Web3 Will Usher a New Era of Data Democratization and Information Sharing
We’re living in the early days of decentralized Web3 data storage.
While Web3 won’t replace the centralized cloud-based Web2 storage options entirely, leading businesses are exploring the possibilities. Mercedes-Benz launched a data-sharing network and Microsoft invested in a startup to bridge the gap between centralized and decentralized databases.
Web2 has been the predominant industry standard for years, and users have grown accustomed to the speed and capabilities that come with it. However, according to IDC, by 2026 the global data market is expected to exceed 221 zettabytes. As the datasphere grows, data storage solutions will need to evolve to keep up with organizations’ cost requirements, data security and availability needs. This is where Web3 comes in, as the storage and retrieval mechanisms that will allow Web3 to pass the Web2 standards are in rapid development.
Although Web3 data storage isn’t ready for large-scale enterprise applications just yet, business leaders are increasingly recognizing its potential. Public cloud has been great at enabling innovation and is likely to continue in this role, but it is smart to plan for the future. Web3 will enable better data democratization and information-sharing opportunities, which will revolutionize the way we store and share data.
How Web3 Can Revolutionize Data Storage
Data control is one of enterprises’ biggest issues. Centralized storage has many benefits, but it also entrusts a single entity to manage vital data flows. Often, this results in high egress and retention fees – creating a gap between how companies want to use data and what they actually do with it. This approach can also invite cyberattacks, network failures, or outages, which are all detrimental to an organization’s revenue and reputation. Web3’s decentralized storage is far from mainstream adoption because of challenges related to scalability, integration, and energy resources. However, it is emerging as a strategic alternative because of its valuable ability to offer immutable, persistent, and replicated data. Through this process, it also offers cost-effective protection against ransomware attacks. Simultaneously, Web3 is built to provide significant protection from nefarious geopolitical censorship policies, and it creates more flexibility in access.
As the Web3 ecosystem continues to grow organically, organizations and services will emerge to assist with the business migration to Web3-enabled protocols. Cloud storage providers (CSPs) have built hundreds of Web2 applications around the data they store. They charge customers for both storage and application use. Web3 will need similar apps that can coexist and even bridge the gap between Web2 and Web3 spaces, which will take time. These applications and services can come from the open-source community or from for-profit independent software vendors. The benefit comes in because Web2 CSPs require customers to use their apps or pay a premium. Web3 will offer more choices at a lower cost. The explosive growth of generated data and the increased value of data from AI is likely to drive the demand for secure storage methods, such as Web3 data storage.
Enabling Data Democratization at Scale
Beyond decreased cost and more control, Web3 storage also offers an innovative approach to publicly accessible information. A Web3 customer can store critical archive data in a network that is not beholden to one of the major cloud vendors for data integrity and security. Rather, the community of storage providers upholds the integrity and security of the data. These features are not native to Web2 providers. Meanwhile, a Web3 storage provider must adhere to these requirements to be on the network.
This way, Web3 can enable massive databases, like public records and released private research data, to be independently verified by anyone with a network connection. It boosts the archival of valuable data at costs that the public cloud cannot match, with durability and geographic distribution they also cannot compete with. In a no-risk exploration of how decentralized storage technology can be an asset to the city, Protocol Labs’ Filecoin is using Web3 to store and maintain publicly available New York City data on demographics, air quality, legal notices, etc.
Increasing Data Integrity Amid Declining Trust
Increasing data democratization also boosts data integrity. Misinformation is a pervasive and insidious threat, especially with the rise of AI-generated images and vocal recreations that are indistinguishable from their original sources. Web3 offers accessibility and low costs for the world’s largest public data sets. Archives that simply could not be hosted on a public cloud without incurring a great expense, like university research data sets, can now be made publicly available at a low cost to organizations.
Imagine researchers from institutions around the world being able to efficiently share data to advance work on pressing fronts, such as disease research or climate analysis. Web3 data storage could remove the gatekeepers of data access. In Web3, documents are stored in immutable, persistent, and globally accessible archives that can’t be tampered with or altered. Today, Starling Lab leverages IPFS/Web3 to preserve the vast data sets documenting crucial knowledge sources from the past (such as massive data sets of information related to wars), helping to raise awareness for future generations.
In the Web2 world, organizations use public clouds and other forms of centralized storage to save data. Centralized players continue to consolidate the market, which can limit pricing options and data efficiency. Currently, corporations with a positive image can deliver messages that are trusted simply based on the organization’s reputation. The public often accepts these companies’ findings as is, since large industry reports are hard to verify. When Web3 technologies are more available and accepted, the public will be able to access the actual data companies are discussing, enabling the public to be more judicious consumers of corporate information. It will also give more businesses the opportunity to participate in the data economy.
There is a business and social need for Web3 to mature, with more time and work needed before it can be a viable mainstream alternative. When it does become widely available, decentralized storage networks will offer organizations and consumers numerous benefits including a unique level of transparency, efficiency, verifiable trust, and equal access to data – all at what is likely to be a competitive cost.
- Web3 Will Usher a New Era of Data Democratization and Information Sharing - September 15, 2023
