Flostream Project Analysis Innovative Decentralized Storage and Content Distribution Solution

Exploring the Innovative Decentralized Storage and Content Distribution Solution of the Flostream Project A Comprehensive Analysis

Written by: Feng & Carol, DFG

Why is decentralized storage crucial for crypto and Web3?

For a long time, public Layer1 blockchains like Bitcoin and Ethereum have relied on the development of external storage technologies because, for several reasons, blockchains are fundamentally unsuitable for storing large amounts of data:

• Blockchains are designed for value transfer, not for storing large amounts of data, and storing data in blocks is very expensive.
• If a large amount of data is stored in blocks, network congestion becomes severe, resulting in a Gas war and increased fees.
• Even if blockchains accommodate storing large files through scaling, the data structure of blockchains means that block information is mostly stored in encrypted and compressed forms, making it unsuitable for file retrieval and analysis.

Clearly, these cost and efficiency issues cannot be solved by centralized storage service providers, whose data is subject to censorship and has mutability, contradicting the spirit of blockchain and Web3.

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Decentralized storage networks (DSNs) have become the mainstream solution to achieve decentralized storage, which is a storage business model that uses blockchain as the underlying technology and stores files or collections of files in fragmented form on storage spaces provided by suppliers.

In an ideal state, a DSN must be able to store, retrieve, and maintain data while ensuring that all participants in the network are incentivized for their contributions, while maintaining the trustless nature of the decentralized system. However, in practice, each DSN project has made its own trade-offs and compromises. For example, Filecoin pursues decentralization, but due to its computationally intensive proof-of-spacetime algorithm, it has slow write speeds, affecting storage experience and performance; Storj sacrifices some decentralization characteristics in pursuit of high performance; and the innovative Arweave achieves permanent storage but at higher storage costs, making it more suitable for NFTs and DApps.

Currently, the overall market size of the decentralized storage race is relatively small. According to a report published by Messari, the total revenue of the top four storage protocols (Filecoin, Arweave, Storj, and Sia) in 2022 was only about $14.5 million, which is in sharp contrast to the current demand in the cloud storage market, which is in the billions of dollars. According to a research report by Vantage Market Research, the global cloud storage market is expected to grow from $90 billion in 2022 to $330 billion in 2030, with a compound annual growth rate (CAGR) of 17.7% between 2023 and 2029.

The adoption of new technologies such as the Internet of Things (IoT), Artificial Intelligence (AI), and automation is driving an exponential increase in data creation and storage demands. While centralized data storage providers dominate the market, they expose many drawbacks in terms of data and market monopolies. The decentralized storage field urgently needs more disruptive startups to join in and change the game, in order to promote the realization of Web3 use cases that have high demands for data sovereignty.

 

Global Cloud Storage Market Size Forecast / Source: Vantage Market Research

Flostream Network: Decentralized Web3 Infrastructure Service Provider

Flostream Network aims to bring some changes to the decentralized cloud storage market. Flostream is a decentralized Physical Infrastructure (DePIN) service provider that is building a brand new decentralized storage and distribution solution for Web 3.

Flostream Network not only provides content storage services through an Amazon S3 compatible API, but also enables fast content retrieval, on-demand content distribution, and supports applications such as social media or video on-demand streaming, with performance comparable to Web 2 products.

Flostream’s design will allow users or applications within its ecosystem to enjoy data persistence, security, and reliability. Any data loaded into Flostream is completely owned by the user, ensuring the digital property ownership of the data. Flostream has a local validation service that can validate any loaded data through digital signatures and timestamps. The Flostream team aims to protect the integrity of the internet through permanent storage and native authentication features, allowing users to back up their social media profiles, creator content, or copies of the entire internet on the Flostream network, thus safeguarding the truth in the era of deepfakes and AI.

Flostream Storage and Content Availability

Flostream’s founder David Rhodus previously worked at ConsenSys, where he developed several Ethereum-based POC (Proof of Concept) products for large companies, many of which ultimately faced scalability issues. David and his team spent a lot of time experimenting with how to connect distributed systems with blockchain and how to control these systems using blockchain.

During the process of developing an open, decentralized wallet-to-wallet messaging meta-protocol, the team encountered a scalability issue. The massive amount of communication generated a huge amount of data, and the Flostream Network team realized that existing decentralized storage solutions (such as IPFS, Filecoin, Crust, etc.) have many limitations. This prompted Flostream to start seeking its own decentralized storage solution.

Flostream has now launched its own Amazon S3 compatible storage service, Flostream Storage, which has undergone substantial innovation in terms of underlying technology and storage architecture design in order to achieve differentiation. By introducing proprietary metadata layers, the Flostream Data Transfer Protocol (FDTP), and cutting-edge hash algorithms based on BLAKE3, Flostream Storage is expected to effectively address scalability and low-performance issues currently faced by the decentralized storage market. The purpose of developing a proprietary storage protocol is to optimize content distribution and ultimately become the content availability layer of Web3, enabling easy storage, movement, retrieval, and distribution of data.

Technical Overview

Flostream Storage consists of multiple units, each containing a storage cluster and related control and monitoring infrastructure. These units provide customers with Amazon S3-compatible storage services, ensuring the isolation and security of customer data. The units consist of storage nodes and gateway nodes, with the latter serving as the entry point for the unit’s storage cluster. Nodes in the cluster can act as either storage nodes or gateway nodes. Both types of nodes can communicate with all other nodes in the cluster, maintain the metadata database, and provide S3 API endpoints.

