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What is a Decentralized Database?

A decentralized database is a type of database system that is spread across multiple nodes or computers, rather than being stored in a single central location. Each node in a decentralized database network holds a copy of the data, allowing it to operate independently and make decisions based on the information it holds.

Decentralized databases are designed to provide a more secure and transparent way of storing and accessing data, as compared to centralized databases. The data is stored in a distributed manner, meaning that it is stored across multiple nodes, rather than in a single location. This makes it more difficult for a single point of failure to occur, as the data is not stored in a single vulnerable location.

One of the key advantages of decentralized databases is that they are more resilient to data breaches and cyber attacks. Because the data is stored across multiple nodes, it is much more difficult for hackers to penetrate and access the data, as they would need to attack multiple nodes at once. Additionally, decentralized databases can be designed to be permissioned, meaning that access to the data is restricted to certain users, further increasing security.

Another advantage of decentralized databases is that they can provide more transparency in terms of data management. In a centralized database, the data is controlled by a single entity, which may have the power to manipulate or restrict access to the data. With a decentralized database, the data is managed by multiple parties, providing a more democratic approach to data management.

Decentralized databases are also often faster and more efficient than centralized databases. Because the data is stored across multiple nodes, it can be accessed from multiple locations at once, reducing the time it takes to retrieve data. Additionally, decentralized databases can be designed to work together in a peer-to-peer network, reducing the need for intermediaries and speeding up transactions.

Simplified Example

Imagine you have a big box of cards with different kinds of information written on them, like your friends' names, addresses, and phone numbers. Each time you want to add a new friend's information, you write it down on a card and put it in the box.

Now, imagine that you and your friends each have a copy of this box of cards, and every time you add a new friend's information, you send a copy of the new card to each of your friends, so they all have the most up-to-date information.

This is like a decentralized database. Instead of having one central location where all the information is stored, like a big box, the information is stored in many different places, like each of your friends' boxes. And instead of having one person control and update the information, like you did with the box, each person with a copy of the information can add and update it, making it a decentralized system.

This way, if one box gets lost or damaged, the information is still safe because it's stored in multiple other boxes, just like in a decentralized database.

History of the Term Decentralized Database

The term "decentralized database" was coined by computer scientists and researchers in the early 1990s to refer to a type of database that distributes data and processing across multiple interconnected nodes, eliminating the need for a centralized server or authority.

Examples

Blockchain Decentralized Database: The most well-known example of a decentralized database is the blockchain technology used in cryptocurrencies like Bitcoin. In this system, transactions are recorded on a distributed ledger that is maintained by a network of computers instead of a central authority. This allows for secure, transparent, and tamper-proof transactions without the need for intermediaries. Blockchain decentralized databases are also highly resilient, as no single point of failure can bring the entire system down.

P2P Decentralized Database: A peer-to-peer (P2P) decentralized database is a type of database where information is stored on the hard drives of individual users instead of a central server. In this system, users can act as both clients and servers, allowing for a more distributed and resilient database. An example of a P2P decentralized database is the BitTorrent file-sharing network, where users can share and download files without relying on a central server.

Distributed Ledger Decentralized Database: A distributed ledger decentralized database is a type of database that is maintained by a network of computers that have a copy of the database. In this system, every participant in the network can verify transactions and maintain a copy of the database, making it much more secure and resilient than a traditional centralized database. An example of a distributed ledger decentralized database is the Interledger Protocol (ILP), which enables cross-ledger transactions between different blockchain networks.

  • Decentralized: Decentralized means that something is spread out and not controlled by one single person or group.

  • Decentralized Application (DApp): A Decentralized Application, or DApp for short, is a special kind of computer program that runs on a decentralized network.