Filecoin (FIL) is one of the largest cryptocurrencies in the world. With the recent expansion of the bull market Filecoin became an attractive digital currency for investors to buy and hold. Nowadays, FIL is trying to enter the top 10 market and offer services to thousands if not millions of users from all around the world.
In this post, we are going to tell you what Filecoin is, how it works and why it is important for the future expansion of the crypto space.
Disclaimer: the information shared by AltSignals and its writers should not be considered financial advice. This is for educational purposes only. We are not responsible for any investment decision you make after reading this post. Never invest more than what you are able to lose. Always contact your professional. financial advisor.
What is Filecoin (FIL)?
Filecoin claims to be a decentralized storage network that is designed to store the most valuable information of the entire planet.
The Problem
At the moment, there are centralized cloud services that spread around the globe. Each of them offers services to a small region in an inefficient and sometimes not secure way. Indeed, this does not allow many users to get access to data in a fast and simple manner.
Moreover, this is also a centralization in terms of services offered by cloud companies. They easily dictate prices in the jurisdictions where they operate. At the same time, they leave without proper solutions to thousands if not millions of users that would like to get access to fast, reliable and cheap storage.
The Solution
Opening an entire market for the whole world could be one of the solutions to the above-mentioned problems and big players dominating the industry. Filecoin wants to connect the world with entirely new storage and economic model, and it does not matter the type of connectivity.
Let’s suppose that a person wants to store data on the Filecoin network. In order to do so the person sends the data to a server and this server stores it. These servers are called miners that must prove they are properly storing the data they have.
In order to do so, the entire network makes sure that the information is stored as it should. This is done using cryptographic proofs. Additionally, miners need to submit their storage proof in blocks to the network.
Searching For Data
The next and logical step is to find the data you need. In order to do so, a person might retrieve files from the network from the fastest or most affordable miner. This is up to the user, who can select and choose the option that suits better to its needs. This ends with the expensive and slow centralized servers.
In this way, the client pays the miner and retrieves the file. Now, we are witnessing a decentralized storage network that is powered by Filecoin. The larger the network, the fastest and cheapest it becomes and other miners can pick it up and store it.
With this economic model, the data spreads where the demand is. If a region requests data, miners would get this data and share it with users that are searching for it in specific regions.
Filecoin Digital Currency
In this way, by using the Filecoin network, we are now ready to enjoy a new type of data storage. At the time of writing, Filecoin is the 14th largest cryptocurrency in the market. This network has a market capitalization of $11.7 billion and a price per FIL token of $180.
The coin was launched during the 2017 Initial Coin Offering (ICO) boom and it then launched in 2020. The platform was already planned in 2014 and it became a reality just a short time ago.
It is worth taking into consideration that the founder of Filecoin is Juan Benet, who created the Interplanetary File System. Thus, the goal to make data available through decentralized networks and connections existed already in the past.
The circulating FIL supply is currently 65 million but the maximum supply is close to 2 billion. Thus, there is still a lot of room for digital currency to grow in the future in terms of market capitalization if the price remains constant.
It is worth mentioning that this coin reached an all-time low of $1.83 just in August 2019. Since that moment, the coin registered a price increase of 9636%, making it one of the largest and most valuable in the market.
