Mon. Jan 3rd, 2022

    We continue to introduce you to various blockchain technologies. This time, a system that claims to be a global repository of information is being reviewed.

    The frustration of Internet users with the usual file sharing system is growing every year. First of all, they are not satisfied with the fact that the system is not decentralized.

    New systems have begun to appear in response to expectations. One of them is the InterPlanetary File System (IPFS) based on decentralized file exchange.

    IPFS is a distributed system for storing and accessing files, websites, applications, and data.

    The Protocol Labs group of authors, led by Juan Benet, put into the basis of the blockchain the idea that the sites created in IPFS can never be closed by anyone and never.

    How IPFS Works

    Each file uploaded to IPFS and its blocks are assigned a unique cryptographic hash identifier (CID). Next, the system itself removes all existing duplicates of information that has already been assigned a CID. At the same time, it is possible to track the history of file versions, since each change is also assigned unique identifiers. Thanks to this, the content remains in constant access, it is not afraid of server failures and bankruptcy of web sites. In addition, such a file storage system guarantees users the authenticity of information.

    Each block consists of two parts: data from the original file, and links to other blocks in this file. The user searches for the necessary information using words that are clear to him, and IPFS transforms them into a search for the nearest blocks and starts downloading parts of the files.

    Where Is IPFS Used?

    IPFS is not the only creation of Protocol Labs. In order to encourage new users to join the protocol, the Filecoin platform was launched, which allows you to rent out free space on your computer’s hard drive. In turn, the use of the IPFS protocol guarantees the safe storage of information on other people’s devices.

    To pay for the rented space, the platform uses its own built-in cryptocurrency — FIL. The greater the demand from the community for free storage and search space in Filecoin, the higher the cost of FIL. 

    In order for miners to be able to provide space on their hard drives, they must provide collateral in the form of a certain number of tokens that they can purchase on cryptocurrency exchanges.

    Such conditions for entering the platform have two main advantages:

    1. Already at the initial stage, there is a sorting of slow or unscrupulous miners.
    2. The risk of a 51% attack is reduced, as it becomes very costly to launch.

    Thanks to these network settings, Filecoin began to quickly gain popularity among users. According to CoinMarketCap, the FIL token has been able to enter the top 30 cryptocurrencies in a short period since its launch: at the moment FIL capitalization is $959,082,303,35.

    IPFS and Filecoin Development Prospects

    The use of IPFS enables users to securely store and use information, which in the future will make it more efficient to analyze large amounts of data and will contribute to progress by increasing the speed of transactions. In addition, the popularity of IPFS will increase due to an increase in the number of users who abandon centralized systems.

    Complementary work with Filecoin will allow users to choose a more convenient work option for them:

    • IPFS will be chosen by miners — those who have the desire and ability to buy equipment to create an increasing amount of free space for storing information.
    • Filecoin — those who want others to take care of the safety of information, and are ready to pay for it.

    Despite the technical complexity, the symbiosis of IPFS and Filecoin is able to become part of the force that will revolutionize the world of data storage and exchange.