In the never-ending sea of crypto’s, Filecoin is the next promising star. But is Filecoin an investment as profitable as Bitcoin? FileCoin is an open-source, public cryptocurrency. It intends to be a blockchain-based digital storage and data retrieval which makes this coin a bit more interesting to learn about. Filecoin is the incentive layer of the IPFS (Interplanetary file system). IPFS makes it possible to host web content in a decentralized manner across multiple computers. Could this be the future, and change how we look at data storage as we know it?
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What is FileCoin? (FIL)
Filecoin is created by Protocol Labs and built on the Interplanetary file system. It tries to build an economy around the storage and it allows users to rent out unused hard drive space. Its aim is to store humanity’s most important information. A lofty goal but one it has been working towards since its inception in 2014, and detailed in their mid-2017 white paper “Filecoin: a decentralized storage network”. Economic incentives and disincentives are baked into the blockchain to produce the optimal number of storage and retrieval miners. The Filecoin (FIL) supply stays at 2 billion. The current adoption rate seems to mitigate the potential for high inflation of FIL tokens.
A Brief Look at How FileCoin Works
Filecoin and IPFS are just two of the protocols of protocol labs in their mission to create a new decentralized internet. FIL is native to the Filecoin Blockchain. The Filecoin Blockchain handles all transactions related to storing data, specifically the agreements between clients who are looking to store data and storage miners who store that data on the IPFS for a small fee paid in FIL coin.
To ensure storage miners keep their end of the bargain, they must write proof to the Filecoin blockchain that they are storing the data whenever a data deal is done. This is what we call Proof of Replication (PoR).
After submitting the initial proof, storage miners need to submit additional proof that they are still storing the data in question. This is what we call Proof of Space-time (PoST).
If a storage miner fails to submit the initial proof or any follow-up proofs of data storage some of the FIL coins they state to participate on the Filecoin Network are slashed. In addition to fees from storage deals, storage miners earn block rewards proportional to how much hard drive space they’ve committed to the Filecoin Network. When a client wants to receive a file from Filecoin, they pay a small fee to a retrieval miner who fetches the file.
Filecoin (FIL) Price History and Filecoin (FIL) Prediction
On June 22nd, the live Filecoin (FIL) is $50.06 USD, down from its monthly high of $97.09 USD. Some are calling it a crash. The experienced trader knows that all markets go through corrections. This one is no different as it has affected all coins regardless of project goals or market caps.
At the time of writing the market cap for Filecoin stands at $4,059,747,818. At one point it had reached $12.3 Billion. Additionally, it has a high of $237.24 USD during just the past 52 weeks-high and a low of $9.16 USD. Anyone can see the potential of this great project to rebound to the 52-week high price range and possibly even surpass it. Although the crypto markets are experiencing a correction, it is the best thing an investor can see. Because, these are perfect opportunities to dollar cost average, with which you can lower your cost basis, and increase your positions. The Filecoin(FIL) price prediction is in the $300-500.00 USD range.
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Conclusion: Is Filecoin a Good Investment?
This remains to be the million-dollar question for all cryptocurrencies, no matter the project behind it. As with all investments, a good amount of due diligence is necessary to make the right choice. The need for a reliable, decentralized database will grow as time passes. Filecoin looks to be one to keep an eye on.
So is Filecoin a good investment? Yes. At its current price, it seems to be a good buy for new investors. Now presents a great opportunity to accumulate more for existing hodlers. Many analysts have given the Filecoin core team high ratings in regards to their work, which gives us a very bullish sentiment on the project. However, it may still take a long time for it to gain mass adoption. But the project is currently showing good ecosystem development progress.