Blockchain Cloud Storage: Filecoin (FIL), Storj (STORJ), Burst (BURST)... oh yeah, & SiaCoin (SC)
which blockchain cloud project will change the world by 2050. Buy them all.

Blockchain Cloud Storage: Filecoin (FIL), Storj (STORJ), Burst (BURST)... oh yeah, & SiaCoin (SC)


Checkout my recent update on Filecoin here: IPFS is the HTTP of the decentralized internet. Filecoin (FIL) & IPFS are complimentary protocols. Now I understand why FIL is mooning

I recently wrote about how I started doom-scrolling airdrop boards as my home GPU mining farm was getting wrecked by high electricity costs back in 2018. Then the 2018 crypto crash sent me away crying for a while. But before I ultimately gave up crypto for a few years to save my marriage, I made one last effort to redeem the failed experiment... I started mining BURST coin. This isn't a story about how I just found $1,000,000 worth of BURST on an old hard drive or something crazy like that. I'm just saying that at the time, I was looking for an energy efficient mining solution. I was getting pummeled by a crippling electricity bill and a tumbling price of Ethereum from $1,000 down to $400. Then Ethereum dropped down to $200 for what seemed like forever in crypto time. I remember when I first became familiar with the idea of Proof-of-Capacity mining. At some point in 2017, I used some mined Ethereum to purchase about $15 worth of STORJ using the exchange feature in Exodus wallet. I was excited about alt coins and I thought if I had a few dollars worth of every alt-coin, I might do pretty well. Later on, as I began to learn more about blockchain, I began to research what STORJ was all about. I remember thinking, "store-jay", that sounds like a decentralized e-commerce platform. I was surprised to learn that it was meant to be pronounced, "storage". But I was also really optimistic about how decentralized cloud storage might transform the internet (also check out my posts on the decentralized search engine, Presearch).

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I'm pretty sure that Storj's Tardigrade service was still in development at that time. Or, perhaps, I didn't have the required hardware or network specifications for PoC mining STORJ. I remember trying and failing. That's when I discovered BURST. I happened to have a ton of old hard drives laying around unused. I eventually formatted over a dozen drives for use with BURST, which was pretty time consuming and sort of technical at the time. I just went and tracked down my old burst address. It looks like I mined ~1,400 BURST between March and July of 2018. I was really excited about Proof-of-Capacity mining at the time. I even thought about buying a handful of 8 TB hard drives to really make a go of it. But ultimately, I needed every last penny I had to keep my electricity turned on at that point. I think I could have wracked up a few thousand BURST since then. Possibly 50,000 or more. I'll never know. I just wish I would have at least kept my BURST miners running... but I think that my wallet started doing something I couldn't understand. Maybe because I had BURST wallets running mining hard drives on a handful of computers all synced to the same wallet. I didn't understand how to configure things correctly and I remember things were a bit less polished than they appear to be now.

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Fast forward to 2021 and Filecoin (FIL) is the leader in the space. I think it makes some sense based on my experience and what I know of Filecoin. They have actually set fairly high minimum hardware and network specifications for Proof-of-Replication (PoR) FIL mining. So the barrier to entry is somewhat higher than previous decentralized storage protocols for mining. It doesn't seem practical to PoR mine Filecoin on a virtual private server unless the earnings are crazy high. I couldn't find a high storage capacity VPS for under a few hundred dollars per month. I can imagine the problems that Storj & Burst may have had with people like me coming onto the network for a short time and then leaving. That means data redundancy becomes a much higher burden when mining server reliability is low. I think Filecoin has positioned themselves to ensure that a decentralized cloud storage network can be fast, reliable, and decentralized. It just requires trimming some of the fat by ensuring a minimum commitment level to be allowed to PoR mine Filecoin. Proof-of-Capacity, as pioneered by BURST coin, represents the first iteration of decentralized cloud storage. Filecoin's Proof-of-Replication, in contrast, is a more sophisticated iteration of decentralized cloud storage which aims to remedy some of the problems with PoC. For a deep dive into this topic, check out Filecoin's paper on Proof-of-Replication. It's super technical so I won't pretend to understand it all. However, Guy from Coin Bureau does a fantastic job of summarizing the specific abuses and vulnerabilities of PoC and the ways that PoR advances the decentralized cloud storage sector. If I had learned the information in this video Coin Bureau posted about Filecoin yesterday, at the time I first bought FIL... I would have bought a ton of FIL at $20. Filecoin also provides another way to earn FIL by running a Filecoin network node (which is different than a FIL PoR miner and does not require huge hard drives). Filecoin also has a vesting period for PoR mining rewards, in which staked FIL are slashed & burnt if the miner fails to provide PoR. This serves to help ensure continuity of data and it also makes FIL a deflationary currency, because those burnt FIL, lost by unreliable miners, are gone forever which reduces the max supply.

