What Is Filecoin?
Filecoin is a decentralized, open-source file storage network. It is powered by the InterPlanetary File System (IPFS), which is a peer-to-peer protocol designed to make the web faster, safer, and more equitable.
In other words, Filecoin’s blockchain is pretty unique, just like Catgirl Coin. However, compared to other cryptocurrencies, Filecoin has an incentive layer on top of IPFS, which rewards users for storing and sharing files.
How Does Filecoin Work?
The Filecoin network contains:
- Miners — responsible for storing data and maintaining the blockchain
- Storage providers — individuals or organizations that offer storage space on their computers or servers.
- Clients — users who upload files to the network.
To earn Filecoins, miners must provide storage space and bandwidth to clients. In return, they are rewarded with Filecoins for their contributions.
Storage providers earn File crypto by leasing their storage space to miners. Finally, clients pay Filecoins to miners or storage providers in exchange for storing their data.
The Filecoin network’s native cryptocurrency is called FIL (⨎).
The Mining Process Explained
The Filecoin platform mining process differs from Bitcoin and other cryptocurrency mining. Instead of providing computational power, Filecoin miners contribute storage space to satisfy the demands of users who wish to store data. In other words, a Filecoin miner functions as a “database” in the Filecoin ecosystem.
FIL miners can be divided into three groups (one group of miners is yet to become of service, though):
- Storage providers (storage miners) — these Filecoin miners put away client information. How much they earn is directly proportional to how much storage they create.
- Servers (retrieval miners) — they get hold of Filecoin through the price set for their services. How much they earn depends on the speed and proximity of their service.
- Repair miners — they are yet to be implemented in mining Filecoin, but the role is to intervene in cases when there is an unreliable miner present).
Storage providers or storage miners retain the evidence of their data storage once a contract is established with a client. Anybody can verify the proof and see whether the miner is trustworthy.
On the other hand, retrieval miners or servers provide client data (from clients or storage miners) on demand.
Finally, the Filecoin network uses three versions of consensus for mining:
- Proof-of-Replication (PoRep)
- Proof-of-Spacetime (PoSt)
- Proof-of-storage (PoSt)
Filecoin Mining Requirements
To start mining, you will need the following:
- A computer with a processor that supports virtualization and has more than 8 cores, such as Intel 3rd Gen Xeon Scalable, AMD 3rd Gen EPYC, or IBM Power9 processors. This is necessary in order to run the mining software (Lotus, Slate). The Intel SHA extension would be a good idea too.
- Minimum of 1 TiB NVMe-based disk space for cache storage. We also recommend you get an additional hard drive for the final storage. The more storage space you have, the more Filecoin you can earn. After all, the network parameters are over 100GiB.
- At least 128Gb of RAM (along with 256 GiB of swap).
- A good Internet connection.
- A Filecoin wallet. This is where your Filecoin will be stored. You can create one by using the official Trust Wallet app or an online service like Coinbase.
How to Install a Mining Rig
To install a Filecoin mining rig, first, you need to download mining software. We recommend you go with Lotus. Now set your swap size to 250GB. To do this, go into your BIOS and change the “Advanced Memory Settings.”
After that, save your changes and reboot your computer. The next thing you need to do is mount your SATA drive. You will use this hard drive for Filecoin storage.
- Set a fixed IP address in LAN.
- Change files limit.
- Set up your firewall to allow Filecoin connections.
- Install Nvidia’s graphic card drivers and Lotus updates.
- Create a wallet.
- Start the Lotus storage miner.
- Set Environment Variables.
- Set the Miner configurations.
- Run Lotus-storage-miner. Add new storage.
- Initiate Seal Worker and begin the sealing process.
FIL Rewards Mechanism
Miners earn different forms of compensation for their contributions to the network. There are two main Filecoin mining rewards: storage fees and block rewards.
Storage fees are paid to miners every time a user stores data on the network. The amount of storage fees a miner earns is based on how much storage space they have contributed to the network.
Block rewards are paid to miners when they successfully mine a block. A block is a group of transactions that have been verified and added to the Filecoin blockchain. The amount of a block reward depends on how large the block is.
Where to Buy Filecoin
If you’re interested in buying Filecoins, there are a few different ways you can do it. The easiest way is to buy it from an exchange. Currently, the most popular exchanges that support Filecoin are:
To buy Filecoin from an exchange site, you need to:
- Create an account on the site
- Add a payment method (bank account, debit card)
- Start a trade
- Select Filecoin from the list of assets
- Enter the amount you want to buy
- Tap “Buy”
You can also mine Filecoin yourself. If you do this, you will earn Filecoin as a reward for contributing storage space to the network.
Conclusion
The Filecoin mining process is a little involved but definitely doable if you have a decent computer. Just follow the steps we outlined, and you’ll be on your way to earning some Filecoin rewards.
FAQs
What is needed to mine Filecoin?
You will need a good computer with a strong processor, i.e., more than 8 cores, at least 50 GB of free space, and at least 128Gb of RAM. Next, you’ll need to download Filecoin software for mining (such as Lotus or Slate).
The mining software will use your computer’s CPU or GPU to mine for Filecoin. As long as the mining software is running, you will be able to earn rewards.
Is mining Filecoin profitable?
It can be. However, its profitability will depend on many factors, such as the price of Filecoin (its current price is $7.63), the amount of storage space you have available, and the amount of CPU or GPU power you are willing to use for mining.
Generally, the more storage space you have and the more powerful your computer is, the more profitable mining will be.
How long does it take to mine Filecoin?
It will take between 1 to 5 hours to mine one Filecoin. The speed will depend on the power of your computer and the size of the mining pool you are a part of.
How do I create a Filecoin?
You can create a Filecoin by mining for it. When you mine for Filecoin, you are contributing storage space to the network. In return for your contribution, you will earn Filecoin.
As mentioned before, there are three types of miners: storage, retrieval, and repair miners. Storage ones earn Filecoin by providing storage to the network and storing client information. Conversely, retrieval miners wait for the demand to provide the service.
So, if you want to learn how to mine Filecoin, you first need to decide whether you want to be a storage or a retrieval miner.
