Filecoin is a new cryptocurrency that offers a decentralized storage network and incentive scheme. It is a member of the same family as bitcoin and other cryptocurrencies, but with a few essential differences.
The most important of these is that Filecoin’s native token is called “Filecoin.” It’s not an ERC20 token like most other popular cryptocurrencies.
The Ultimate Filecoin Guide: What is Filecoin?
What is Filecoin?
What it does: Filecoin is a new kind of cryptocurrency with a few key differences from most others. It is a sort of de-facto standard for decentralized storage on the blockchain. It uses a “proof of storage,” the algorithm that creates a system that automatically redistributes excess computing power from other tasks to process storage requests.
How Does Filecoin (FIL) Work?
When a file is uploaded to the decentralized storage network, the file’s contents are broken down into smaller chunks. Each user’s computer then effectively “mines” for new chunks by finding the hashes of the stored files on the computer. The user then can either keep the chunk or pass it onto other users in need of storage. The responsibility of storing a file is passed from computer to computer until it has been stored on as many computers as possible.
The total storage available on the network is unlimited, but computing power is not. Computers can offer the excess computing power to the network in “slices” or small parts of a chunk. These slices are then available for other users to use when they need them. This is how Filecoin’s “floating fee” system works.
Filecoin Pros and Cons
- Decentralized: Unlike centralized services, no single organization or company controls Filecoin. This makes it more secure compared to centralized storage services like DropBox or even some torrent trackers. The more people that use Filecoin, the more secure and fast it becomes.
- No fees: There are no costs to store or retrieve files with Filecoin. The more people using FileCoin, the more files are stored, and the less each new and existing file takes up.
- No more viruses: Users don’t need to trust any third-party company with their data.
- Slow at the moment: Filecoin is new and still developing. Although development is ongoing, it’s not quite as fast as some other cryptocurrencies.
- Lacking features: There aren’t too many features currently, and those are the most commonly used ones, such as multi-file storage and OneDrive integration.
What Makes Filecoin (FIL) Unique?
While many cryptocurrencies aim to solve the same or similar problems, few offer anything different or more innovative. Filecoin is different in that it is built with a couple of unique features:
- Decentralized Storage: Just like the name suggests, Filecoin is a cryptocurrency designed to store and transfer files on a decentralized network. This is achieved by using a Proof-of-Storage algorithm that breaks down large files into smaller parts and stores them on multiple computers around the world.
- Decentralized Applications: Filecoin is designed to run decentralized applications or “apps” on it, which are currently scarce but will likely increase in number in the future.
Where to Buy Filecoin (FIL)
You can find out more about the token, where to buy it, and how to purchase it in our step by step guide here:
Where to Store Filecoin (FIL)
You should store your FIL in a wallet that you own the private keys to for security purposes. Some of the most secure are hardware wallets, which can be broken into and used only by pressing a specific button.
What is the Cost of Filecoin (FIL)?
The price of Filecoin has fluctuated a lot recently, and it’s not down to a dip in quality as many people claim. It has changed so much because its market capitalization (the total value of all coins in circulation) is low. At the time of writing, just 7.7 million out of a total circulating supply of 100 million coins have been sold, making it the least popular of the top 5 cryptocurrencies (Ethereum has the highest market cap at $46.2 billion).
Buy right now. Filecoin’s potential is huge, and it’s only going to increase in value as more people use it and discover its numerous benefits.
Bitcoin is a payment system that is run by a peer-to-peer network of computers. This system allows coins to be sent from one computer to another without a trusted third party.
Bitcoin was the first decentralized digital currency, and it is still by far the biggest and most popular decentralized currency. However, many others, such as Ethereum and Litecoin, also offer valuable features and benefits over traditional banking and financial institutions.
The main problem that Bitcoin tries to solve is that there is no central point of control. All transactions are grouped and made public by an address, which can pay to. This address shows all the details of the latest transaction, from the number of coins being sent, to the time it was made, to who made it.
This can use this information to make a transaction verified by other computers on the network, giving the transaction its “confirmed” status. The transaction is then added to the blockchain, a public ledger of all transactions that have ever been made.
Ethereum is a “next-generation” cryptocurrency that builds on the success of Bitcoin but with several key upgrades and additions. The most important of these is the ability to create what are called “smart contracts.” Smart contracts are automated contracts stored on the blockchain and run exactly like traditional software, but they are also completely verified by the network. This makes them highly secure and reliable.
Can create smart contracts for a wide variety of use cases, all of which the community is experimented with. They can also be created to qualify to receive rewards specifically linked to their efficiency. Although the system works similarly to how Skyminers work, many differences set them apart.
For a start, a Skyminers is a dedicated computer created just for mining. While these aren’t completely necessary, they significantly increase mining speeds and are more or less required to compete with traditional miners.
The other main difference is that the Skyndominium directly provides Skyliners. While it is possible to buy a standard PC and use it for mining, the amount of time you will get out of it will be severely hampered by the lack of power and speed that comes with a dedicated machine. Buying a SKYminers is optional, and many users choose to use their PCs for other tasks while they mine.
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Rippe is a payment platform, kind of like PayPal or Venmo that allows you to send and receive money directly from another person without the need for a bank account. It runs on a credit and debit cards system that can be linked to a personal account and then transferred between other users.
Unlike other cryptocurrencies, Rippe operates on a “closed-loop” system. That means that every transaction on the network is monitored and secured by the Ripple foundation. This is different from other cryptocurrencies such as Bitcoin, which uses a system of Peer-To-Peers (P2P) to monitor and ensure all its transactions.
Rippe has a faster confirmation time than most other cryptocurrencies and has a far lower rate of chargeback fraud. This makes it a preferred payment method for merchants looking for a fast, secure, and cost-effective way to receive payment.
While many other cryptocurrencies have a huge spike in popularity every time there is a media frenzy about a new one being hacked, Rippe has had no such issues. This is because the entire system is based on trust. Nobody owns or has access to your personal information. This means that, unlike credit card companies, there are no chargebacks or disputes.
The network offers many other benefits, but those are the key ones. Unlike many other cryptocurrencies, Rippe is not only usable for day-to-day transactions but is also being used by real businesses.
Filecoin FIL is an excellent investment for its long-term potential and userbase. However, it is a much riskier investment and should only be considered if you’re comfortable with the risks involved.
Out of all the coins we covered, Filecoin is the only one with a working product and a team behind it. The others, while having their unique attributes, are simply ideas at this point.