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I've been watching the Filecoin price since December 2020. FIL was pretty stable in the low $20 range from December 2020 to February 2021. Then I watched it climb to a new support at $40, then $80, now $130. I bought a handful of FIL at $20 and sold at $50. But I was surprised to see it rocket past that level. Then just today, a friend of mine was asking me about Storj. He was trying to get some because he had just learned about decentralized cloud storage on the blockchain and he relayed to me that the price of STORJ was up several hundred percent in recent days. I was glad to hear this because I'm still sitting on like 40 STORJ or something... not enough to notice a price increase like that. It was just some dust leftover in an old wallet that just went from $30 to $100. But it caught my attention and my friend had some questions that resulted in a larger discussion about decentralized cloud storage.

As the conversation went on, we talked about my experiences with BURST, STORJ, & FIL. We compared and contrasted their relative market caps, max supplies, and prices. Initially, I would have guessed that FIL had a much lower max supply than it does, because it's price has been able to exceed $100 per coin. FIL does have a relatively low circulating supply of 61.37 Mil and the market cap is already huge at $8.08 Bil. I can see the market cap of Filecoin increasing 10-20x in the coming 3-5 years with massive adoption, but I don't know enough about how the remaining 97% of supply is going to be distributed. It seems to be on a 20 or 30 year release schedule so it's actually encouraging because Filecoin appears to be making a long play. I hope a lot of that is designated for mining rewards to node operators running expensive hardware. But until I know more, I'm a little hesitant to place larger buys on FIL because it's in the middle of a new price discovery deep into a raging bull market. So, FIL may be a little overvalued at the moment. Maybe that's just me wishing the price will retreat back to $80 or $40 so that I can get a bigger bag. I'm already starting to dollar cost average back into FIL.  Now that I have a much deeper understanding of the project, I also plan to explore running a FIL node or miner again in the near future, so stay tuned for that.

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Storj has been on the scene for a long time now. It's hard to believe that the market cap is $470 Mil. These last few weeks Storj really took off and I still don't know why. It seems to be the Coinbase bump effect for listing on Coinbase, but there must be more going on as well. I need to test out both sides of the product again. STORJ may have considerably more upper price potential than FIL at this time. STORJ market cap is 1/4 that of FIL and STORJ has a much lower max supply at 425 Mil. Moreover, 143 Mil STORJ (33.8% of STORJ max supply) is already in circulation. I think STORJ has potential for 50-100x growth in the next 3-5 years with massive adoption.

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As my buddy and I talked about Filecoin and Storj, we reviewed their respective market caps, supplies, and prices. He had just bought a fair amount of STORJ on Coinbase and he was asking what I knew about it. In the course of our conversation, I remembered my experience mining BURST coin and I recalled that BURST was the originator of Proof-of-Capacity mining.

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When I pulled up the Coingecko on BURST, I was actually delighted to see that it still only has a market cap of $10.7 Mil. This means that there is still huge upward price potential for BURST if the project can make some breakthroughs that bring new attention, users, and investment. The max supply is relatively high at 2.15 Bil. But the good news is that 98% of BURST is already circulating. So if BURST market cap can ever reach $1 Bil, then the price will 100x. If BURST goes to $10 Bil market cap, that would be 1000x price increase. So the upward price potential for BURST may be 100x-1000x in 3-5 years with mass adoption.

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BURST is still a bit of a long-shot because the project hasn't seen much price action for a while. Nonetheless, there is reason to hope. The Burst Twitter accounts (getBURST, burstflash, BurstAppsTeam) have begun posting about some new developments, including a new mobile wallet for BURST. Disclaimer: I haven't tried it out yet, so if you've used the Phoenix wallet, please let me know what you think of it in the comments. 

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We've taken a quick look at these three players (FIL, STORJ, & BURST) and reviewed a brief history of the decentralized cloud storage sector in the crypto economy. Now I want to return to Filecoin to underscore why it's my favorite of the three (even though I'm not rushing to buy FIL at $130). I'll continue to DCA & long term hold FIL for the next decade, mostly because I'm evaluating Filecoin in the context of its role within IPFS .

