IPFS 101 and Filecoin
Filecoin is a blockchain protocol and cryptocurrency incentive token based on IPFS technology with the goal of creating a peer-to-peer decentralized data storage and retrieval network. Created in October 2020, there will only ever be a total of 2 billion tokens released over its life. The coin symbol for Filecoin is FIL. FIL is a digital currency, available as an incentive token to encourage users to participate in the Filecoin network. Its value fluctuates like any other cryptocurrency token, having reached an all-time-high of $237.73 on March 31, 2021. The smallest and most common denomination of FIL is the attoFIL (10^-18 FIL).
Distribution-wise, Filecoin has allocated 70% of the total FIL token supply to miners for providing data storage service, maintaining the blockchain, distributing data, running contracts, and more.
15% are allocated to their founding company Protocol Labs for research, engineering, deployment, business development, marketing, distribution, and more.
10% are allocated to investors for funding network development, business development, partnerships, support, and more. The remaining 5% is allocated to the independent Filecoin Foundation for long-term network governance, partner support, academic grants, public works, community building, and other projects.
IPFS stands for Inter-Planetary File System. It’s a data storage and file-accessing protocol based on blockchain technology developed by Protocol Labs founder and CEO Juan Banet. IPFS is a peer-to-peer network for storing and accessing files, websites, applications, and data in a distributed file system. It aims to create a faster, safer, and censorship-free Internet. The Filecoin network allows anyone to become a data storage provider. Filecoin’s IPFS content addressing and encrypted storage enables data to be stored securely and accessed quickly, creating a powerful and reliable service.
To learn more, visit: IPFS.IO/.
How are Filecoin and IPFS connected?
Filecoin and IPFS are two complementary data systems, both created by Protocol Labs.
IPFS enables peers to store, request, and transfer data, while Filecoin is designed to create a network of ever-increasing data storage.
Filecoin is structured so that data-storage clients pay Filecoin (FIL) to store data. Filecoin miners earn payments and rewards (tokens) by continuously creating data storage capacity and cryptographically proving it.
In short: IPFS is a decentralized data storage system that uses content to improve search results, while Filecoin is a blockchain protocol designed to create decentralized data storage.
Why is Filecoin working to create additional data storage?
It’s estimated that the world’s population creates around 1.145 trillion MB (megabytes) of data per day. As society relies more and more on digital data to work, study, socialize, and shop – especially with the emergence of 5G and other technologies such as the Internet of things (IoT) – data storage needs are expected to increase exponentially. Currently, Amazon Web Services (AWS) owns 32% of the world’s cloud storage market, while Microsoft Azure has 19%, meaning that 51% of the world’s data storage is held on the servers of two companies. Having so much of the world’s data on centralized servers leaves the potential for more server outages and data hacks that are becoming more common today. Filecoin is working to create an unlimited number of cloud providers and developers who provide robust and reliable data storage. Filecoin’s peer-to-peer network is much more efficient and secure than centralized servers that are under corporate control.
Filecoin’s network also achieves staggering economies of scale by allowing anyone to participate as a storage provider and compete for cloud storage business.
Relationship between Filecoin and IPFS 101 Info
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