Comment by rodiger | Hacker News Reader

Comment by rodiger | Hacker News Reader

Stealing this from Reddit as it summarizes my feelings about Filecoin's reward structure being a little ponziesque at current prices:

"The primary demand for Filecoin is from people trying to mine it. It requires that you deposit filecoin for every chunk of storage you want to “seal” for mining. It also takes a long time to seal and you have to get to 10tb or you can’t even mine. So people trying to build filecoin miners are likely the primary source of demand for filecoin. Then as the price goes up more people try to mine, but they also need to buy a ton of filecoin.

People are definitely not spending billions to try and store shit on IPFS. It’s people trying to buy filecoin to mine more filecoin. Sigh."[0]

That being said, the tech is pretty cool. And the funding scheme is no different from most PoS coins out there. Proof of Stake works best when there's already wide distribution of a coin. In the initial stages the game theory is tricky. This is all a long-winded way to say it's overpriced right now but could have a bright future.

[0] https://www.reddit.com/r/CryptoCurrency/comments/mhpaar/file...

And what's worse, the mining process has some rather absurd system requirements: 128+ GB of RAM, 1 TB of SSD cache storage (separate from the data being stored!), and a high-end GPU is "recommended". The sense I get is that it's impossible to casually offer up some spare storage from a typical home system, or even from a NAS -- the system requirements effectively limit mining to people willing to spend a couple thousand dollars on hardware.

https://docs.filecoin.io/mine/hardware-requirements/

That seems crazy, especially considering Sia and others have functioning alternatives with no such insane requirements. Maybe they're trying to corner some certain performance oriented market, but that guarantees nothing about network performance which I suspect will be a much larger impact than any of it.

Yeah seems like a weird combination of both PoS and PoW which gets the best of neither. Would've been cool to see a novel PoW here that actually translates into actual "work" for the network.

or "borrow" the hardware and power from their school/employer either without any authorization or for the ostensible purpose of "testing/burn-in"

This raises a giant red flag for me. Storage is storage. This is not like hash mining, which is based on probabilities. You either have the data or you don't. If you have the data, even partially, this should be useful to the system. I can conceive of no reason why a reasonably designed distributed storage system would have such insane requirements.

Security, mostly - if the proofs fail, it’s not just the data that could be corrupted - bad actors could attack the consensus itself and steal unlimited funds. The params for the proofs could be loosened, at the cost of extra risk of an attack. They’ve gone the safe route and picked challenging parameters that would be uneconomic to brute force attack.

If you take a look at the top storage providers, there's dozens who are providing 10 PB+. These are folks that have invested millions to earn FileCoin.

https://stats.filecoin.io/d/z6FtI92Zz/filecoin-chain-stats?o...

Moreover, it's greatly disingenuous to claim that this system lets casual users let their HD space given the system requirements are so high.

Overall bandwidth in the system is 125TB/week. Filling up the storage provided by "dozens who are providing 10 PB+" would require about 20 years at this rate. And another 20 years to download it back

If you want to use spare space to "mine" crypto, look at Chia from the creator of BitTorrent.

The space isn't used for anything useful like IPFS though.

I wish Wuala was still around, damn Lacie for buying - then removing the most interesting part of project (exchanging local storage for cloud storage)... then killing the entire thing. https://en.wikipedia.org/wiki/Wuala#Trading

Their cryptree [0] design for access control was also pretty stunning. We've adopted and improved it in Peergos.

[0] https://raw.githubusercontent.com/peergos/peergos/master/pap...

Besides the GPU, that's a pretty basic server config. Shouldn't cost more than 200/mo

> And the funding scheme is no different from most PoS coins out there.

"Proof of stake" or "Piece of shit"? Unfortunately it's legitimately hard to tell what each person means with this acronym.

Clearly proof of stake. "Shitcoin" has monopolized the verbiage for, well, pieces of shit in crypto.

Oh, you are correct, thanks.

From here on out, I'm selling NFTs before every solid-waste flush. DM me for deets.

(I'm so glad HN doesn't have DMs. This is my attempt at a "joke" in the spirit of April fools day. Sorry)

Why not both?

Proof of shit coins are much more energy efficient than wasteful proof of work. There's already tons of shit going waste all over the world that could be used to build distributed consensus in a fair and equitable way!

After all, everybody poops.

Is 10TB an arbitrary size or does it fluctuate like the bitcoin difficulty?

If it doesn't change then the whole thing is probably just going to crash eventually.

EDIT: after looking at the mining pdf in the child comment this whole thing looks goofy. idk what to say.

No, you don't need 10TB. But you do need a crazy machine with 128GB+ of RAM.[0]

[0] https://docs.filecoin.io/mine/mining-architectures/#protocol...

That link makes it makes it sounds like you need three such machines, one of which requires 256GiB RAM. To store 10TB, which a commercial NAS could do with acceptable performance with maybe 1 or 2 GiB RAM, tops.

Are they aware that 10TB is about 160$ in Hard drives>?

You can mine under 10TiB. You aren’t eligible for block rewards until you are proving at least 10TiB. Filecoin+ verified data deals count for 10x power. There’s a lot of power on the network, so the frequency of winning blocks at the threshold is fairly infrequent.

This just sounds like a really clever mechanism for solving the cold-start problem for the protocol. You generate a bit of initial demand to pull in some initial supply, which in turn generates its own demand, which pulls in more profit-chasing supply (of storage), which drives down the real price of storage, which is part of the value prop to the non-speculative demand, which is how the crypto asset might maintain its value long-term. Boom, now you’ve got a functional network, a valuable token, and a more efficient market for a raw material of the internet economy.

The word bootstrap comes to mind.

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