In today’s digital era, cloud storage can easily run out, especially if you have tons of files and data to store. Thankfully, technology on this has greatly improved and the world now has a decentralised way of storing information through Protocol Labs’ Filecoin.
In a nutshell, Filecoin claims to be a decentralised storage network for important pieces of information, as stated on its website. However, there is more than meets the eye when it comes to this advanced technology. If you want to learn more about it along with its Filecoin cryptocurrency, we encourage you to keep on reading!
What is Filecoin?
Filecoin is decentralised storage for ‘humanity’s most important information’. Think of it like cloud storage but instead of having a centralised structure, it lets its users be the custodians of their data, making information easy to retrieve and difficult to censor.
It was founded back in 2017 by a company called Protocol Labs through an Initial Coin Offering or ICO. Though originally slated to launch two years later in mid-2019, it was pushed back another year due to the delay of block 148,888.
The team was led by Juan Benet who’s no stranger to creating advanced tech as proven by his previous work with Interplanetary File System. This system was a P2P network used to store and share information and data within a distributed network which shares some similarities with Filecoin.
Today, Filecoin is one of the leading options that rival different kinds of centralised cloud storage such as Google Drive and iCloud thanks to its decentralised nature that protects each data’s integrity.
How does Filecoin cryptocurrency work?
For Filecoin to work the way it does, the blockchain uses two types of technologies. These are:
This process involves storage miners proving that what they’re storing is a new and unique piece of data. It requires a ‘prover’ to show that they’re using their storage space to store unique copies of data inside the network. They’re able to do this by defending a publicly verifiable claim that they’re truly and accurately using storage space to keep unique data and information.
This plays a huge role in 2 different ways. The first one is it ensures that the data can be retrieved anytime and the second is it shows that a certain space is truly being used to store data and information.
Proof-of-Spacetime involves randomly selected miners to read data and verify if the participants in the network are continually storing unique information and data over a specific time. In return, these miners are incentivised with a specific amount of Filecoin token (FIL) for their honest work.
What is Filecoin Token?
Filecoin or FIL coins are the native tokens used within the network. It’s used to incentivise storage miners for maintaining the network’s integrity as well as keeping the decentralised storage running.
According to Protocol Labs themselves, the native token can also be used to purchase storage space from other users. On top of that, three Filecoin markets are currently in operation. These are:
- File storage
- File retrieval
- On-exchange token trading.
As of the time of writing, the token has a circulating supply of 187 million FIL and a market capitalisation of over 4 and a half million US dollars.
Mining for Filecoin (FIL)
In Filecoin, miners are responsible not only for creating new blocks but for storing files as well. They’re the ones who can grant other users the storage space they need for their important files and data, which is why they’re given a specific amount of FIL after every successful verification.
Moreover, there are different types of miners in the network, all of whom play unique roles on the network. These include:
Storage miners in Filecoin are often dubbed as the heart of this decentralised network and for good reasons. They play pivotal roles in allowing the network to work the way it does. Here are the two most important things that these people do for the network:
- Store data from users around the world
- Verify storage over some time by computing cryptographic proofs.
Once they successfully do their jobs on the network, they’ll be awarded block rewards and transaction fees. However, these rewards won’t be randomised like in other blockchain networks. Instead, the amount they’ll receive will correspond to how much storage space they provided for the network.
One of the most important things about storing data is that people should also be able to retrieve them easily and that’s where retrieval miners come in. These miners ensure fast data retrieval by providing pipes for the network.
Unlike storage miners, they receive a specific amount of FIL when they successfully win a bid that they’ve put on a particular file. This is of course, on top of the mining fees.
Pros of Filecoin
To give crypto investors more reason to buy Filecoin and use its network, the decentralised storage offers a fair share of advantages such as:
More than reliable storage
To ensure that you get the best value for your money, Protocol Labs made sure that the storage is more than reliable by storing data in servers that are always online. This way, you can retrieve any data quickly and easily.
Filecoin ensures that each data stored is verified through a variety of built-in processes. Through these processes, the history of each file can be checked to see and guarantee that it has been stored properly over time.
With Filecoin, you can always ask questions about the network because the community behind it is always active. Among this community are the expert contributors equipped with knowledge about everything you need to know about Filecoin. These people will be more than happy to assist you and any other users, whether they be newcomers or veterans.
Should you invest in Filecoin cryptocurrency?
As with any crypto token in the market, you can never predict the trajectory of Filecoin’s future. However, if you value data and how it’s important to keep its integrity, then this is a great option for you. Moreover, you can also enjoy the useful pros that come with Filecoin such as its active community, verifiable storage and most importantly, decentralised nature.
If you’re looking to invest in Filecoin today, you can do so by visiting some of the famous cryptocurrency exchanges such as Gemini and Kraken.