidSafe (Massive Array of Internet Disks, Secure Access for Everyone)
MaidSafe is the token for the Safecoin currency; they’re both components of the SAFE network. The SAFE network is a marketplace for digital resources where anyone can sell hard disk space, computing power, and data connectivity. Like SIA and Storj, it pays Farmers to store and manage the data and users to pay for the service. And it hashes and encrypts the customer’s data using their “Vault” software – the equivalent of Storj’s DriveShare. Despite having a head start over its competitors MaidSafe is still a long way from full development.
In the end, like a lot of crypto projects, these three are very similar and almost seem to borrow from each other. Nevertheless, they have three distinctive differences between them and the major legacy companies. One is security; where companies are responsible for maintaining the data safe, the crypto-based newcomers make use of cryptography to safeguard information. The second is the decentralization of the cloud storage network where the network becomes an alternate internet in its own right. And third, is the reduced cost achieved by eliminating large, expensive servers. The costs of the hardware are minimized and shared by all the participants in the network.
All these projects, however, share a major flaw – the hardware and electricity cost is currently higher than the rewards. This prevents industry-wide adoption and price gain of their cryptocurrency. Nevertheless, as storage efficiency and capacity increases, all three projects stand to benefit and gain value.