What sets it apart from Storj or Siacoin?
What is Filecoin? How is it Different From Storj or Siacoin? Filecoin is a decentralized peer-to-peer cloud data storage and retrieval network built by Protocol Labs with the objective to “store humanity’s most critical information.” It was first introduced in August 2017.
We’re living in an exciting transitional time wherein the Internet is slowly shifting to its next evolution, primarily geared towards a more decentralized user experience. Cryptocurrencies, NFTs, and other blockchain technologies are just the beginning of what we’re starting to see emerge in this new Web3 frontier. It’s important to note, however, that all of these advancements generate massive amounts of data, and as technology continues to evolve, so shall the demands of global data storage. There are a handful of organizations that recognize this and have worked to help create the infrastructure required to handle the future Internet’s needs. Enter decentralized cloud storage services. In this article, we’ll be highlighting the popular Filecoin network, and how it differs to two of its competitors, Storj and Sia.
What is Filecoin?
Originally announced in August 2017, Filecoin is a decentralized peer-to-peer cloud data storage and retrieval network created by Protocol Labs with the mission to “store humanity’s most important information”. It was built atop the lab’s existing free-to-use Interplanetary File System (IPFS), and its mainnet went live in October 2020. Utilizing blockchain technology, clients looking to store their files enter contract agreements with miners who contribute their unused hard drive storage space to the network. The clients pay these miners in the chain’s native cryptocurrency FIL, of which there will only ever be 2 billion tokens. The all-time high price for FIL reached $237.24 on April 1, 2021.
What is Filecoin and how does it work? What sets it apart from Storj or Siacoin?
What sets it apart from Storj or Siacoin?
The Filecoin network uses the Proof-of-Replication and Proof-of-Spacetime mechanisms to confirm that each storage provider is in fact storing copies of the files that they agreed to store in the agreements with their clients. There are two types of miners in the Filecoin network: storage miners who earn FIL by storing data for clients and computing cryptographic proofs to verify storage across time, and retrieval miners who earn FIL by winning bids and mining fees for a particular file, which are determined by the market value of the file’s size. The prices for storing and retrieving files are set by the supply and demand of the market, making it highly competitive.
What is Siacoin?
Siacoin (SC) is the native utility token of the Sia blockchain, which was launched in June 2015 by Skynet Labs. Similar to Filecoin, it also uses blockchain technology to provide a decentralized peer-to-peer storage platform. Users wishing to store their files pay storage hosts in SC tokens, and the files stored through Sia are broken down into small pieces and encrypted so that data is securely spread throughout different hard drives on the network. One of Sia’s long-term goals outlined in its whitepaper is to directly compete with current cloud storage giants Amazon, Google, and Microsoft.
Unlike Filecoin, Siacoin is mined via Proof-of-Work (PoW) mechanisms, just as Bitcoin is. However, this means one must have a powerful mining machine to successfully mine it alone. Siacoin has an unlimited supply and is not capped to any hard limit, making it an inflationary token. Siacoin’s all-time high price reached $0.1117 on January 6, 2018.
What is Storj?
Storj (pronounced “storage”) is yet another decentralized peer-to-peer global cloud network for data storage that was launched in late 2018. Its network utilizes a series of nodes, satellites, uplinks, and the Proof of Storage mechanism to store, retrieve, and verify the storage of files. Similar to Sia (and unlike Filecoin), files are broken down, encrypted, and distributed to various computers on the Storj platform in a process called sharding. In a notable difference from Filecoin and Siacoin, Storj’s STORJ token used for payments and rewards is an ERC-20 utility token, meaning it was built atop the Ethereum blockchain and cannot be mined. There is a max supply of 425 million STORJ tokens, and its all-time high price reached $3.91 on March 28, 2021.
It’s estimated that in 2021, humans generate 1.145 trillion MB of data every single day. This number is likely to grow in time as existing technology continues to improve and more devices are connected to the Internet of things (IoT). All this data has to be stored somewhere, and decentralized cloud storage systems are looking to be an intuitive and secure solution for the increasing data needs of our evolving world.
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