The most easy-to-understand interpretation of Filecoin mining: market value will develop rapidly

So far, many miners still don’t know much about the Filecoin mining model. So today I want to tell you what IPFS is and how Filecoin is mined.

The Internet is very developed, and there are a lot of articles explaining the IPFS/Filecoin network, but there is still no easy-to-understand way to explain those technical terms. For those who understand, it is actually very simple to understand, but for those who are new to the circle, the Filecoin mining model is still in a state of confusion. In fact, the logic of Filecoin mining and Didi taxi has been mentioned before, but many newbies don’t understand it.

Therefore, I will once again use the Didi Taxi model as an example and make a detailed analysis and explanation. Those who understand can skip it, but if you are new to it, please read it carefully. When you participate in a project, you must understand the logic clearly, which is the most important thing for you.

IPFS

What is the difference between Filecoin mining and Didi taxi model?

In fact, the Filecoin mining model is very similar to Didi Chuxing. For example, when we place an order with the Didi Taxi app, many drivers will come to grab the orders. The more orders the drivers grab, the more money they earn. So it is the same with Filecoin mining. When a user initiates a storage request on the Fil network, more miners will come to grab the orders. Users pay through FIL tokens, and storage miners will get FIL rewards. In other words, when a user initiates a storage request on the FIL network, he will get more FIL.

Here , Didi drivers can be regarded as "Filecoin" miners, passengers can be regarded as "IPFS distributed storage" users, and the "Didi" system can be regarded as the "Filecoin" network.

IPFS

How to profit from it?

In Didi Taxi, many car owners will drive their cars out to provide taxi services. Passengers submit orders for taxis, and car owners can grab orders on the Didi platform. Passengers can get service rewards after paying. Similarly, in Filecoin mining, everyone shares their idle hard disk storage space to provide network storage services for users. Users pay FIL, and miners get FIL rewards by providing storage or retrieval services.

What is the difference between these two operating modes?

Although the operating models have similarities, there are essential differences. The main difference is that after the Didi Chuxing market matures, the company makes profits by charging agency fees, while the Filecoin system allows the market to operate freely through listed transactions, and the value of Filecoin is determined by market supply and demand.

In addition, why do the project parties repeatedly emphasize that the purpose of Filecoin is to ensure high-quality services and prevent serious data loss? Filecoin miners not only need to provide collateral for the promised storage services, but also must participate in the long term to obtain linearly released block rewards. The collateral is to prevent cheating and maintain network security, while the linear release is for the long-term value of FIL.

The value of Filecoin lies in its ecological construction, that is, providing efficient data storage, officially designed mortgage mechanism, release mechanism, baseline, etc. for global users, which were originally designed for the long-term development of Filecoin. Just like Didi Taxi, no one believed in it at the beginning, so it could only let others ride for free, and some drivers even drove empty cars to gain credit points. After everyone enjoyed this convenient and fast service, the consensus was high, and its market value developed rapidly.

Filecoin mining is to provide storage and retrieval services. Hard disks that do not provide services are equivalent to being idle, just like Didi drivers who do not accept orders and do not receive any rewards. To get more rewards, you must find users, provide better services, and maintain a good reputation, so that you have more chances to successfully grab orders. Juan said that the demand for data storage will increase threefold in the future. He advocates that the community find storage customer services, build applications, and consider long-term development.