A system that facilitates intelligent allocation of backup data among a set of storage locations in a hybrid backup environment, comprising: a processor coupled to a memory that retains computer-executable instructions, the processor executes: a monitor component that identifies properties of backup data stored by one or more cloud storage locations and one or more peer-to-peer storage locations and properties of the one or more cloud storage locations and of the one or more peer-to-peer storage locations; and a tier component that implements virtual layers of backup data across the one or more cloud storage locations and of the one or more peer-to-peer storage locations, the one or more cloud storage locations being remote from the one or more peer-to-peer storage locations, in accordance with the properties of the backup data and the properties of the cloud storage locations and the one or more peer-to-peer storage locations, wherein the the tier component includes a distribution component, wherein the distribution component utilizes access frequencies and ages of blocks of backup data to designate blocks as hot or cold, wherein hot data refers to blocks of backup data that are frequently accessed and/or recently created while cold data refers to data that is infrequently accessed and/or created a long time ago, wherein the distribution component allocates hot data to storage locations that provide optimal locality to a possible restoring machine and allocates cold data to storage locations with less optimal locality but cheaper, abundant storage, and wherein the distribution component replicates blocks of backup data to the one or more storage locations based at least in part on the properties of the backup data or the storage locations. a monitor component that identifies properties of backup data stored by one or more cloud storage locations and one or more peer-to-peer storage locations and properties of the one or more cloud storage locations and of the one or more peer-to-peer storage locations; and a tier component that implements virtual layers of backup data across the one or more cloud storage locations and of the one or more peer-to-peer storage locations, the one or more cloud storage locations being remote from the one or more peer-to-peer storage locations, in accordance with the properties of the backup data and the properties of the cloud storage locations and the one or more peer-to-peer storage locations, wherein the the tier component includes a distribution component, wherein the distribution component utilizes access frequencies and ages of blocks of backup data to designate blocks as hot or cold, wherein hot data refers to blocks of backup data that are frequently accessed and/or recently created while cold data refers to data that is infrequently accessed and/or created a long time ago, wherein the distribution component allocates hot data to storage locations that provide optimal locality to a possible restoring machine and allocates cold data to storage locations with less optimal locality but cheaper, abundant storage, and wherein the distribution component replicates blocks of backup data to the one or more storage locations based at least in part on the properties of the backup data or the storage locations.