What’s next for Filecoin: economic model discussion?

The following article was written on August 23, 2020, 5 days ago. At the time of writing, the interpretation of the economic model had not yet been released, and some of the statements in the article do not necessarily reflect the latest situation.

However, this article is not an interpretation of the economic model, but mainly focuses on the angles and directions of consideration. Therefore, it can still be used as a reference. It provides some ideas for everyone to interpret the economic model. It is always a good thing for a good model to be introduced after a lot of discussion and consultation. It is also easier to be accepted and understood by embracing the trade-offs of the interests of all parties. Therefore, it is still meaningful to launch this article at this time.

What to do after the development network ends? Go to the test network

What to do when the test network is stable? Calibration

What to do after receiving and dispatching orders? Space Race

Has the Space Race started? Get the economic model right

Is the economic model ready? Ready to launch on the mainnet

Oh, what else? How do I verify a customer?

Project developer (Protocol Labs) : The purpose of Filecoin is to build a storage market; the value of Filecoin lies in how much value it brings to the world. Storing real data and carrying human civilization is the meaning of the existence of this chain. We hope that the Filecoin network can incentivize low-cost real data storage and hope that the Filecoin network will grow rapidly. But this should be measured mainly by the amount of real data stored. When the demand for data storage is insufficient, rapid expansion of the network may not be a good choice; the design will take more considerations into account the security of the network and storage.

Miner (network maintainer) : Filecoin is a promising blockchain project, and my investment can bring considerable returns. Like other investments, I hope that Filecoin can bring timely returns and make profits as soon as possible. The initial investment and long-term capital occupation are both costs. The longer the investment time of a project, the higher the risk factor. The return should be proportional to the investment and risk. What I care about is: when can I make a profit, when can I get my investment back, and how high the rate of return is.

Early investors (iC0, angel investors) : I have invested for three years, and I can basically withdraw in traditional fields, but this is blockchain. Long-term capital occupation makes me lose a lot of flexibility, so if the return is reasonable, I can withdraw through various channels. Mortgage is a good idea, and scarcity is good news.

Potential investors (Hodlers) : We are all Hodlers, participating in the construction of the ecosystem, and it would be best if the price keeps rising. What will drive the price increase? The Filecoin network will continue to develop, continuously develop new features, and enhance the network's functionality, security, and processing capabilities; more importantly, the ecosystem will continue to grow and truly become part of the next-generation network infrastructure platform.

Developers and customers : Filecoin storage users and network builders. Why use the Filecoin network? First, it is cheap and good quality compared to traditional storage; second, it is because others do not have it, and we have it, opening up a new world of storage.

Each has its own focus, which may look different in the short term, but in the long run, the goals are the same. Only when the Filecoin network develops well and the network value grows, all ecological participants are early investors and can obtain objective returns.

One question is: how to balance the long-term and the short-term.

After the reward network (large miner) test is launched, an important thing during the test period is the finalization and discussion of the economic model. The Protocol Labs Economic Model Research Team will release the design specifications as planned. This has been made clear in Slack.

The economic model is very important and has a great impact on the development of the network. All stakeholders should pay attention to it and conduct deductions and simulations.

A model is just a model after all, and it is best to test how it actually works.

We hope that the economic model can truly achieve the following goals:

• Such an economic model can truly promote the development of Filecoin and gradually realize the ideal of Filecoin.

• Due to the reasonable design of the economic model, the operation of the Filecoin network can run smoothly and automatically without the intervention of individuals and organizations, and develop naturally with the rational power of each participant.

• The incentive mechanism reflected in the economic model can attract more and more people to actively participate, rather than being afraid to move forward or even leaving.