The block height of the Filecoin testnet reached 147888, which means that the mainnet will be launched soon, and the mainnet that has been waiting for more than three years will finally come online.
First we have to understand what Filecoin is
When it comes to Filecoin, IPFS cannot be bypassed. It is a content-addressed network. The birth of IPFS aims to replace the traditional current HTTP network. Filecoin is the incentive layer of ipfs and a decentralized storage network. To realize the vision of ipfs, a decentralized and variable storage market like Filecoin is needed. In addition, from the perspective of Web3.0, such a decentralized storage market is also very important. V| jasonbody
In this network, users pay fees to miners for services. The storage miners run software and hardware and get paid, but they are just token revenue. Filecoin's blockchain records FIL token transactions and also records storage proofs of storage miners.
The market where Filecoin is based
Therefore, Filecoin will be based on at least two markets : cloud storage and CDN (content delivery network) services. According to data in 2019, the output value of cloud storage exceeded US$46 billion, and CDN services also exceeded US$12 billion. And it is well known that both of these markets continue to grow rapidly.
Currently, these two markets are monopolized by centralized giants, which corresponds to the dominant position of centralized services. However, with the development of Dapp, decentralized applications will be more willing to use decentralized storage facilities, so the situation will gradually ease, but for a longer time.
Unlike other cloud storage and CDN services, Filecoin provides services in a decentralized manner, which means that it does not rely on trusted third parties to provide services. This also means that it needs verifiable storage, participation without permission, etc.
Therefore, Filecoin needs a blockchain, and encryption verification is needed to verify whether the user's data is being stored, that is, storage proof. At the same time, it needs to pay and subsidize through native tokens to incentivize miners to provide storage services for more people. Participation without permission means that anyone can become a storage service provider on the Filecoin network, as long as they have certain hardware equipment and Internet access.
In addition, since the participants are also distributed, it may also develop into a more effective CDN service. Therefore, Filecoin will not only enter the territory of AWS, but also the territory of CloudFlare (CDN service). Files that are close to the user will be faster, especially the popular content will have an advantage, and even institutions can participate in mining to provide data retrieval services for close users.
Sustainable design of Filecoin token economy
Token design in the crypto economy is very important, which is very important for the life of the project. Filecoin's token economy is designed to serve decentralized storage market participants. It is necessary to provide participants with a more reasonable token incentive mechanism, to reduce their short-term behavior as much as possible, and to contribute to the sustainable development of the network.
In Filecoin's network, storage users pay FIL to store tokens, and miners obtain tokens by providing storage space. The storage process is supervised by the network. The search market is also similar.
But a prosperous market requires a larger scale of usage scenarios, and the value of Filecoin comes from this. But the larger the market, Filecoin's token generation speed must match its value creation speed, otherwise it is not conducive to overall development. Filecoin needs to form an economy that encourages real transaction demand and can still operate without FIL subsidies.
Filecoin's storage service provider
In the decentralized storage service market, free transactions can be realized without the involvement of a third party. For this reason, Filecoin has done a lot of transactions, including committed capacity, sectors, and miner pledges.
At present, Filecoin miners need to pledge tokens to participate in mining, including storage pledge, consensus pledge and block reward pledge.
Storage pledge means that miners need to pledge a certain amount of FIL tokens for each sector. Its main purpose is to ensure the quality of network storage services to deal with sector failures and fines.
The consensus pledge depends on the sector's weighted byte computing power and the FIL supply in network circulation. When the network reaches or exceeds the baseline (specially described below), approximately 30% of the FIL circulating supply is locked in the initial consensus pledge.
Finally, the agreement also requires the storage provider to have a minimum pledge to guarantee the minimum storage. If the transaction order is terminated early, this part of the pledge will be punished. The pledge will be returned to the storage provider after the sector’s transaction order is successful.
Filecoin storage users
It is relatively simple for users to obtain storage services on the Filecoin network. The user obtains Filecoin tokens, then finds miners through the network, and reaches an agreement, after paying the fee, the files are handed over to the miners for storage.
Network baseline adjusts token distribution
The total number of FIL tokens of Filecoin is 2 billion. In the distribution of the genesis block, 10% of it is allocated to early investors (7.5% has been sold, 2.5% is retained), 20% is allocated to the project party (15% is allocated to the protocol laboratory, 5% is allocated to the Filecoin fund meeting).
The remaining 70% is allocated to Filecoin's storage miners, retrieval miners, and maintenance miners, etc., subsidizing miners to provide data storage services, maintain the blockchain, distribute data, run contracts, etc. Among them, storage miners have the highest reward ratio, receiving 55% of the token distribution, because they are not only responsible for providing storage services, but also for maintaining core functions. This part of the rewards are distributed through block rewards, which are used to reward the maintenance of the blockchain, running contracts, and storage services. And search miners, maintenance miners, etc. can get 15% token incentives.
Unlike Bitcoin, Filecoin introduces a hybrid coinage mechanism, which involves the concept of network baselines. If the early rewards are too high, the storage miners will encapsulate storage mining as soon as possible, invest a lot of hardware, and withdraw after receiving the early high rewards. This will result in the loss of storage users and also affect its long-term sustainability. In this case, users are not willing to come to the Filecoin network for storage, and miners are not willing to provide long-term services.
Therefore, the completely time-based token release cannot work on the Filecoin network. It must consider the storage computing power on the network, consider the basic utility and value of the network, and generate corresponding block rewards accordingly.
So Filecoin introduced the concept of network baseline. If the network reaches the baseline, its token release follows an exponential decay model. If the network baseline is not reached, part of the block reward will be delayed. Filecoin's hybrid index casting mechanism, part of the reward comes from exponential decay casting, and part from the benchmark casting of the network benchmark. The reward for each time period is the sum of the two rewards.
Among them, 30% is allocated through simple casting, and 70% is allocated based on casting. On the one hand, it can provide the most basic incentives, while the baseline tries to match the basic business scale. Filecoin's network baseline starts from 1EiB (less than 0.01% of global storage), and grows at a rate of 200% every year (world storage is growing at an annual rate of 40%). When the storage provided by the network is about 1% of global storage -10%, the community can decide to slow the growth rate. However, according to the latest announcement, Filecoin increased the initial value of its baseline and reduced the rate in order to achieve more lasting economic incentives.
If you want to release more token shares from benchmark minting, the community can make improvements in copy proof, consensus algorithms, and transaction order markets. The performance of the copy proof algorithm is higher, the data on the chain is less, the verification time is faster, the hardware cost is lower, the life cycle of the sector is longer, and the sector can be upgraded without repackaging; the consensus algorithm is more scalable High, provides greater throughput, can process more messages in a shorter time; sector transaction orders last longer, etc.