# Decentralised Storage web 3.0

**Core**
The digital lending platform prefers a paperless process for document sharing. Blockchain and decentralized storage systems combined to provide secure and reliable data storage management.

**Blockchain**
Blockchain is a distributed ledger technology for recording transactions between two or more parties. A new node/transaction is published to the blockchain network for an individual loan request. The node/transaction may contain information about the request, timestamp, user information, personal/financial documents. 

Storing the entire document on a blockchain is possible but it has its own limitations. Decentralized storage offers a distributed way of storing and referring to files by hashes. These hashes become part of a node/transaction for people who act upon the shared blockchain network.

**Distributed System**

**IPFS** - IPFS is a distributed system for storing and accessing files, websites, applications, and data. It’s a  peer-to-peer protocol where each node stores a collection of hashed files. A client who wants to retrieve any of those files enjoys access to a nice abstraction layer where it simply needs to call the hash of the file it wants. IPFS then combs through the nodes and supplies the client with the file.

**Others** - 
Tardigrade (Storj network)
With Tardigrade cloud storage, your files are encrypted and split into pieces client-side before being distributed across a network of high-performance storage nodes.

FileCoin..
Sia..
Swarm..

**How IPFS works**


![Decentralized Storage.png](https://cdn.hashnode.com/res/hashnode/image/upload/v1646328374964/8PxRS0Abw.png)


1. The user encrypts the file by available public key before it gets added to ipfs network.
2. A hash will be generated for the file object by ipfs network.
3. This hash is bonded to a node/transaction published to a blockchain network.
4. The loan processor joins the blockchain network for validating a transaction.
5. The processor retrieves the hash from node/transaction and the same is further posted to ipfs network to pull prior file objects.
6. Finally, the file object is decrypted by already shared public keys with the user.

> Thus a peer to peer hypermedia protocol is designed.