Filecoin had an impressive ICO launch in 2017. It actually broke barriers and raised more than $257 million at the time. About five years later, the cryptocurrency is attracting more investors. Of course, the recent attraction is strongly linked to the launch of its much-awaited Testnet and Mainnet products.
Like many other cryptocurrencies, Filecoin had a remarkable 2021. Earlier in the year, the coin saw an incredible rise of over 250%. Many cryptocurrency enthusiasts have started investing heavily. However, it is important that you understand any digital asset properly before investing in it.
So, what is Filecoin? Should you invest in Filecoin (FIL)? And where exactly can you buy Filecoin? Depending on how well you understand the cryptocurrency scene, you may have many other similar questions about Filecoin. Here, we will answer most of the important questions that can help you make an informed decision about investing in the coin or not.
Before we delve fully into the subject matter here, you should know that we will not decide for you or offer direct investment advice. Rather, we will provide every important information you need to make the right decision. It is essential, therefore, that you read every part of this post carefully to understand and make a sound decision.
- What Is Filecoin?
- A Brief History of Filecoin
- What Makes Filecoin Unique?
- More About Filecoin Token (FIL)
- Should You Invest In Filecoin?
- Is Filecoin A Safe Investment?
- Major Reasons to Invest In Filecoin
- Reasons to Reconsider Investing In Filecoin
- Where Can You Buy Filecoin?
- Best Platform to Buy Filecoin
- What Next After Buying Filecoin?
- Key Points to Keep In Mind
- Final Words
What Is Filecoin?
Filecoin is a cryptocurrency project that is fast becoming the standard for information storage. It is an ambitious project that uses blockchain technology to solve some of the biggest problems associated with centralized cloud storage services. The project aims to “store humanity’s most important information.”
Filecoin can also be described simply as a decentralized storage system built on blockchain technology. It reduces the dependency of cloud storage on centralized systems. It works by allowing people to rent out their hard drive storage space for reward. Users from all parts of the world can then buy storage space from the decentralized storage pool.
Filecoin is similar to cloud storage companies in some ways. The major difference between the crypto project and traditional storage companies is decentralization. While the companies hold the power over data and act as gatekeepers, Filecoin gives power back to users, thanks to its decentralized nature. It is also designed to protect the integrity of data and makes it easy to retrieve and difficult to censor.
Filecoin is an open protocol based on a blockchain that records commitments by the network’s participants. The network uses both proof-of-replication and proof-of-spacetime mechanisms.
Like other important cryptocurrency projects, Filecoin has a native currency. Actually, Filecoin can be described as a digital currency that operates on a decentralized network that focuses on information storage. The digital token of the network trades under the ticker symbol FIL. It is a fast-growing digital asset that you can trade or invest in for profit-making.
A Brief History of Filecoin
Filecoin, as a project, started in 2014. In the early days, it was described as an incentive layer for the Interplanetary File System (IPFS), a peer-to-peer storage network created by Juan Benet, an American computer scientist. The IPFS blockchain made Filecoin possible.
Juan Benet studied at Stanford University. He started Protocol Labs in 2014 and started a number of important projects. He attended Y Combinator in the summer of 2014 in a bid to support Filecoin, IPFS, and some other projects.
It took Benet and his team a while to build Filecoin. The cryptocurrency had its initial coin offering (ICO) in 2017, approximately three years after the project started. The Filecoin mainnet was only launched in October 2020.
Filecoin’s ICO was a huge success as the project raised more than $200 million to get things started. The initial price of the coin was $5 per token. Over the years, the network and its native currency have grown significantly. Filecoin (FIL) has recorded more than 14,000% returns since it was launched in 2017.
What Makes Filecoin Unique?
Filecoin is unique because it focuses on an industry that has not been penetrated by blockchain technology. It is the first cryptocurrency project to take on the challenges of data storage, and it handles it the right way.
Filecoin has moved from a promising project to an incredible network that store data in a decentralized manner. Thanks to blockchain technology and the decentralized nature of the network, Filecoin offers several advantages over cloud storage companies like Amazon Web Services and Cloudflare. Filecoin protects the integrity of data’s location and makes it easy and faster to retrieve data. Other benefits include improved efficiency and anti-censorship.
