Data Storage in the Blockchain – Bitcoin Stack Exchange

My learning on the blockchain is mainly based on theory. I've always had the impression that the blockchain was about processing and storing data, which makes me confused.

I've always imagined blockchain as a P2P decentralized data storage system where anyone can transfer / download / store anything on the blockchain network. The data can be any matter of value. Any download or transfer of data is encrypted. The data is stored encrypted. There is a magic formula that converts size data into summary data. Anyone who retrieves the digest will be able to restore the original content with the key.

The more I dig in it, the more it seems that I have understood everything wrong.

Data storage

I understand that Bitcoin is not intended for data storage. It can be, but not for. I've read about IPFS.

Now, the data storage part whenever it is mentioned with blockchain technology (not limited to bitcoin), without reference to IPFS or equivalent, do the data generally correspond to digital signature hashes? We store the digital signatures of the data. We do not "upload and save" content like what we do with cloud storage? (Let's assume that the cost of storage is not a problem.)

The recipient is not able to "convert" the summary into original content because the original content is not at all "transfer" / "store" on the blockchain .

If we want to encrypt the data, we will do it "ourselves" using a external service out of the chain. We sign the encrypted data with a private key. The recipient will use our public key to verify the digital signature and the encrypted data it has received. The decryption part must be communicated outside the chain.

Did I understand the above now?


My question is not limited to Bitcoin but blockchain in general.