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I have only just become aware of this effort to replace HTTP with IPFS to build the decentralized internet. I've heard of MaidSafe and I know Brave Browser & Basic Attention Token (BAT) have been making moves toward a decentralized internet protocol. However, becoming aware of the relationship between Filecoin and IPFS while writing this post, has given me the most hope for the development of a decentralized internet that we can all use.157b988ad8524990ff43bcb2a9fb311d66ca89aa4f7b75ce62696faf2d2b9956.jpgI really like the concept of decentralized cloud storage. It has consumer and enterprise level applications which could swallow up a ton of centralized cloud storage providers' market share as the web transitions to a fully distributed model over the next decade. I've been a believer in the technology for a long time, but it is taking some time to really mature. There are issues with content moderation that still need to be addressed. When PoR mining FIL, how can we ensure that our drives aren't being used to store illicit material? However, it seems like some of the initial decentralized cloud storage 1.0 problems are being addressed with Filecoin. Does that mean that we dump BURST & STORJ and buy FIL? No, not in my strategy. I'm now most bullish on FIL over BURST & STORJ. However, I'm going to build my position slowly. It's crypto, who knows what will happen next? BURST could burn 50% of the supply, stop celebrating having pioneered the old PoC model, and actually roll-out a superior implementation of Proof-of-Replication. In that case, I really want to be holding 100,000 BURST. But I imagine it is more likely that FIL will have a big correction soon and then steadily increase in value to become the premiere decentralized cloud storage protocol on the distributed web.  

I have seen value in this space from the moment I learned of it back in 2017. I can't begin to imagine the impact this technology will have on the blockchain world once projects are able to fully transition to using decentralized storage to serve more powerful decentralized applications. I would ideally like to own some of each of these cryptocurrencies because I am bullish on the whole sector. So here's how I am approaching it today. My first goal is 100,000 BURST, 500 STORJ, & 10 FIL. I want about $1,000 in each of these PoC coins. However, I think the best value at the moment is BURST. I want to prioritize BURST, then STORJ, then FIL. So if I had $1,000 today and $100 per month to invest in this sector, I would start with $600 in BURST, $300 in STORJ, & $100 in FIL. Then I would use my $100 per month to dollar cost average into these three coins at about the same ratio until my first target is reached. Next, I would reanalyze the sector and adjust DCA to reach STORJ & FIL goals. From there, I would pause purchase accumulation and begin exploring Proof-of-Capacity mining again. I helped my friend get 100,000 BURST on Bittrex. He already bought 500 STORJ on Coinbase. Now, we're going to DCA into FIL and hope the price settles back down for a while so we can accumulate a position in FIL. Alright, I hope that's helpful for you guys out there looking into decentralized cloud storage. I will continue to keep a lookout for other decentralized cloud storage projects I'm not yet aware of. I would also love to hear about your favorite blockchain cloud projects in the comments below.

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You can buy STORJ & FIL on Coinbase now. You can also get FIL on Kucoin (a centralized exchange I actually like). I'm not a huge fan of using centralized exchanges to hold cryptocurrency if a better option exists. You can custody your own STORJ on Exodus wallet. But I don't see support on Exodus for BURST or FIL. You can pick-up BURST on Bittrex (another centralized exchange I actually like). I'll be exploring the new Phoenix BURST wallet and I'll also look more into getting myself a non-exchange wallet for FIL. I assume I'll want something I can mine with later on. So stay tuned for updates on FIL wallets, PoR FIL mining, & FIL network nodes. Oh, yeah, and there's SiaCoin too... I forgot about good old SiaCoin.

0a446d0eab182ffc7071bf6d3f656f22d4729a310b59aa50743a48c9b6295217.jpgI haven't used the SiaCoin decentralized cloud storage service yet. I'm pretty sure I did dual-mine some SiaCoin (SC) back when I was GPU-mining Ethereum. But that's about the extent of my knowledge of the project. If you have a decent GPU on your desktop computer, you may even still be able to download Claymore miner and get started dual-mining Ethereum and SiaCoin.

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This project has withstood the test of time so far. I liked that seemingly low circulating supply of 47.33 Mil, until I realized that SC has no maximum supply... like Dogecoin, there's an endless supply of SC. So this information is interesting because SiaCoin actually proposes a unique model in the decentralized cloud storage market. Obviously, the inflationary model does absorb upward price potential, but that hasn't stopped the price of SC from climbing 1,859% in the past 12 months. Though I've not used their cloud storage platform, I do want to have a position in SiaCoin as well. Maybe I'll try to shoot for about 50,000 SC. It looks like I can get SC on Bittrex as well. I will also work SiaCoin into my DCA strategy for monthly buys going forward. I may do a deeper dive into SiaCoin shortly. I'm still most bullish on FIL long term, but I want to scatter-shoot the whole decentralized cloud storage market sector. I'll bring you more updates soon, but in the meantime, feel free to join my DeFi Beginners Guide: Getting Started on Tron Network or you can learn all about how I used Goose Finance to convert $1,000 to $100 in just two short weeks.

 

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-NOVAX

 

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Coinbase (necessary evil for buying crypto with USD)
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Block To The Future
Block To The Future

Cataloging my discoveries from the fringes of the crypto economy, Tracking innovations in multi-chain defi, yield farming, nodes, and staking. Finding deep value in decentralized small caps. Former broker, former miner, forever decentralist and investor


Block To The Future
Block To The Future

Looking for deep value in small cap blockchain projects.

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