Decentralization improves data storage in many notable ways, and Filecoin has demonstrated that to a global audience. It is available to everyone, irrespective of location. It has the potentials to become the fastest and cheapest means of storing data on the internet world. The native currency is also one of the fastest-growing digital tokens. Obviously, it can be a spectacular investment vehicle.
More About Filecoin Token (FIL)
The Filecoin token (FIL) is the digital asset you will buy to invest in the network and stand a chance of making profits. It is a digital currency you can trade on the cryptocurrency market and also the native currency of the network.
Though Filcoin users can also make money by renting out their storage space, the prominent way to make reasonable money from the network is to buy the Filecoin token. There are five groups of stakeholders on the market, including developers, clients, miners, token holders, and ecosystem partners.
FIL is the governance token of the Filecoin network and also the primary asset users can trade for profits. It powers transactions on the network – users make payments and receive rewards in FIL.
Filecoin is a versatile digital asset that can be traded on cryptocurrency exchanges, brokerages, and other crypto platforms.
At the time of writing this piece, FIL was trading for $28.62 per token. In the previous 24-hours, it recorded a low price of $28.13 and a high of $30.51.
Filecoin’s market capitalization is $4 billion, which makes it the #38th ranked cryptocurrency by market capitalization. There are currently 114,312,707 FIL in circulation.
Should You Invest In Filecoin?
From what we’ve discussed so far, you can tell that Filecoin is a decent network that solves some real-world problems. You can also tell that the native currency (FIL) is a good digital asset. In fact, it is one of the attractive cryptocurrencies right now, and people are investing in it.
So, should you invest in Filecoin (FIL)? Well, you should be confident of the viability of Filecoin and its capacity to yield profits before investing. So far, FIL has performed really well since it was launched some four years ago. You need to be sure that it can perform even better in the future, especially if you are investing for profit (which is what every reasonable online trader does).
There are several important factors you need to consider when deciding whether to invest in Filecoin or not. We will simplify things for you by discussing specific reasons you may want to invest in the coin, as well as reasons you may want to avoid the coin.
Read Also: Is It Worth Investing In Filecoin?
Is Filecoin A Safe Investment?
Before discussing reasons to invest or not to invest in Filecoin, let us consider how safe the system is or how safe your investment will be when you choose FIL as an investment vehicle.
Technically, Filecoin is a secured platform. The network employs a dual consensus mechanism – proof-of-replication and proof-of-spacetime. The network has what is called retrieval miners, which are nodes that are competing to serve clients with data as quickly as possible and get rewarded with FIL. The retrieval miners encourage a network of nodes that want to replicate and preserve files
The Filecoin network also has nodes that are called storage miners, which are in persistent competition for contracts to provide storage for clients for a specific length of time. When a deal is agreed upon, a storage miner keeps the client data in a sector and seals it. It can also mine blocks. Storage miners are rewarded for deals in FIL and they also receive block rewards.
Overall, Filecoin is a safe cryptocurrency network and investing in Filecoin is safe as long as your crypto exchange is regulated. Filecoin has solid technology in the background, and there has never been any major security incident in its ecosystem.
Major Reasons to Invest In Filecoin
Security is just one of several factors to consider before investing in a digital asset. When it comes to cryptocurrencies, you need concrete reasons to believe that a digital asset is viable and will be a good addition to your portfolio. In the case of Filecoin, here are some of the most important reasons to trust your instinct and invest in the coin:
Filecoin brings decentralization to data storage
Data storage is a huge market that is bound to grow even bigger as technology continues to advance. There are currently several companies involved in cloud storage, but Filecoin is the only one built on blockchain.
Many users of Filecoin are individuals who understand the issues with centralized data storage. As more people begin to appreciate the benefits of decentralized data storage and other opportunities offered by Filecoin, the network will grow further and its native currency will gain more value.
