What is FIL? The Ultimate Guide to Understanding Cryptocurrency: Filecoin

Thursday, September 30, 2021 at 12:21am

Filecoin is a decentralized peer-to-peer network used for storing files using blockchain technology and InterPlanetary File System (IPFS. The system works by allowing users to store their files on a decentralized network in exchange for a fee. This fee is paid with the platform's native FIL tokens. Filecoin’s Mainnet went live in October 2020 after three years of development. Users that offer storage space are called storage miners. Anyone can join the network, whether they want to store files or offer storage.


What is Filecoin

Software development firm Protocol Labs launched Filecoin in October 2016, offering a decentralized storage network powered by the Ethereum blockchain. The company's CEO and protocol designer, Brock Pierce, is also serving as an advisor to Protocol Labs. The platform utilizes the Proof-of-Concept Utility Token (PUCU) as its currency, which allows participants to create storage nodes and sell storage space. Users that store data and files on the platform are called storage miners. Anyone can join the network, whether they want to store files or offer storage. A decentralized blockchain based on Ethereum allows the platform to be built without the need for centralized servers. Such a technology allows for a larger scale network to be created, and reduces the costs of renting storage space.


What are the advantages of Filecoin

The Filecoin network offers the highest decentralization of any storage network. There is no central authority managing the network. The network is completely open and decentralized, requiring no fees to use. Each node has complete autonomy, decentralized storage with no central storage. This makes it the most secure decentralized storage network in the world. Filecoin also has the highest scalability of any storage network. Compared to popular cloud storage options like Dropbox or Amazon S3, there is very little lag time. In fact, some files can be stored in the same network, and accessed by many storage nodes, faster than ever before.


What are the disadvantages of Filecoin

The benefits of using Filecoin are clear, but what are the disadvantages of using the platform? The system has some disadvantages, mainly due to being a recent project. One of these disadvantages is the scarcity of tokens in the exchange. There is a high demand for FIL, the tokens are usually under-sold, and the value of the token can drop significantly. There are also no certain uses for the platform and there are several things that could be improved on the implementation. However, one of the more significant drawbacks of the system is the access to the system by those who don't have wallets. The platform only functions as long as the storage space is paid for and there is a hard cap on the amount of tokens that can be issued in the first year of development.



In conclusion, it is clear that crypto has the potential to have a major impact on the world. Without a doubt, the project of Filecoin is the most exciting one as it is solving one of the major problems plaguing mankind: data. With this blockchain technology, files can be stored and accessed by anyone, anytime. If it works as it should, it can be a game-changer for mankind.