Decentralized storage competes on the same stage, what makes Filecoin support the future?

Compared with the slow progress in the past two years, Filecoin has made substantial progress this year. The public roadmap shows that Filecoin has entered the final stage of the second phase of the test network, which means that the countdown to the main network launch has begun.

200+ reports submitted, 25PB storage, 1350 cumulative OSS contributions... Various data show that the enthusiasm for participating in Filecoin is growing. The maximum reward of 4 million FIL, and the additional reward of 100,000 FIL that the top 20 can share, have made the competition among the parties more intense, and further stimulated the vigorous development of the entire market.

Under the bustle, crises and difficulties are often hidden. Past experience tells us that people are always easily immersed in the "charm" of new technologies, while ignoring that the technology itself cannot directly meet business needs and is difficult to form a moat. However, when we look back at the history, we will find that from the steam age to the electrical age, and then to the information age, the process of technology landing has almost played out the same script, first praise, then kill, and then develop.

Will Filecoin/IPFS be an exception? You know, innovation will never be “put away in pockets”.

With the rapid development of the global information industry, data has exploded. According to an IDC report, by 2020, the annual data volume will reach 44ZB (trillion GB), with a five-year compound annual growth rate of 141%. Centralized storage is beginning to be unable to meet the data storage and access needs of different corners.

At the same time, the situation of privacy data leakage is becoming increasingly serious. According to Juniper Research, a well-known data market research organization, by 2019, the rapid digitization of consumer life and corporate records will increase the global data leakage cost to 2.1 trillion US dollars, which is almost four times the estimated data leakage cost in 2015.

It is obvious that problems such as high maintenance costs, low security, and privacy leaks have caused the reliability of centralized storage, which was once popular for its efficiency and high commercial applicability, to reach its ceiling.

Therefore, the emergence and development of decentralized storage is an inevitable process of technological development. In the current Internet environment, decentralized storage has the advantages of reducing costs, enhancing security, and revitalizing the market, which can fundamentally solve traditional storage problems such as data leakage and service restrictions. At present, many decentralized storage projects with different positioning and strong technical competitiveness have emerged in the global market, and are being promoted in full swing. Among them, the popular Filecoin has stolen the limelight, like a splash of water in the desert, attracting people from all walks of life to rush in.

However, as a long-term business track, decentralized storage requires different projects to explore different directions. So far, many projects have made breakthroughs in technology, and their business models are gradually becoming clearer. It can be said that this year is a critical year for decentralized storage.

To this end, PANews takes six projects, Filecoin, Storj, Sia, Arweave, PPIO and Lambda, as examples, trying to build a more complete industry awareness map for everyone.

PANews noted that among the above five projects, Sia is one of the earlier projects that can make cloud storage safer, faster and lower cost. It is understood that Sia encrypts and distributes files through a distributed network, allowing users to manage their data privacy through private keys. This distributed storage solution greatly increases the scalability and privacy of data and reduces transaction costs. It should be noted that the current mainstream centralized cloud storage providers are much higher than this figure, such as Apple needs $22/T per month. However, since Sia uses the PoW consensus mechanism, it will not only consume a lot of computing power and electricity, but also has the problem of double-spending attacks.

However, Sia has already updated three versions, and each upgrade will bring new technological breakthroughs. Perhaps Storj will represent another practical solution.

Storj is a smart contract platform for financial applications. It has high security and low cost through data segmentation and distributed storage. Theoretically, the more nodes there are, the stronger the security. In addition, Storj has stronger privacy, and it is amazing that it was implemented within just half a year of its launch. However, since Storj does not have its own chain, it can only rely on the Ethereum network to pay for gas fees, so once congestion occurs, it will be very difficult to implement commercially and the user experience will be poor.

Arweave has made up for the market demand to a certain extent, which has made Arweave, which focuses on the concept of "pay once, store permanently, and never lose changes", favored by top institutions such as a16z. Through the storage solution of the permanent network, the project uses the tamper-proof nature of the blockchain to directly write the content into the block for storage to achieve the so-called permanent storage function. At present, Arweave's product has been developed and is compatible with IPFS. Developers built on IPFS can seamlessly transition to Arweave. With the advent of the Filecoin mainnet, it may make it a presence in the online boom. However, Arweave's high cost, small number of nodes, and narrow actual application scenarios have put a question mark on its prospects.

Similar to Filecoin, PPIO also uses two more rigorous algorithms, PoRep (Proof of Replication) and PoSt (Proof of Spacetime). Filecoin is the originator of this hybrid consensus mechanism. In the Filecoin white paper, the processes of these two proof algorithms account for more than 70% of the entire text. However, PPIO also created PoD (Proof of Download), which is mainly used to prove multi-point data downloads. Unfortunately, PANews learned that PPIO has transformed into cloud computing.

Whether it is the total amount of financing or the valuation, Filecoin is the leader. In the eyes of the outside world, Filecoin has the opportunity to become a giant value capturer. "The field where Filecoin is located is the 'land and house of blockchain'. The data 'life' on the blockchain needs a place to settle down, which requires the support of these 'land and house'. In other words, the distributed storage represented by Filecoin belongs to the infrastructure of the blockchain and is the carrier of the 'data life' of the blockchain." Blue Fox once pointed out.

