v. On-Chain vs Off-Chain Data

On-chain and off-chain data describe where information is stored and processed in relation to blockchain systems. This distinction affects scalability, cost, privacy, and how real-world information is referenced, verified, and enforced within tokenized structures.

Data Availability

The extent to which data can be accessed and retrieved when needed.

Data Reference

A pointer or identifier stored on-chain that links to off-chain information.

Hybrid Architecture

A system design that combines on-chain records with off-chain data storage.

Off-Chain Data

Information stored outside the blockchain, such as documents, models, or databases.

On-Chain Data

Information stored directly on the blockchain ledger.

Oracle

A mechanism that delivers external data to a blockchain for use in smart contracts.

Privacy Constraint

Limitations on what data can be stored or exposed due to confidentiality or regulation.

Scalability Constraint

Technical limits affecting how much data can be stored or processed on-chain.

Storage Cost

The economic cost associated with persisting data on a blockchain network.

Verification Anchor

An on-chain record used to verify the integrity or existence of off-chain data.