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What is Filecoin (FIL) and how does it work?

by Financial Economy

Filecoin is a decentralized storage network that allows anyone to rent storage space. Likewise, it is possible to purchase storage space on the network. It becomes possible to divide important data rather than entrust it to a single company and store it on different computers around the world. Information about what is Filecoin (FIL) and how does it work is in rest of the article. Information about Ethereum, you can browse here.

What is Filecoin (FIL) and how does it work?

Filecoin was introduced in 2014 when Juan Benet published the whitepaper “A File Storage Network Powered by Crypto currencies”. This proposal is a blockchain network similar to Bitcoin, except that nodes in the network can store data with the guarantee of the proof of retrievability element. Filecoin was developed by Protocol Labs.

Filecoin is sometimes referred to as an incentive layer on IPFS. This means that users are encouraged to rent storage space to receive payments with FIL tokens. IFPS is a peer-to-peer data storage and data access protocol developed using a more decentralized approach. Unlike HTTP and HTTPS, it does not use central servers to store data.

Filecoin collected 250 million USD in its ICO in 2017, which is a record value at the time. Filecoin main network was launched in October 2020. Filecoin’s infrastructure is a distributed, peer-to-peer network whose primary purpose is to offer organizations and individuals a new way to store data around the world. People with unused storage become storage miners, and the miners’ primary responsibility is to store data on the Filecoin network. Customers pay with FIL tokens to both store and retrieve data.

Filecoin advantages!

Access to data miners are another class of participants. As you can imagine, these individuals manage the data retrieval process between customers and storage miners and receive a small FIL payment for their services. Filecoin uses end-to-end encryption and storage providers do not have access to encrypted keys. Since a distributed system is used, files are kept safe by being stored in many different locations.

Filecoin provides a peer-to-peer cloud storage solution for businesses and consumers. Since the same service (storage) can be offered at different prices by different vendors, it can ultimately be a profitable customer. Sometimes you do not have enough space for all your data, sometimes you may remain free and you can sell this area if you want. This is the advantage Filecoin promises.

For details: https://en.wikipedia.org/wiki/Filecoin

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