Until now with Web 2.0 (YouTube, Instagram, etc.) Our data would be stored in a centralized server. Think of a massive hard drive inside a truck parked somewhere, maybe an Amazon Web Services warehouse.
With Web 3.0 we have evolved and now able to store our files in a decentralized, safe and private manner. Our data will truly remain our own, a database of the people, for the people, by the people.
How does IPFS work?
IPFS (InterPlanetary File System) is a distributed, peer-to-peer system for storing and accessing files, websites, applications, and data. The system is made up of all the computers connected to it, known as Nodes. Nodes can store data and make it accessible to anyone who requests it. When a file is added to the IPFS, it gets divided into cryptographically hashed smaller pieces of data. Each chunk of data gets a unique Content Id (CID), every chunk contains a link to the other chunks that makes up the whole file. The CID works like a permanent record of the file which ensures it exists on the web. When a node requests the file from their peer nodes and downloads/views the file, the node caches a copy and becomes another provider for the file until their cache gets cleared. Also read our article on why the IPFS reduces fraud.
How is IPFS different?
IPFS utilizes the following concepts:
1) Content addressing
Alice: Go to the Senate House Library at Malet Street, go up to the third floor, go to the technology section, and find the 7th book on the 5th shelf.
Bob: Check out Mastering Ethereum. It has the ISBN 9784873118963
In the above example, Alice uses location-based addressing while Bob uses content-based addressing to find the book. Similarly, IPFS addresses a file by what’s in it, or by its content instead of addressing the file in which node and on what IP address the file is stored.
2) Decentralization
World Wide Web works on the principle of ownership and access, meaning we can only access files from owners after they grant access through 3rd part admins. Meanwhile, IPFS is based on the idea of possession and participation, where all the nodes possess the files of each other and make the files available by participation, and those who can prove ownership may control it.
3) Participation
IPFS works well when an increasing amount of computers are actively participating. If your computer is used for file sharing on the IPFS node, and you turn it off, it may hinder everyone else ability to efficiently access your files.
How can NFT Marketplaces use IPFS?
NFT Marketplaces utilize IPFS to truly decentralize their applications. When NFTs are minted on a marketplace (a decentralized platform) the underlying files (metadata and digital asset) itself can be stored on the blockchain to make the make the app truly decentralized. Opensea, one of the largest NFT marketplaces in the web3 space, launched a feature allowing user to “freeze” their NFT metadata, enabling creators to store data in a decentralized manner. Using IPFS, NFT creators that use OpenSea can now create immutable NFT metadata using IPFS content addressing. Other services like Pinata allows users to store the underlying digital files on a secure IPFS where owners who hold the NFT smart contract in their wallet can access and download the “Submarined” digital good.
