In an arms race, how can miners obtain 4 million Filecoin rewards at low cost?

Source | Moer Finance (www.moercj.com)

Recently, Filecoin officially released the second test reward plan, with an estimated reward amount of 4 million Fil coins. Calculated based on the current futures price of 100 yuan, it is about 400 million yuan. The reward covers miners in six continents (excluding Antarctica).

According to the official documents, the specific reward rules are as follows:

Global Rewards Section

The global reward part is aimed at global miners. When the global network storage capacity reaches the corresponding value, the corresponding Fil coins will be unlocked and given to global miners to share. For example, when the global storage capacity reaches 5PiB, 100K Fil coins, or 100,000, will be released.

This reward is only distributed to the top 100 miners in the world, and miners after the 100th place will not receive any reward.

The proportion of rewards distributed to a single miner: storage capacity of a single miner / cumulative storage capacity of the top 100 miners. For example, if the computing power of a miner is 2P, and the cumulative storage capacity of the top 100 miners in the world is 200P, then this miner will receive 1% of the reward. If the global network storage 200P+ > unlocks the value of 100P, the official will release 1 million rewards, and this miner will receive 100*1%=10,000 rewards.

Note that the prerequisite for global rewards is that the storage capacity of each state in the six continents reaches 1PiB.

Rewards for each continent

In addition to receiving global rewards, miners on the entire network can also receive continental rewards within their continent if they meet certain conditions.

The upper limit of rewards for each state is 500K, which is 500,000 Fil, and the total reward limit for 6 states is 3 million Fil.

When the Asian network storage reaches a certain value, the corresponding Fil coin reward will be unlocked. For example, when the Asian network storage reaches 100TiB, 25K, or 25,000 Fil coins, will be unlocked.

Only the top 50 miners in each continent can receive the corresponding rewards for that continent, while miners beyond the top 50 will not receive any. The reward ratio for a single miner is: the network storage capacity of a single miner/the cumulative network storage capacity of the top 50 miners.

Since most of the global Filecoin is concentrated in China and Asia, we mainly analyze Chinese miners.

There is no doubt that under the pressure of performance, Filecoin Chinese miners will try every means to obtain more rewards, even if the cost is greater than the benefits. If allowed to develop, Chinese miners will inevitably enter a high-intensity arms race. The greater the intensity, the higher the cost of loss, and once it starts, it will be difficult to stop.

In fact, according to the official reward rules, there is an equilibrium strategy, that is, everyone uses just the right storage capacity to unlock the corresponding rewards, and then distributes them to the top 100 in the world and the top 50 in the region according to the corresponding proportions. This can achieve Nash equilibrium, that is, each node can maximize the output-investment ratio. But there is a big premise, that is, all the top miners sit together to reach a consensus to participate in the test network reward plan, but the reality is that the probability of them sitting together is too small, because what they really want is the test results rather than the currency, and then rely on the test results to sell mining products. Therefore, ranking is far more important than the actual rewards, so the test is destined to be a big battle, at least in China and Asia.

Of course, after deciding to compete with other nodes, you have to consider the cost issue. The cost is almost a bottomless pit in terms of investment. The key is whether the second place in the world will admit defeat. If not, it will have to continue. Therefore, the top miners who want to compete for the first place will basically not set a budget and reduce costs as much as possible.

There are two directions to reduce costs. The first is to work hard on global rankings. First, in terms of global rankings, taking Chinese miners as an example, if they want to enter the rankings, the cost must be greater than the income. Some miners have to consider how to enter the rankings at the lowest cost, so they will inevitably form alliances with some leading miners. The leading miners provide technology and other support, and charge a certain fee to amortize the competitive costs. These miners can also enter the rankings at the lowest cost.

The second direction to reduce costs is to work hard on regional rankings. In regions other than Asia, competition should not be fierce or even insufficient. If the nodes are in other continents, it is not difficult to enter the regional rankings and you may even make a profit. It is best to have nodes with preliminary preparations. If not, try to control costs and develop in other regions. There is still a chance; or the head node can directly serve nodes in other regions and collect part of the fees to reduce costs.

Therefore, no matter which ecological niche the miners are in, if they want to gain more in the arms race, they must form alliances, alliances, and alliances again. Even if the top miners do not earn service fees, they can still earn reputation through alliances. Alliances of general miners can save competition costs and also have a good ranking. During the second test reward period, it is time to test your luck, and forming cliques and factions will become the main theme.