I’ve subscribed to Coinbase Earn for a while now. The deal is straightforward: you watch videos about up-and-coming cryptocurrencies and you’re rewarded for your time with units of the currency that you’re learning about. It’s a neat way to distribute coins to a wide variety of people and to spread some love in the crypto community.
I’ve watched a fair number of videos after this many months, and the thing that strikes me about so many of these alt-coins is how undifferentiated they are. Compare Coinbase’s description of Stellar Lumens:
Stellar’s cryptocurrency, the Stellar Lumen (XLM), powers the Stellar payment network. Stellar aims to connect banks, payment systems, and individuals quickly and reliably.
…to their description of Ripple:
Built for enterprise use, Ripple (XRP) aims to be a fast, cost-efficient cryptocurrency for cross-border payments.
Or was that Tezos? Or Algorand? who can keep track any more? The differences between some of these projects are so small that they barely register.
Which is why Filecoin is such a surprise. First, it solves a genuine problem—people want low-cost cloud storage—but the way it solves this fits cryptocurrency remarkably well. Providers of cloud storage offer up their available storage space, and you can purchase this using Filecoin tokens. Proof-of-spacetime checks happen every 24 hours to ensure that the storage provider is actually holding the data and keeping it available, and as this happens the network distributes Filecoins to the provider.
This use case fits cryptocurrency really well, far more so that any other that I’ve seen. Storage providers and customers can be somewhat anonymous from one another, a large pool of providers will ensure that competition keeps prices fair, and the distributed nature of cryptocurrency means that you’ll have providers from all over the world.
The crypto community has always had a lot of high falutin’ talk about redefining money and it’s role as a store of value and medium of exchange, but the recent run-up of cryptocurrency prices—in particular Bitcoin—shows us that a big chunk of the market is prioritising get-rich-quick scheming, but with Filecoin there’s a return to genuine honest-to-goodness capitalism with buyers and sellers and value creation and a marketplace.
Technical requirements are fairly high at this point. You’ll need at least 32Gb of memory and 1Tb of fast NVMe storage to participate as a miner, but it’s easy to see where this is headed. Imagine a world where you could slice off 50% of the free space on your hard disk, and have the network manage that space for you. Consumers use the storage you’ve made available to provide redundancy for their data, and you get compensated in crypto tokens for your trouble.