I don't think that would represent a data leak, and you could then dedupe based on md5sums...
downvoters: If I encrypt a plaintext, and you encrypt the same plaintext, we'll have different ciphertexts. If we detect that we encrypted the same plaintext, how do we deduplicate? (Also, I would consider that a leak.)
http://research.microsoft.com/apps/pubs/default.aspx?id=7421... http://www.ssrc.ucsc.edu/Papers/storer-storagess08.pdf
(tldr; there are serious security/privacy vulnerabilities with convergent encryption)
Like Dropbox.
That's correct; there might be a middle ground that's yet to be explored and proved secure.
Check previous discussion here: http://news.ycombinator.com/item?id=2570538
Or is the assumption that with encrypted data you are so incredibly unlikely to see hits that its not worth doing...
Block-level de-duplication can easily work for encrypted data.
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Blocks of data can be treated completely independently of the encryption. The block size is not necessarily the same as the encryption cipher block size (if you're using a block cipher).
Say, a chunk of 4000 different files all have a few disk blocks that contain the same pattern of data. You can store those few blocks once, instead of 4000 times. With encryption, this is still possible, but it's going to be slower, as the data segments will be more randomly distributed. It is still, however, possible and will result in savings.
also on stage at tech crunch disrupt the founders were talking about the majority of the data be deduplicated
The short version of all of this is that Bitcasa can't actually pull off what they are claiming and still maintain any user security/privacy.