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What Is Filecoin? How To Buy, Expectations And Predictions. Everything You Need To Know About FIL

In addition to Bitcoin, you can of course currently find various other types of crypto, such as Filecoin. If you’re thinking about getting into Filecoin, you should definitely read this article. We help you weigh the pros and cons and tell you how the scales tip in favor of your profit.

To help you learn more about Filecoin, read the history, operation, advantages, disadvantages and risks of Filecoin in this article. This way, after reading this article, it is much easier to determine whether Filecoin is a wise investment for you.

What is Filecoin?

Originally, the Filecoin crypto was created thanks to the initiative of Stanford graduate computer scientist Juan Benet. It was a project for the company Protocol Labs.

As the name suggests, the cryptocurrency used by this blockchain is called FIL-coin. In addition to Protocol Labs, the platform has several major investors such as Sequoia Capital, Andreessen Horowitz, Union Square Ventures or the Digital Currency Group.

Filecoin is a system that allows recipients to store data. In 2017, investors placed over $205 million during its ICO , ranking Filecoin crypto among the most profitable blockchains. In 2018, the explosion in data usage led to a shortage of storage volumes. So this has prompted the platform to create room for compensation.

Filecoin also uses a decentralized system that makes it safer to store data. Their ambition is to store the most important information about humanity in the future. See below an introductory film about Filecoin.

How does Filecoin work?

In practice, the Filecoin crypto works on a peer-to-peer basis. In other words, internet users communicate with each other based on the information they have. Practically speaking, Filecoin miners are members of the blockchain and provide space. On the other hand, participants looking for space come to the miners to get the data storage they need.

Users who want to find data stores to store their data will pay a fee to do so. To this end, they will receive offers (auctions) from Filecoin crypto miners, from which they will choose the one that suits them best. Then their data is encrypted, split and distributed across the network spaces before being included on the Blockchain mapping board. In order to get their files back, they only need to show their private key in the end.

Filecoin works with a fast system by relying on the services of miners. In this sense, some of the miners are paid to ensure the dissemination of information about the respective data storage. In the same way they will be responsible for their salvation later on. This approach guarantees a high speed of data rescue. Mainly because it is a decentralized network, the storage remains easily accessible and does not require many protocols for this process.

It is important to note that the Filecoin wallet can be used physically. This is essential for the security of the FIL coin. Just like paper money, cryptocurrencies can be stolen from their owners. To address this, Filecoin preferred to convert the cryptocurrency Filecoin into physical form. Later in this article we will tell you more about storing Filecoin on hardware wallets.

filecoin-work

Special Features of Filecoin

Blockchain has the special property that it can handle online data storage volumes. In that sense, Filecoin specializes in providing space for data over a certain period of time. For the rest, Filecoin is counting on the launch of the Filecoin mainnet, so that the FIL coin can be exchanged on the blockchain network. In order to improve the price of the FIL coin, the platform accordingly organizes the speed of transactions for buying and selling the repositories.

Filecoin relies on a specific system to secure its customers’ information. To do this, there are two processes that work at the same time. Namely the Proof-of-Replication that wants to provide a quick answer to the encryption request of the customers’ data. This process prevents data loss.

The second alternative is Proof-of-Spacetime. This is based on the determination of the storage time. Since data is constantly exchanged, the storage is limited to a certain time. To this end, the customer and the miner make agreements about the storage time of the information concerned. This is mainly to optimize the use of space and predict the market trend accordingly to better inform the customers.

Filecoin is a rapidly developing project. Therefore, the use of this blockchain will not stop anytime soon, especially given the many developments in the industry. There are therefore still many opportunities for crypto traders.

Why should you choose Filecoin?

Filecoin is a Dropbox-style file storage network. But what makes this system so interesting is its decentralization.

The benefits of Filecoin

Instead of entrusting their files to a platform that controls everything, users can choose directly from the offerings of those who have storage space to offer.

The blockchain has a very secure encryption system. In addition, computer folders are requested very quickly and are spread over different locations. The risk of data disclosure is thereby reduced or even eliminated.

If you have a lot of free and useless storage space, why not use it to earn more income? Share your storage space with others who need it. And in return you will receive the FIL coin. This is how Filecoin mining works.

You can also buy Filecoin crypto directly, which we will tell you more about later in this article. This is also the easiest way to get Filecoin if you only want to use it as an investment.

