How Companies Benefit from On-Chain File Storage

Secure and accessible file storage is good for business. 

Customers are more willing to use an app when they know that no one, including the platform hosting the apps, has access to their files. A data breach or file recovery problem can be very costly. Customers also benefit when their files can be readily accessed and used with automation solutions.

Currently, most files are stored in the corporate cloud, a market dominated by Amazon, Microsoft, and Google. Increasingly, however, organizations are looking for decentralized storage solutions. These solutions present a superior alternative to traditional storage because they give users more control, security, and accessibility. 

Static Decentralized Versus Dynamic On-Chain Storage

Decentralized file storage means that files are not stored on a single or small group of servers controlled by an organization. Rather, in a decentralized system, files are stored on servers that are part of a network not controlled by any single entity or group. An example of decentralized storage networks is the popular Interplanetary File System (IPFS). 

Static decentralized storage is not the same as storing files directly on a dynamic blockchain network, however. This is important because a powerful blockchain offers several advantages compared to decentralized storage solutions such as IPFS. 

Storing files on the Internet Computer blockchain, for example, has the following advantages:

Permanent and Immutable Storage

The Internet Computer uses “cycles” to process data and store files. Users can easily make storage permanent by setting a canister to automatically refill without requiring the involvement of any third parties. Files stored on chain can also be set to be completely immutable and tamperproof. 

By contrast, long-term storage decentralized services such as IPFS requires paying and relying upon third parties. IPFS also requires data to be regularly accessed or else it will be deleted. This is completely unsuitable for most companies, NFT buyers, and many other use cases that do not frequently access certain files. 


Cybersecurity and User Privacy

Files stored on Internet Computer blockchain can be made completely private from on third-party online access. This means that neither the link to the file nor any on-chain data is searchable, hackable, or viewable by developers. All communication to and within the blockchain is encrypted using enterprise-grade transport layer security. 

In addition, storing and reading files on the blockchain does not reveal anything about the user which could make them vulnerable to hacks, such as identity or credentials. Files on chain can also be selectively shared with parties based on their roles (e.g, admin, owner, user), or be made public. 


Importantly, files stored on blockchain cannot be viewed by the app builder. This means that an app’s customers can be assured that no third party can view their data.  

By contrast, decentralized file storage does not offer these privacy safeguards. For example, viewing files on IPFS may reveal the identity of the reader and the party storing the files. Gateways on IPFS disable browser security features and may expose content when first shared with the network. None of this is true with blockchain.

Dynamic Content and Smart Contract Automation

Another major benefit of the Internet Computer blockchain is that it is as fast as the regular web. This means that uploading, reading and downloading files takes place rapidly to meet the needs of modern users. Here’s an example of an on-chain PDF that loads rapidly.

Decentralized storage solutions, on the other hand, are not optimized for speed. IPFS is often slow and requires third party applications to speed up.

Unlike decentralized file storage, blockchains don’t just store files, they also process data using a decentralized network.

The Internet Computer blockchain performs calculations and automates business processes with fast and scalable “smart contract” programs. This way, smart contracts have direct access to stored files. By contrast, decentralized storage solutions need to rely on third party applications that are insecure and costly to use smart contracts.

Blockchain Storage Via API

With storage costs of $0.46 GB/month, the benefits of on-chain storage can far exceed its costs. Read more about ICME’s API for on-chain storage here and contact us if you have any questions.

About the author

Houman Shadab is a cofounder of ICME