Filecoin has the capacity to penetrate any market
Unlike many other cryptocurrencies, Filecoin has what it takes to penetrate any market. Data storage has a huge market and Filecoin is leading the charge, as far as blockchain solution in the industry is concerned.
Already, Filecoin has started making waves in China, one of the countries with strict laws on cryptocurrencies. The more we have needs for data and digital information storage, the bigger Filecoin will likely become.
Filecoin has attracted several users and important organizations
Filecoin offers opportunities to individuals who need to rent storage spaces as well as individuals who want to provide their disc space for rewards. There are already several participants all over the world. Peer-to-peer data storage will become more popular in the future, and Filecoin is already championing it.
Again, Filecoin has attracted investors and partners that will help boost both the capacity of the network and its reputation. The impacts of important individuals and organizations will boost the value of FIL and improve your chances of making profits by trading or HODling.
FIL has performed really well since it was launched
FIL, the native currency of Filecoin, was selling for about $5 just after its successful ICO in 2017. Fast-forward to October 2010 when the Filecoin mainnet was launched, the coin gained significantly. It reached an all-time high of $237.24 on April 1st, 2021. Though it is currently selling for far below that high point, there is a good chance it can still get back up.
Filecoin, VideoCoin, and NFTs
Non-Fungible Tokens are taking center stage in the cryptocurrency universe, and Filecoin is already benefiting from that. Filecoin was adopted as a proof-of-ownership (video file ownership), by VideoCoin, a big blockchain project that is designing a solution that can create, store, and trade video-based NFTs. As NFTS become more mainstream with time, Filecoin will get more demand and gain more value.
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Reasons to Reconsider Investing In Filecoin
With several wonderful reasons to invest in Filecoin, many will not think twice about the opportunity. However, Filecoin is not flawless. That things are going so nice for the network and its token does not mean there’s no chance that things can go south. Actually, there are reasons to think twice about investing in Filecoin, and we will briefly discuss them right here:
Filecoin seeks to reform an advanced industry with many heavyweights
Amazon Web Services, Dropbox, and Cloudfare are some of the giant companies already making waves in the cloud storage industry. Filecoin is a new and small company when compared to these companies. It faces big competition from these companies, and its major weapon is decentralization. Some other crypto projects may enter the market and pose more competition to Filecoin.
Filecoin is a relatively new cryptocurrency
Though its whitepaper was published in 2014, Filecoin was not launched until 2017. The token wasn’t really available until much later. The point is, Filecoin is a relatively new project, and no one can tell with certainty what the future holds for it. Again, there is hardly any historical data to help us understand factors that drive growth in the Filecoin network. It is best to be cautious while investing in new crypto projects.
Filecoin is volatile
Another major reason to think twice before investing in Filecoin is the fact that FIL is volatile. Yes, all cryptocurrencies are volatile, but some are worse than others. FIL has shown signs of extreme volatility, which poses a serious risk to investors. Caution is important when investing in such a volatile token.
Where Can You Buy Filecoin?
The cryptocurrency universe has grown so much that digital currencies are available for trading on many platforms. However, there are three major types of platforms where you can buy crypto tokens safely, including official cryptocurrency exchanges, brokerages, and dedicated applications that are neither exchanges nor brokerages.
So, where exactly can you buy Filecoin? Like other digital tokens, FIL is available across a number of platforms. Many traders choose to buy cryptos through official exchanges. FIL is currently available in many exchanges, including Coinbase, Gemini and Binance. You can also buy FIL through brokerages that offer cryptos, such as Etoro. FIL is also available in apps like BlockFi.
Check Out: 5 Best Places to Buy and Sell Cryptocurrency
Best Platform to Buy Filecoin
Though FIL and other cryptocurrencies are easily available on the Internet, you need to be careful where you buy from. Your choice of platform will determine a lot of things, including the security of your investment and your chances of making profits.
Though official exchanges are the most popular choice for most people, there are reasons you may want to avoid them. Buying and selling may be safe in exchanges like Binance, but there are chances that you can lose your digital assets to hackers. Most of the top exchanges has been hacked in the past, and a little carelessness can cost you your investment.
