Three factors allow Arweave’s technology to be a permanent storage system:
- Indelible Code. The Arweave protocol or the code is written in a way that does not allow anything to be deleted.
- A Decentralized Network. Instead of one centralized server that keeps all your data, files are distributed and replicated over a network of thousands of different nodes. Although one node will not necessarily store all the data, the data will be spread out countless times over all the nodes in the network to provide redundancy and rapid file access.
As founder Sam Williams of Arweave explains, the permaweb “spreads the data across tens of thousands of places in the world and then makes it available from those locations, like the web, except censorship-resistant and permanent.” Even if one part of the permaweb goes offline, the remaining network retains the memory.
- Storage Endowment. Like everyone else we need to pay someone to store the data. So how can a one-time payment cover the cost of storage for a lifetime or more?
In most areas of life we are used to prices going up. However, this is not the case with the price of storage for data. It is very much the opposite as over the past 50 years the average annual rate of decline to store a GB has been 30.57%.
The decline of storage prices has allowed the Arweave team design an innovate payment method to incentive storage over extremely long periods of time. The one-time up-front fee goes into an endowment where the interest on the fees will accrual perpetually and cover the cost of storage over time. In other words, the amount that a user pays upfront creates enough interest over time to cover the costs associated with paying someone to store that data perpetually.
Just like a university or non-profit forms an endowment that creates interest to cover costs over time, the Arweave token creates interest that covers costs. Unlike those other endowments, the interest is covering costs that are declining and not rising.
This design, in the end, creates a reward for the network (the people storing that data) that is greater than the cost to hold the data and maintain it—even over long periods of time. Even in the unlikely case that storage costs do not go down, the upfront free will cover 200 years of storage.
Want to learn more? Read our post “Can data really be stored forever?”