Flostream Storage Architecture consisting of storage and gateway nodes / Source: Flostream Documentation

Competitive Landscape

Currently, both mainstream centralized storage providers like AWS and Google Cloud, as well as decentralized storage providers like Filecoin and Arweave, have noticeable shortcomings. Centralized solutions offer high storage performance but are not cheap and are susceptible to single points of failure. Decentralized solutions offer relatively cheaper prices (except for Arweave, which has a one-time payment model), but they suffer from performance limitations in terms of storage and throughput, making them unsuitable for large-scale, high-concurrency Web3 applications.

The existing pain points of distributed storage protocols like IPFS include storing data on expanding node branches and relying on linear file retrieval methods, which limit scalability and speed. Flostream aims to achieve both the performance advantages of centralized storage providers and affordability, with lower network latency than prominent decentralized storage projects in the market, seeking a more balanced storage solution.

To address these bottlenecks, Flostream Storage utilizes a proprietary metadata layer for fast data retrieval and low-cost operation. Additionally, Flostream employs a proprietary advanced hash algorithm based on BLAKE3 for data compression and network management, which is 14 times faster than the SHA-256 algorithm used by AWS. It also introduces a high-performance data transmission protocol called FDTP, which is optimized based on the existing UDP protocol. Flostream also incorporates intelligent data placement and migration, where AI-powered data location migration reduces hotspots deployment, allowing edge storage to handle data closer to the data source for faster access and improved throughput during high loads. Its self-developed intelligent duplicate data deletion algorithm minimizes storage redundancy and optimizes capacity utilization, thereby reducing costs and improving data transfer speed. Through a series of technological optimizations, Flostream Storage achieves significant improvements in multiple dimensions:

• Storage and bandwidth prices are lower than centralized providers like AWS and Google Cloud, although slightly higher than decentralized projects like Filecoin and Storj. However, it offers superior storage and bandwidth performance under equal cost conditions.
• Read/write throughput can reach the level of current centralized storage providers and far exceed prominent decentralized storage projects like Filecoin, Arweave, and Storj in centralized operation mode.
• Maintains similar high scalability and low latency as centralized storage providers.

Flostream currently serves thousands of individual users and is piloting with multiple companies, with plans to migrate storage workloads from AWS and Google to Flostream in the future.

A Solid and Experienced Team

The Flostream team members have rich experience in blockchain, software engineering, cloud computing, data storage, and project management. They are committed to leveraging their skills and resources to provide the most advanced Web3 solutions in the encryption industry. Founder David is a serial entrepreneur with over 25 years of engineering experience. As early as 2010, he built a streaming platform that supported over 100,000 live sports events annually and was eventually successfully acquired by Amazon Web Services, which is not common among Web3 entrepreneurs. In 2015, he joined Consensys, focusing on the development of enterprise blockchain solutions. David’s background in serial entrepreneurship not only provides strong support for the project, but also attracts attention from many well-known institutions. Flostream completed a $3 million financing round in February this year, with participation from DFG, Fuse, Scytale, D1 Ventures, and TRGC, making it one of the few decentralized storage projects that can still attract external funding in the bear market of cryptocurrencies.

Summary

Currently, the majority of the cloud storage market share is still dominated by centralized solutions provided by giants such as Amazon and Google. Decentralized storage projects have not yet demonstrated significant advantages in user experience, performance, and cost. These decentralized projects mainly operate through mining, attempting to attract users through token incentives, which leads to a large loss of users when token incentives decrease in the bear market of cryptocurrencies. Without the native attributes of Web3 applications, they will inevitably fail to attract more users and enterprises and achieve scalable growth in the long run.

Although decentralized storage can solve many problems such as data privacy protection, anti-censorship, and avoiding single points of failure, the development of decentralized systems is still immature, and there are still many problems that need to be solved. The industry scale of decentralized storage has not yet reached its peak. Due to the overall market slump in the previous bear market, lack of content distribution capabilities, and limited application scenarios, even top decentralized projects like Filecoin, Arweave, and Storj are unable to compete with centralized storage giants in terms of market size.

With the maturity of Layer2 technology, DApps are becoming faster and cheaper to run. Web3 application narratives are returning to the mainstream, and the accumulation of massive data and market demand will once again turn the industry’s attention to decentralized storage. In the future, the entire DSN market will need more middleware and aggregators to handle more user traffic, and at the same time, it will need to continuously adjust and optimize the threshold and cost of DSN applications to attract more users. Flostream’s storage and data availability products are currently the ideal solution that seamlessly integrates DApps and decentralized storage. As an early investor in Flostream, DFG is pleased to see that Flostream’s products are bringing more practical and viable application solutions to the broader Web3 market. David, as a veteran in the cloud services industry, has already proved his exceptional leadership and creativity with his previous entrepreneurial project being acquired by AWS. We firmly believe that David can lead the team to the next success and enable Flostream to successfully lead the innovation of the new wave of decentralized storage and Web3 applications.

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Original Text: https://dfg-official.medium.com/an-emerging-decentralized-storage-solution-revolutionizes-content-storage-and-availability-e9464472d5b8

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