Definition ∞ Centralized storage refers to a system where all data is maintained and managed in a single, distinct location or by a single entity. This model involves a primary server or data center controlling access, security, and integrity of information. Users access data through a network connection to this central point, relying on the managing entity for availability and protection. It stands in contrast to distributed or decentralized storage approaches common in blockchain systems.
Context ∞ In cryptocurrency news, discussions around centralized storage often relate to security vulnerabilities, regulatory control, and points of failure for digital asset platforms. Exchanges or custodial services that rely on centralized storage for user funds or data face scrutiny regarding their resilience against attacks and censorship. The preference for decentralized alternatives within the crypto community stems from a desire to mitigate the risks associated with single points of control and improve data sovereignty.
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