Currently, the Filecoin project is huge, with sufficient funds and a complete ecosystem. Once implemented, it will quickly make up for the shortcomings of the centralized storage market. However, its mining hardware requirements are high, and the hardware operation and maintenance capabilities are even higher, which cannot guarantee the participation of ordinary users.

Lambda is very similar to the system structure of IPFS+Filecoin. It also builds its system through the storage network + blockchain incentive network. However, Lambda is not as technically difficult as Filecoin, and does not burn computing power. Since the launch of the consensus network, the Lambda consensus network has been running stably for 10 months, with 70+ verification nodes, a current block height of 3580000+, 1000+ storage miners, and 22000+ transactions. At present, Lambda's commercial storage function is about to be launched, which can promote the commercial stage of storage.

Overall, although decentralized storage has been delayed many times, it has a foundation for many years of development and the technology is becoming more mature. With the deepening of research and development of projects such as Filecoin and Storj, decentralized storage will usher in an era of large-scale commercial use.

High valuation has become synonymous with Filecoin.

This year, the soaring prices are enough to show how popular Filecoin is. According to the current FIL futures price of $17.1, the valuation of Filecoin, with a constant total of 2 billion, can reach $34.2 billion, ranking fifth in the total market value of digital currencies. For Filecoin, which has not yet landed, can it really deserve such a high valuation?

As a distributed data storage network, Filecoin is both the storage layer and the incentive layer of IPFS, and IPFS is the application of the entire system. Therefore, IPFS directly determines whether Filecoin can have a sufficient business foundation.

Looking at the entire market, many Internet giants have entered the IPFS track. For example, as early as 2019, Microsoft's Azure Marketplace released the IPFS (beta) product, which can create a permission network of IPFS nodes to form a decentralized storage network; in February of this year, Netflix, the world's first video platform, cooperated to develop a set of tools to use IPFS peer-to-peer technical solutions to save its video resources; in March of this year, Google, the world's largest browser, announced that its Google browser has built-in IPFS components; in June of this year, Cangzhou Daily reported that the Cangzhou Huawei Cloud Server Cluster (co-established by the Cangzhou Municipal Government and Huawei Technologies Co., Ltd.) with a total investment of more than 400 million yuan introduced IPFS. In addition to the above-mentioned companies, large companies such as JD.com, Firefox, Opera, and Brave have already made relevant deployments of IPFS.

This is a good thing for Filecoin, but also a test. First of all, compared with mature traditional storage solutions, Filecoin's technology is still relatively "immature", which is one of the reasons why it has been delaying the launch of the mainnet. In this regard, many bears also believe that the availability and economy of Filecoin's so-called distributed storage are not enough to support its current value.

Secondly, characteristics such as "privacy" and "immutability" are double-edged swords. This is both an advantage of decentralized storage projects and the biggest potential factor restricting development. For example, the previously mentioned request to remove child pornography and other content. Although the official said that it will develop a powerful set of tools to help users control the type of data they are willing to store and serve from their machines, it is clear that this does not fundamentally solve the problem. Although we often say "technology is not guilty", this is not a "golden card of immunity from death", and Qvod is a precedent. Therefore, as Filecoin grows, it will have to face policy risks.

Finally, Filecoin is facing competition from traditional giants, such as JD Wireless Treasure. It is understood that JD Wireless Treasure is a router with NAS functions, which has a P2P-based technology monetization system. Users can use idle storage and bandwidth resources to cache some valuable files and data on Wireless Treasure in a distributed manner and make some valuable product monetization. This is somewhat similar to the gameplay of Wanke Cloud launched by Xunlei in 2017, both of which are rewarded by contributing their idle bandwidth and storage resources. However, IPFS is more about solving the problem of content redundancy at the protocol level, while Wanke Cloud is more concerned with file sharing. When JD Wireless Treasure is combined with IPFS technology, the total storage cost is very low, but the data value is very high. For Filecoin, JD, which has its own advantages, is already a potential competitor. And as more and more traditional giants launch such products, how should Filecoin respond?

The start of the calibration period means that we have entered the final stage of the Filecoin mainnet launch, and it also means that the three-year wait from financing to the mainnet launch is about to end. Although the Filecoin mainnet launch window has been postponed again to August 31-September 21, the purpose of the large miner test competition that will be officially launched on August 3 is to focus on testing the network and let miners test their own equipment and mining machines. We can understand that after repeated calibration, Filecoin will soon use the best parts and the best state to let the mainnet ship ride the wind and waves and sail steadily.

However, technology without practical applications and commercial value is ultimately just a castle in the air. After the mainnet is launched, can the highly anticipated Filecoin meet the public's expectations? In the process of leaping from technology to value, how many cold winters will Filecoin experience? We don't know all this.

Perhaps, Filecoin, with its technological content, has indeed made the public and the capital market look up to it, but at the same time, it is also a hotbed for bubbles to brew, and the launch of the mainnet will be the beginning of its "bubble bursting". As for the future value of Filecoin, only time can tell.