and its underlying technology, the Blockchain, has undoubtedly shaken up the world of finance forever. It was a pivotal breakthrough in the financial sector’s ability to create a global, immutable and decentralized ledger that records value transactions. Smart contracts are also a key innovation in the world of finance. They have shaped what will be the next version of the internet: the Web 3.0.

Smart contract technology and Ethereum are opening up new possibilities. Decentralization is possible in numerous fields. This can increase transparency, fairness, accessibility, and accountability for all. You can see this in the rise of Non-Fungible Token and Decentralized Finance industries.

Decentralization is not without its challenges. It will require a lot of work and sacrifices. One factor to consider is the scaling issues in Ethereum’s ecosystem. Simple transactions can cost up to 10 dollars if the network experiences congestion. Complex smart contracts can run up to $100 and may require more than 100 transactions to complete.

This issue, as most people know, is not being solved. However, there are many things that can be done. Avalanche and Solana are two examples of new blockchain platforms, but there are other layer 2 options being created for Ethereum. Moreover, the progress towards the launch of ETH 2.0, while slow at some times, may help the network regain its status as the “king of DeFi”.

How about data?

Although the blockchain is a fantastic way to keep track of transactions and balances, there are limitations to its use, particularly in terms of metadata storage and distribution. Although blockchain has been a great tool for tracking transactions and balances as well as permissions, we need to address the issue of decentralization.

The key to decentralizing content storage and delivery protocols could be the solution for democratizing financial literacy and investment.

Building interconnectedness was the key to the success of the Internet’s early days, also known as the web1. The web2 is a web where web applications are required to grow. They are now dependent upon scalable infrastructure providers such as AWS and Azure who often limit their ability to control the content they provide.

While not new, decentralized storage is still an instrumental step when it comes to ushering the “new” era of the Internet. We’ve seen this with P2P networks like BitTorrent. The world’s hunger for decentralized, private and fair models of data sharing (financial and of all sorts) is undeniable and despite the challenges currently being tackled by the most popular ecosystems: including, lack of ease of use and high gas fees, it seems clear that blockchain networks like Ethereum and others are here to stay.

So, what’s next?

As the Web 3.0 age enters, many storage solutions are now competing against centralized hosts in market dominance.

While centralization does have some advantages (faster speeds, greater availability, faster throughput), all of these benefits come with severe drawbacks such as censorship, data privacy and ownership, security breaches, and censorship.

China has restricted social media use, as an example. The access to Facebook (NASDAQ) and YouTube (NYSE:) is restricted. WeChat and Weibo (NASDAQ;), Renren and YouKu are domestic social media platforms that serve as news websites and instant messaging apps. Access to Google (NASDAQ) has been banned in the country. The main search engine used by Google is Baido, which is controlled by the state.

These problems are evident. According to the EU’s top privacy regulator, there has been a 71% rise in data breaches from 2018 to 2019. This is only one example. Data breaches and thefts are more likely when data is stored centrally. Nearly 7.5 million Adobe Creative User records (NASDAQ::) were exposed in 2019 to anybody who had access via a web browser. This included user information such as web addresses, accounts, and Adobe products.

What is the solution? The solution?

How decentralized is this storage system? Is that what you mean?

It is a system that does not depend on one authority. Technically, decentralization refers to a subset distributed architecture that allows all participants to make their own decisions and not rely on one node. The concept of decentralization is a well-known term that covers governance, decision making, control, and other aspects.

Decentralized storage systems are based on free participation and open-market principles. To avoid one point of failure, data can be duplicated on multiple nodes within the distributed network.

Blockchain integration also allows for the logical inclusion public-key cryptography. Data is typically encrypted before it is stored with a host. This makes it only decipherable by the rightful owners and those that the owner chooses to share it. These systems are more secure against censorship, manipulation, and can render any compromised data useless for an attacker.

Cloud storage is a way to store data in multiple locations, rather than one server. They are independent in terms of decision-making power and can be used independently.

Swarm, one of these decentralized cloud storage systems, is a distributed storage platform and content distribution service that uses Ethereum Web3.

Swarm: The Bees are nodes

Swarm is a decentralized storage and communication infrastructure that is censorship and DDOS resistant, and it serves as the foundation for Ethereum’s Web3 stack. Gavin Wood invented Swarm. The project was funded by Ethereum Foundation, which also funds the necessary research until 2020. Swarm received funding through Ethereum Foundation.

This network is composed of a distributed content-addressed chunk storage, where peer discovery and communication takes place via Ethereum’s libp2p layer. Every node in the network acts like an individual worker bee.

It’s a platform that enables members of self-governing societies by increasing their productivity, providing an environment for their digital applications, and offering them access to a global platform. It’s an inclusive, permissionless, and censorship-resistant cloud storage platform that can be likened to being the hard drive of the Ethereum blockchain.

Swarm is similar to the open-source movement in that it shifts cost from developers to users. Resource payments are made using Swarm. They can be realized when they occur. Innovative firms can scale rapidly without needing to raise funds.

Swarm Accounting Protocol (or SWAP) charges nodes to request resources, and then rewards them when they serve those resources. Smart contracts can be built with Ethereum. Swarm aims to provide an environment in which nodes that are aiming for maximum profitability can naturally store and cache content they can easily deliver using SWAP or its address-key-based retrieval protocols.

It’s worth noting that Swarm does not aim to be a competitor to Ethereum in any way, but rather an extension of it. During the projects’ annual event, the “Swarm Summer School ‘21” Viktor Trón, team lead of Swarm stated:

“In general, the overarching line of the talk will be to walk you through this misconception that Swarm is not only a project that uses Ethereum but in fact, Swarm should be considered to extend the ethereum blockchain into a fully-fledged computational environment, which is realizing the much commented concept of the word computer and serves as the operating system of the decentralized internet, and therefore it’s a genuine next step in the evolution of decentralized projects.”

The platform’s native token, BZZ, will be a utility coin targeted at incentivizing decentralized storage and transactions. The team has also created a book on the subject titled the “Book of Swarm,” which has a wealth of information on Swarm and BZZ. There is also the Swarm Whitepaper which, while technical, it’s easier to “digest”.

Swarm raised $6,000,000 in private token sales in February. On June 14, a public BZZ token sale took place via the Coin List. There were over 20,000 people who participated in the crowdfunding campaign following the mainnet softlaunch.

About Swarm

Swarm is a distributed storage platform and content distribution service, a native base layer service of the Ethereum web3 stack that aims to provide a decentralized and redundant store for dApp code, user data, blockchain, and state data. Swarm offers various web3 base layer services including media streaming, node-to–node messaging and decentralized database service. It also provides scalable state channel infrastructure to support decentralized service economies.

Swarm serves as a content distribution platform and distributed storage platform. It’s a local layer service that is part of the Ethereum Web3.0 stack. It is managed and developed by Ethereum Foundation.

Visit Swarm’s website and follow them on Twitter, Discord, YouTube, Github, and Reddit to learn more about the project.

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