Filecoin-the core mission of storing the most important information of mankind
A key component of the Filecoin economy is block rewards, which reward storage miners for providing reliable and useful storage capacity and maintaining the Filecoin blockchain. The Filecoin blockchain grows through successive rounds of leader elections. Any miner who wins the leader election and is therefore selected to mine a new block will receive a certain amount of Filecoin tokens as a block reward.
Filecoin's overall reward system is unique, whether it is in determining who wins the collective reward or the incentive method used in the process of obtaining the reward. This improves the usefulness of the Filecoin network to miners and customers and ensures its long-term health.
Miners: Win block rewards by storing data
Miners obtain storage capacity by allocating hard disk space to the Filecoin network through a process called "sealing". Sealing divides the storage space into multiple sectors dedicated to storing data on Filecoin. The more storage departments miners add to the network, The more client data they can store, the more Filecoin they are eligible for.
Miners obtain the right to participate in leader elections by providing storage functions for the network. Block rewards are awarded based on the storage capacity that Filecoin storage miners can provide based on the quality multipliers of different transaction types in their storage. Miners receive an overall reward that is proportional to the quality adjustment ability; miners who contribute 1% of the network's overall quality adjustment ability are expected to receive approximately 1% block rewards over time.
Unlike traditional proof-of-work blockchains that require miners to perform computationally intensive but useless tasks to win block rewards, Filecoin miners earn block rewards by proving that they provide reliable and useful storage for network clients. Anyone can contribute storage resources to the network and immediately start receiving block rewards.
Block rewards greatly encourage miners to store useful data, and cryptoeconomics greatly subsidize the storage of actual customers on the Filecoin network. This incentivizes legitimate use cases and emphasizes Filecoin's core mission of storing humanity's most important information.
Client: Use block rewards to subsidize reliable storage
The Filecoin network aims to provide customers with reliable and useful storage, which requires Filecoin miners to provide continuous storage services to their customers in accordance with the customer's contractual agreement. If Filecoin miners go offline while signing a contract with a customer, it will damage the value of the customer's service and damage the health and reputation of the network.
In order to incentivize miners to provide stable services, the Filecoin network requires miners to use their block rewards as collateral. If the miner terminates the contract prematurely or goes offline, the miner will be punished and the collateral will be referred to as a "substantial reduction."
The Filecoin protocol uses block rewards to not only incentivize miners to store data in the first place, but also to do so in a durable way and honor their promises to customers and the network.
Storage customers have the right to share the products and products of the Filecoin network because they incentivize miners to meet customer needs. It is also in the best interest of storage miners to meet demand and build applications and tools on top of Filecoin to better meet customer needs.
Network: Minting block reward based on network utility
Many blockchains encourage early adoption by applying exponential decay models to the rate at which miners receive block rewards. This means that in the early stages of the blockchain life cycle, participation and utility are usually the lowest, and then rapidly decline, and mining is profitable exponentially. This model encourages storage miners to make excessive investments in hardware as quickly as possible during the closed phase of mining, with almost no consideration of the reliability and practicality of their storage. In addition, this will result in most network subsidies being paid based solely on time rather than on the actual storage (and therefore value) provided to the network.
To encourage consistent storage enablement and long-term storage investment, rather than just rapid sealing, Filecoin introduced the concept of network benchmarks. The concept of "network time" is defined based on the progress made by the network in meeting its benchmarks. Instead of minting tokens based solely on elapsed time, it is better to expand rewards based on elapsed "network time". This preserves the shape of the original exponential decay model, but can soften it in the first few days of network establishment.
The overall result is that Filecoin's rewards for miners are more closely matched with the utility they and the entire network provide to customers.
Specifically, a hybrid exponential casting mechanism is introduced, in which part of the reward comes from simple exponential decay, that is, "simple casting", and the other part comes from the network baseline, that is, "baseline casting". The total reward for each period will be the sum of the two rewards. With this mechanism, mining Filecoin should be more profitable.
Simple casting allocation will reward early miners disproportionately and bring back pressure to the impact. As more value is created for the network, the baseline minting allocation will mint more tokens. When the network can release greater potential, more tokens will be minted to facilitate greater transactions. This will lead to an increase in network value creation and reduce the risk of excessive coinage.
There are many functions that can make passing baselines more efficient and economical, and release more baseline minting. The community can unite to achieve the following goals:
Higher-performance copy proof algorithm, with less chain footprint, faster verification time, cheaper hardware requirements, different security assumptions, so that the service life of the sector is longer, and can be performed without resealing Sector upgrade. A more scalable consensus algorithm that can provide greater throughput and process larger quantities with a shorter termination time. More trading functions enable the industry to last longer.
Finally, it is important to note that although block rewards incentivize participation, they cannot be regarded as resources to be utilized. This is a common subsidy pool that can seed and expand the network to benefit the economy and participants. The following examples illustrate the different stages of the economy and the different sources of subsidies.
Conclusion: Block rewards are one of the many encrypted economic structures that Filecoin uses to fulfill its mission of establishing a reliable and useful storage economy, in which participants convert raw materials into valuable storage-related goods and services . Through a unique block reward structure, the Filecoin protocol aligns the incentives of miners and customers with the long-term utility of the network.