Siacoin Review: Beginners guide
Siacoin (SC) The Airbnb of file storage
Industry type: Decentralised storage.
What is Siacoin?
Sia is a decentralised cloud storage platform for users to rent storage space from each other in exchange for Siacoins. Sia uses smart contracts for storage providers to create a publicly auditable agreement with clients until the contract expires. Although the platform itself is decentralised, Sia is backed by Nebulous Incorporated, a for-profit Boston-based software development company.
What gives it value?
- Hosts can rent out unused storage space to clients.
- It is a cheaper option than current centralised solutions.
- Clients pay for a host’s storage with Siacoins, while the host deposits the tokens into the contract as collateral which incentivises them to stay online and complete the contract to receive funds. Siacoin transactions are made between clients and hosts using payment channels. Payment channels process transactions off the blockchain to keep the network exclusively for storage contracts.
- Storage smart contracts are the protocols that hosts and clients use to form an agreement with each other. The storage contract declares the intention of a host to store a file with a certain size and how regularly the host must provide the storage. Once submitted, storage contracts can be modified and updated when needed.
- The network ensures client protection with ‘erasure codes.’ Erasure codes are regeneration codes to protect and recover files in the event that a host goes offline. This is done by splitting the file into pieces in such a way that the entire file can be recovered from any 10/100 pieces. Each piece is encrypted and stored across many hosts and as such, the client has the option of saving time by uploading or downloading their files to and from the 10 closest hosts that contain a piece of the file.
- A reputation system on the network helps to protect clients from risky hosts. To mitigate this, hosts can show goodwill by locking an amount of time-locked Siacoins that they stand to lose if they cheat the client. Through this system, clients will favour hosts with larger amounts of coins locked away.
- Nebulous Incorporated, the for-profit company that owns Sia, profits from the storage system by removing 3.9% of all contracts and distributing the funds to the company’s revenue as well as the initial Sia investors.
- Todd Miltenberger is and American venture capitalist and the founder of Nebulous. Miltenberger also organises the investment banking at the venture capitalist firm at Stifel Nicolaus.
- David Vorick is the co-founder and CEO of Nebulous incorporated. Vorick is a reputed developer and computer scientist who worked on many software developments before joining Nebulous.
- Luke Champine is the co-founder of Nebulous and respected software developer. Champine previously worked at the cloud delivery platform Akamai, and computer software company Kronos Incorporated.
- ClearSHARE, a decentralised storage system has partnered with Sia to build its platform on the Sia storage blockchain.
- First star ventures, a Boston-based firm was one of the first investors to back the Siacoin project.
- Raptor Group Holdings is a private investment company backed by the Family Office of Jim Pallotta and another initial investor of Siacoin.
- Xiaolai Li made a large angel investment contribution to the Siacoin pre-launch. Li is one of China’s biggest crypto investors who made his fortune in the early days from mining and investing in Bitcoin
Siacoin Review: The Good
- It is a revolutionary technology that threatens to disrupt lucrative centralised utilities like Google Drive and Dropbox.
- It is a relatively simple way for crypto enthusiasts to make a passive risk-free income with Siacoin.
- It has a hard working team and devout community behind it.
- It is one of the strongest real-use cases for blockchain technology.
- The network is decentralised which empowers peer-to-peer
Siacoin Review: The Not So Good
- Siacoin is an inflationary currency with an unlimited cap on how many coins can be mined, which may water down prices from an investor’s long-term perspective.
- The process of buying Siacoin and purchasing storage space is not yet user-friendly for people who are not savvy with cryptocurrency.
- For the most part, the Sia roadmap is not followed by the development team as they are busy making whatever developments are needed at any given time rather than sticking to a plan. Since Sia is privately funded it doesn’t need to publicly publish and follow a roadmap to appease investors.
- Although it isn’t given a date, the Siacoin whitepaper does promise plans to implement a Siacoin/Bitcoin 2-way peg which would attach and safeguard Siacoin to the leading cryptocurrency.
The Sia platform provides a revolutionary peer-to-peer decentralised file storage service that could potentially threaten its centralised competition. As it is still a developing platform this could take some time, and inevitably will be determined by a comparative number of consumers switching to its decentralised solution. However, I did take a tour of the Sia Discord forum which gave me an insight into the thriving development team and community that is working hard behind the scenes to make the best technology possible. For a beginner who is wanting to invest in crypto, Sia may not be the best choice due to its inflationary currency, but for anyone who is looking to make a passive cryptocurrency income, it could be a promising place to start.
The current Siacoin price, market cap and charts.
Where to store this crypto:
Online wallet: https://bit.ly/2mViNhS
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