Cryptocurrency investment platforms and apps are also not the best places to buy cryptos. For a start, many platforms sell assets at prices that are higher than official rates. Also, there are platforms that are run by con artists who are out to scam unsuspecting prospective investors. Buying from such exchanges can make you lose your money and important information to people that can use it to fleece you in the future.
From all indications, buying cryptocurrencies from brokerages can be the safest bet for most people. Brokerages are companies that are dedicated to investments. Some are particularly dedicated to online investing in assets like cryptos, stocks, bonds, EFTs, and other investment vehicles. eToro is one of the best ones for cryptocurrency enthusiasts.
Regardless of your experience level in cryptocurrency trading and investing, Etoro can be the best place to buy FIL for several reasons. If you have used the brokerage in the past, you will know that there are several features that favour investors. It is really easy to use and is regarded as the best social trading platform. It is the number one platform for social trading, which helps newbies get a better grip of the market and avoid losses even when they have limited experience.
eToro – Best Cryptocurrency Platform
eToro have proven themselves trustworthy within the Crypto industry over many years – we recommend you try them out.
Virtual currencies are highly volatile. Your capital is at risk.
What Next After Buying Filecoin?
Buying Filcoin is only the first step towards investing in the digital currency. Depending on your investment strategy, you may have to sell the assets a few hours, days, or weeks after buying. If you are interested in HODLing, then you may have to wait for months or years before selling your Filecoin. So, how do you keep the asset safe?
Cryptocurrencies are primarily stored in digital wallets. Just like a physical wallet, a digital wallet is a safe place that can hold a digital asset for as long as you want. It has the necessary features to keep your assets safe until you sell them or use them for other activities like staking and lending.
Just like other things on the internet space, digital wallets are not made equal. Some are better than others, and you need to find a reliable one that can hold your assets safely. This is another area where choosing a good platform matters. Etoro, for instance, offers users a safe, multi-token digital wallet. You can use the eToro wallet to secure all kinds of cryptocurrencies until the market is favourable to sell or until you decide to use it for other activities like making payments and staking.
Are you planning to invest in Filecoin? It can be a viable investment if you know how to trade. Due to the volatile nature of the token and the fact that it is relatively new, it can be too risky for inexperienced traders. Regardless of your trading experience level, you can make a profit by investing in Filecoin, but you need to be careful. You need to buy from the right source and protect your assets at all times.
Trading cryptocurrencies can be rewarding. However, you need to understand the market and keep improving yourself to succeed in any type of online investing/trading activity. Reading the right articles and taking the right courses can be very helpful.
Key Points to Keep In Mind
We've discussed some of the most important things you need to know about Filecoin. We have explained what the cryptocurrency stands for, the problems it solves, and the condition of its native currency FIL. We have also discussed the viability of FIL as an investment vehicle and how safe it is. Obviously, there is a lot of information here, which is why we need to do a recap.
Here are some of the most important information you need to keep in mind while deciding to either invest or ignore Filecoin (FIL).
- Filecoins is a cryptocurrency platform that caters to the need of individuals who need a decentralized platform for storing data and information.
- Filecoin is the first decentralized storage platform and aims to “store humanity’s most important information.
- Filecoin currently offers lots of benefits over traditional cloud storage platforms like AWS and dropbox – it is fast becoming the choice network for those who want to rent storage space and those who are ready to offer their disc space and earn from it.
- Filecoin is a secured platform for data storage and offers novel mechanisms (proof-of-replication and proof-of-spacetime).
- FIL (the native currency of Filecoin) has performed well since it was launched – it is currently the #26 ranked cryptocurrency by market capitalization and has previously featured among the top ten.
- FIL has shown signs of extreme volatility, which can be a problem, especially for inexperienced traders.
- Filecoin can reach new heights in the future, but it is a relatively new digital currency with no reliable history.
- You can buy Filecoin from several platforms, but Etoro is the best for most investors, especially newbies.
- Etoro offers several features that can help traders/investors of all experience levels to minimize risks and maximize chances of making profits.