Three types of distributed system designers
Paranoid privacy nuts. Systems designed by these people never become popular because paranoid people don't have any friends. (Examples: ZKS, Freenet, GPG.)
Redundancy leeches. These people want to back up their files (encrypted) to your computer for added redundancy. Unfortunately, you gain nothing by doing this for them; there's no way to force a leech to contribute space back to other leeches. So these tend to end up as for-profit services. (Examples: AllMyData, Dropbox, S3.)
Sharers. These people have data they want to share with other people. They benefit by giving you the data; you benefit by receiving the data, and if you like it, you'll feel nice by sharing it further. (Examples: Debian, Wikipedia, BitTorrent.)
(Free) distributed storage systems in groups 1 and 2 don't seem to ever succeed, because there's no network growth effect.
Systems in group 3 succeed regularly. And they don't need encryption.