When it comes to storing data in a decentralized fashion, many Ethereum projects have turned to the InterPlanetary File System (IPFS) – A peer-to-peer hypermedia protocol designed to make the web faster, safer, and more open.
As many may recall, a project named Filecoin hosted one of the largest blockchain-based crowd sales in history, raising $257M to create an incentive layer on top of IPFS. Here’s a recap of the token distribution from that offering.
“The Filecoin network is being developed by Protocol Labs. Users of the Filecoin network pay miners to store their files (i.e., data) across the network and the miners in turn, must prove (via cryptographic proofs) that they are storing such data in order to receive payment and block rewards. Filecoin believes this decentralized model will reduce storage costs and offer a compelling alternative to existing centralized cloud storage offerings.”
Interestingly enough, the crowd sale was concluded in December of 2017 – leaving many to wonder what’s been going on behind the scenes for the past two years.
This past week, it looks like the public may be able to interact with Filecoin in the near-term as Gemini shared their custody announcement, signalling that users would be able to claim their crowdsale tokens when the network launches in Q3 of 2020.
Let’s take a look at what’s been going on using the most recent Filecoin blog post as our reference.
Our latest blog post highlights progress since Testnet Phase 1 + updated roadmap for Phase 2: https://t.co/nlnnYMZ6cp
— Filecoin (@Filecoin) February 20, 2020
Filecoin Roadmap Updates
From a high level, Filecoin recently completed their Testnet Phase 1 as of this past December – aggregating roughly 3.6PiB+ of proven storage capacity to date.
The project is now gearing up for Testnet Phase 2, including numerous engineering, protocol and ecosystem highlights, all of which can be found here.
We’ve also included a visual display of the roadmap for your convenience.
Perhaps the most important to the Filecoin tokenholders includes:
“The launch of a number of ecosystem initiatives during Testnet Phase 2, including the next phase of our trusted setup ceremony.”
In tandem with the Gemini Custody notion and the recent support by Trust Wallet, it’s clear that strategic rollouts for Filecoin are happening as we speak – signalling that token utility may come sooner than we would have thought.
Why Does This Matter?
As it currently stands, IPFS file storage is purely altruistic. Those who are currently supporting the data are doing it out of the good of their hearts – meaning the total capacity for data which COULD be stored on IPFS is quite limited.
With the introduction of Filecoin, many have theorized that allowing unused hard drive space to be used for IPFS data could increase the capacity for decentralized storage upwards of 100x.
Think about it – If you’re living in a third world country and have plenty of unused hard drive space, why not leverage it as an early adopter for the next generation of data storage?
In the scenario that storage space does become scarce (either due to the rapid adoption of IPFS or the demand for web3 products at large) there’s a significant upside to be gained by those who provide capacity in the protocols infancy.
Tying into the sovereign nature of web3 applications, Filecoin offers a novel solution towards removing storage trust from siloes into the hands of the wider population.
Smart take by @mollywood in @wired on cloud storage: “Given how critical the cloud has become for a huge swath of the tech economy, maybe we should ask ourselves whether this infrastructure should be in the hands of a few trillion-dollar companies” https://t.co/XhnLyrVp2O
— Filecoin (@Filecoin) February 12, 2020
If the system can provide similar (or better) throughput, it’s seemingly a no-brainer that standards like Filecoin could change the way we store data and information on a global scale.
Why DeFi Needs Filecoin
Without speculating too far into the future, all of the information aggregated via DeFi (loans, trade positions, contract interactions, etc.) will likely be stored in a trustless, permissionless fashion.
Using a protocol like Filecoin, DeFi can reach its full potential as a permissionless financial primitive due to the removal of trust from centralized entities for the storage of sensitive user data.
In the meantime, we’ll be keeping a close eye on Filecoin and all future announcements via their official Twitter.
Cooper is the Editor of DeFi Rate and an active contributor to leading DeFi media outlets like The Defiant, DeFi Pulse, and Bankless. He works with early-stage teams through Fire Eyes DAO to incubate governance models and grassroots community development. He is an ambassador to Set Protocol and an author of a weekly publication called Token Tuesdays. To stay up with Cooper, follow him on Twitter.