Since the launch of the Ethereum network, cryptocurrencies have become more mainstream, thanks to its ecosystem’s support for tokens to be used in smart contracts. The network has made it simpler to develop tokens to be used for specific tasks through the ERC standards. The most common token standard, ERC-20, has had its fair share of drawbacks. This triggered the development of ERC-721, a standard that applies ERC-20's basic structure while alleviating its shortcomings by helping to represent and track non-fungible assets.
ERC-721 token standard is applied mainly for developing non-fungible tokens (NFTs). These tokens are neither interchangeable nor have an equivalent, but are valued based on their uniqueness, usefulness or scarceness. Its applications include:
Art: NFTs have opened possibilities for tokenizing works of art. For instance, using NFTs, artists can tokenize their digital work, developing scarceness hence preserving value for their work.
Gaming: NFTs are applicable in gaming as in-game items such as collectibles that can be stored in the Ethereum wallet that can then be sold later.
Real Estate: NFTs also allow for dealers of real estate property to develop a unique value for a specific property, since property value may vary for each real-estate property based on many factors including location, size and many more.
Other applications include copyright, software licenses, loyalty programs, and warranties, even academic degrees!
Now I’ll head over to our main topic: how blockchain is feasible for data storage.
Tracking non-fungible assets are evidently beyond the scope of the ERC-20 token standard. NFTs developed from the ERC-721 standard fix this problem while creating even more applications for the blockchain technology than we could ever imagine. Here are the advantages:
Uniqueness: ERC-721 enables the uniqueness of each NFT allowing non-fungible assets to attain its unique value. For instance, one painting is different from the other, rare and unique.
Simplicity: ERC-721 simplifies the complex tracking of the value of a property by accounting for all possible factors that would otherwise be difficult in ERC-20.
Representation of Ownership: NFTs, unlike ERC-20 tokens, represent ownership of an investment. Thus, one can own an artwork indivisibly and without losing value.
Technically, using blockchain to store our data is less prone to hacking or data breach because. In order to hack a blockchain network, an individual has to acquire a 51% majority, which is practically infeasible for anyone because the cost associated with it is too high. Thus, we can say that hacking a blockchain database is very time-consuming, costly, and more complicated than centralized cloud-based storage.
Even if the hacker manages to gain access to a single node, he can’t access the actual data because the data stored in the blockchain is cryptographically protected.
One of the most appealing applications of blockchain is its ability to remove it reliant on an intermediary and paves the way for a trustless environment. This is practically possible because blockchain stored all the data in a distributive ledger which is publicly accessible to all the participants of the blockchain network. Therefore, data stored in the blockchain is transparent and widely accessible.
Blockchain stores the contractual data between the two peers in an encoded form known as a smart contract. Therefore, blockchain can disrupt services business like a legal expert and real-estate brokerage. It is pertinent to know smart contracts coders aren’t legal experts, so the encoded terms of trade between two peers cannot be used in the supreme court.
Blockchain-based data storage is still in a rudimentary stage, but many strongly believe blockchain technology is suitable for storing a large volume of data, but the scalability is the obstacle in the way of blockchain for data storage. though strenuous efforts have been done by the blockchain developers to resolve this issue, it still needs to be fine-tuned for data storage.