The Steem Blockchain is itself a database and a full copy of it is stored on every witness's machine. The developer can choose to access whichever part of that database they choose and display it or not. I could, for example, create a note-taking application that encrypted my notes, stored them on the blockchain, and then when I signed into the application I would only see the notes I uploaded in their decrypted form. I would be seeing only my data and no one else would be able to see it except in an encrypted form.
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