The Filecoin economic model was released, and one stone caused a thousand waves. Pre-mortgage, 180-day linear release of miners' block rewards, valid data and other rules have caused many miners to complain. All of a sudden, some miners cried out that there was no hope of getting back their money, some greeted the family members of the official Filecoin team, and some threatened to form a rebellion and fork...

All kinds of dissatisfaction, disappointment, and anger are spreading in the Filecoin mining market. Behind the emotions are interests. After venting your emotions, you may wish to calmly review and reflect on: how to identify future opportunities in the game of Filecoin's mining economy.

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In the latest official Filecoin economic model released by Filecoin, in fact, most of the information has been revealed before, and this version is more official and specific. Without going into details here, a few key points are listed:

• Storage space requires pre-mortgage: miners increase their computing power to produce blocks, and need to pledge a certain amount of FIL in advance (currently about 1 FIL/32G). This means that the initial demand for FIL is tight, and miners invest a lot in obtaining mortgage coins.

• Block rewards need to be locked: miners get block rewards (about 8.9 FIL/block), which are released in 180 antennas, which means that miners need to provide stable operation and maintenance for at least half a year in order to get 100% of the blocks award.

• The computing power of valid data is 10 times that of invalid data: 320G computing power can be obtained by storing 32G data verified by the filecoin network, but miners only have 32G computing power by brushing 32G data by themselves. The proportion of computing power determines the probability of block generation and the profit of block generation.

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Behind all the above mechanisms is that the Filecoin official has used incentives to forcibly change filecoin from short-term mining profit behavior to long-term stable storage services to earn storage income.

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Who will be the winner in the Filecoin game?

In the official economic model white paper, the Filecoin network participants officially described by Filecoin include: developers represented by Protocol Labs, the Filecoin Foundation, miners, users, and investors holding FIL.

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Participant composition of the Filecoin network

The holdings and release mechanism of FIL owners (potential owners) are as follows:

• ICO investors: 300 million, released linearly every day within 12 months after the mainnet launch (private placement), and linearly released every day within 6 months (public placement).

• Protocol Lab: 200 million, released linearly every day for 6 years after the mainnet goes live.

• Filecoin Foundation: 100 million, released linearly every day for 6 years after the mainnet goes live.

• Miners: The total amount is 1.4 billion. After the mainnet goes online, miners invest in mining machines to compete for block mining output, and the rewards for a single block are released linearly in 180 days.

• FIL investors in the secondary market: Exchange traded FIL arbitrage.

• Users: Need to hold FIL to pay for data storage service fees

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Before the mainnet goes live

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Initial stage of mainnet launch (0-6 months later)

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Mid-term of mainnet launch (about 6 months later)

Miners have the need to pay the operation and maintenance fees for arbitrage and return the cost, and will gradually sell FIL to realize it. If the enthusiasm of new miners to participate in mining is not high, and the poor performance of the IPFS network cannot bring large-scale effective data inflow, FIL will be in a state of oversupply, and the price of FIL will continue to maintain a downward trend. Miners have continuous arbitrage needs. At this time, the economic benefits of mining machines affect the trend of FIL prices in the secondary market.

Combining different periods of time, the miner group will always be under multiple pressures such as large capital, profit pressure from mining machine investors, and competition among miners, and they are a relatively weak group in the entire Filecoin interest game.

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Where is the way out for miners?

Based on the previous analysis, the miner group in the Filecoin ecosystem should be the most frustrated and most worthy of sympathy. The huge investment in the early purchase of mining machines, the initial high-priced acquisition of mortgage coins, the continuous investment in the operation and maintenance of mining machines, and the long-term return of capital and cash, etc. It seems that the word "miserable" is not enough to describe it.

So how can miners save themselves?

At present, it seems that there are two options: uprising and rebellion to fork, or lower expectations for storage.

Forking may be able to save itself, but it is more difficult and risky. The voice of forking Filecoin has always existed in the market, but it is extremely difficult to implement. Leaving aside the technical aspect, just to monopolize the computing power and gain more miners' support to choose the chain after the fork requires a strong appeal and influence. At present, the relationship between top miners is more competitive than cooperation, and it is difficult to establish a solid consensus.

In addition, the developers and partners of the Filecoin ecosystem are mainly foreign, and it is difficult for forks to gain the support of the developers of the Filecoin ecosystem. Losing developer support means that it is difficult to expand the ecosystem and gain share from the traditional storage market.

It may be the best solution to reduce income expectations and plan mining from the perspective of storage. Whether it is from the existence value of Filecoin or the official design of the economic model, one thing can be confirmed: mining serves storage.

So how to deploy Filecoin mining from the perspective of storage? Personally, I think you can start from the following aspects:

• Actively develop enterprise data on-chain, obtain more effective data, and improve the efficiency of computing power growth. (Under the same operation and maintenance cost of the mining machine, the computing power obtained by storing valid data is 10 times that of useless data)

• Develop applications around Filecoin&IPFS, and fully tap the value of IPFS storage in privacy protection, built-in CDN and other features.

• Optimize the mining machine operation and maintenance system, reduce costs and increase efficiency, and reduce penalty losses caused by accidents

Practitioners in the circle are used to comparing Filecoin to early BTC mining when marketing, but in fact, there are essential differences between the two. BTC is more of a role in shaping consensus, and does not have much practical value (not to mention it is used for payment, the actual amount is very small, and it is difficult to promote it on a large scale), while Filecoin is also used as a storage service and storage while shaping consensus. A medium that matches the needs has great practical application value.

If the practical value of Filecoin as a storage is excluded, it is only used to shape consensus, then, is there a lack of such a consensus target in the current blockchain industry? How long can such a target last?

The development and growth of the Internet industry has given birth to Amazon Cloud, Alibaba Cloud and other giants worth hundreds of billions of dollars. Comparing the blockchain industry with the early Internet industry, is there a chance for tens of billions of dollars in storage giants to emerge in the decentralized storage field?

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