Decentralized Storage

Technical Overview

In this module, we’ll explore how IPFS stores files.
For the sake of this course, we’ve mostly focused on IPFS since it’s easy to visualize what’s happening, but there are a number of players entering the decentralized storage space, and each of them has chosen to accomplish this goal in slightly different ways. Generally, the framework for a decentralized storage network can be summarized as shown below. If you would like a deeper dive into this decentralized storage technology, check out our full course on IPFS.


1: The data (A) is broken into many pieces, or shards (B)

2: Each Shard is encrypted (C) using the public key of the user who wants to store the file

3: A hash (D) is generated for each shard

4: The encrypted shards (C) are distributed to the peer nodes for storage

5: The encrypted shards are replicated across many peer nodes, which each share a copy of the common ledger (F)

6: The shard hashes are recorded to the blockchain (E) for reference during retrieval

Because blockchains must be stored on all nodes of the network, data on them is expensive. As a result, hashes are used to represent an image of each piece of a file, and the pieces can then be safely distributed to storage nodes without risk of substitution of compromise.