2 - 4 minute read
Decentralized file storage on blockchains such as Filecoin, Arweave, Swarm, StorJ, and Sia is currently much cheaper than traditional Web2 services such as Amazon Cloud or Microsoft Azure, with costs ranging from near zero to $4 per terabyte per month, according to a new report published by Singaporean venture capital firm Foresight Ventures. However, the report also highlighted additional costs associated with decentralized storage, such as data upload fees and retrieval fees, which can amount to $7 per TB. Despite pricing controversies, data from blockchain analytics firm Messari cited in the report show that the total storage capacity of the four largest file storage blockchains increased by 2% year-over-year to 17 million terabytes at the end of 2022. Filecoin currently has the largest market share at 67%, followed by Arweave (19%), Sia (8%), and Storj (6%).
While the cost of storage on blockchain is significantly lower than traditional Web2 services, the report also outlined issues such as “file loss,” “difficult to retrieve data,” and “high bandwidth requirements.” Some service providers only offer storage services and refuse retrieval, which can cause problems for users. Despite these challenges, blockchain storage is gaining in popularity, with network utilization among top players surging to 3.1% compared to just 0.2% in 2021.
On April 27, Filecoin rolled out the nv19 Lightening and nv20 Thunder network upgrades to improve block validation times. As of April, the network has 22.7 million TB of storage capacity and 3,623 storage provider systems. While blockchain storage may face challenges, the technology is evolving to address these issues.
“Price does not account for bandwidth. Some nodes only provide storage services, refuse retrieval.”
According to the report, decentralized file storage on blockchain is still in its early stages, and there is a significant opportunity for growth in the market. Traders and investors should keep an eye on developments in this space as blockchain storage gains in popularity.
The Bottom Line
Decentralized file storage on blockchain is much cheaper than traditional Web2 services, but it still faces challenges such as data retrieval and file loss. However, blockchain storage is gaining in popularity, and there is significant opportunity for growth in the market. Traders and investors should keep an eye on this space as the technology evolves to address these challenges.