The disadvantages of Filecoin

Despite all these advantages, security and stability do not exist in the world of crypto Filecoin or other cryptocurrencies. Anyone can lose a lot in a short period of time. The rise or fall in the price of any cryptocurrency is unpredictable. At the time of writing, Filecoin’s price stands at $74.42. However, it could be different in a few hours. So it is very volatile.

The blockchain and token system is still far from being understood by everyone. And most people who know about it know only the most popular cryptocurrencies: Bitcoin , Etherum or even Litecoin . The Filecoin crypto is still relatively unknown. This can cause a complication when using it. You can admit it’s hard to offer people something they don’t even know about.

And since we’re talking about the Internet and computers, we can’t rule out the risk of hackers. Even though all sites have an optimal security system, hackers will always find a way. Technology is constantly evolving and opening the door to all sorts of possibilities, good and bad. So you have to take these risks into account when considering an investment.

Solution risks

There is often a solution for every inconvenience. Also for what we just discussed. That’s why we’re going to give you a few tips to help you enjoy the benefits of Filecoin without having to deal with the risks.

Scammers come in many forms, some more interesting than others. So always act with caution. This advice should of course serve you well in everything you do in your life and not just for cryptocurrencies.

You have to pay money to take advantage of the offers of the Filecoin platform. Make sure you’re on the right site (and not a fake one), and check everything in great detail before paying. The same applies if you want to buy Filecoin crypto. Once you have sent your money, it may not be possible to get it back.

If you want to buy, sell or trade Filecoin, it is best to first see which platform offers the best price. Wait for the right moment to make the most profit: buy when the price is low, sell when it rises. For Filecoin or other crypto coins, this is the basic rule.

How can I store Filecoin?

When you want to store Filecoin in a wallet, you have to make sure that you choose a wallet that supports Filecoin. This coin is a somewhat newer and less known currency than, for example, Bitcoin or Ethereum, so it is possible that you will encounter a wallet that does not support this coin.

You can then store Filecoin in both a hot wallet and a hardware wallet . A hot wallet is often linked to the crypto exchange where you buy the Filecoin, although this is not the most secure option. A hot wallet is always linked to the internet, which means that hackers could gain access to it at any time.

If you want to go for the most secure storage option, it is best to choose a hardware wallet. As the name suggests, this is a wallet in the form of a USB stick. You can therefore completely disconnect this wallet from the internet. The moment you have not linked the wallet to a computer, it is impossible for hackers to get into the wallet. Of course you still have to store the wallet in a safe way. The most popular hardware wallets are from Ledger and Trezor.

Where can I buy Filecoin?

There are several ways to get Filecoin. It is best to buy Filecoin from a centralized crypto exchange, such as Binance , Coinbase , Coinmerce or Bitvavo . You probably also know that there are many crypto exchanges. However, it is not wise to just choose a broker. This is partly due to safety and the costs involved. Some exchanges are not safe enough, and others charge sky-high transaction costs.

We recommend that you buy Filecoin from Binance or Bitvavo, because you can buy this cryptocurrency here for the best price and security. These exchanges are among the largest, so they can always offer high liquidity. This ensures that you as a buyer and seller get the best price for your crypto coins.

It is of course also possible to buy Filecoin from a decentralized exchange (DEX) such as Uniswap or Sushiswap . However, that is not recommended if you are still a novice crypto trader. This is because you have to go through quite a few steps before you have actually purchased your coins. The chance that things will go wrong is therefore many times greater than with Binance or Gate.io . 

Is it smart to invest in Filecoin?

Whether it is smart to invest in Filecoin mainly depends on the current price of Filecoin. The moment you think Filecoin is undervalued, and therefore is actually worth more than its actual value, it may be the right time to buy Filecoin. However, it is also possible that the price is much too high. This can be due to a strong bull run or hype about Filecoin. In that case, it is better to wait until the price has dropped so that you can purchase Filecoin for a cheaper price.

To determine whether the right time for purchase has come, you can use a technical analysis . You then calculate by means of the rate whether it is smart to buy Filecoin. It is also possible to perform a fundamental analysis, where you will look at everything about Filecoin. Think of the functions of the project, the team and the market in which the coin is located.

The price of Filecoin

It is possible to view the Filecoin price at any time. In this way you can quickly and easily see whether it is smart to buy or sell Filecoin. The rate shows the value of Filecoin in the form of US dollars. It is also possible to display the price in euros or Bitcoin.

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