At 22:43 on October 15th, Filecoin, known as the "Ace Pigeon", was finally launched. The mainnet token Fil was immediately launched on various exchanges and opened for trading, and the spot price of Fil on Huobi soared all the way to $220.
Filecoin won its own highlight moment here, and the last highlight moment was 2017 when it attracted huge financing.
The price of Fil has greatly exceeded the expectations of miners and investors. Countless miners witnessed this moment together that night. While they were happy, they had to face the difficulties brought about by the Filecoin economic model and mortgage mechanism.
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The Dilemma of Filecoin Miners
Various controversies caused by the launch of Filecoin have gradually come to the fore, and the game between the miners and the official Filecoin has become more intense. The core of the game between the two parties lies in the release rules of block rewards in the economic model and the pre-sector mortgage.
The so-called pre-sector mortgage means that Filecoin miners participate in mining and need to prepare a certain amount of FIL for sector mortgage. Currently, it is 0.17Fil/sector (32GB storage space). This means that after investing a huge amount of money to purchase hardware, miners still need to obtain a certain amount of FIL as a mortgage currency in order to increase their computing power and have a chance to obtain block rewards. The miners have invested heavily, embarrassing financial pressure.
If the miners grit their teeth and invest funds to the secondary market to collect Fil as a collateral currency and participate in mining. After accumulating a certain computing power (10T), dig out a block with difficulty and get about 10 Fil. These 10 Fil need to be released linearly according to 180 days. In other words, starting from the block generation, only 1/180 of the block reward can be obtained every day.
This means that the newly produced block rewards are still not enough for the pledge of the sector. To increase the chance of block generation, you must continue to purchase Fil for pledge. In this way, miners fall into a vicious circle and are deeply trapped by the pre-mortgage model.
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Distribution of Filecoin's computing power across the network
The computing power of small and medium-sized miners is low, the probability of producing blocks is lower than the proportion of computing power, the rewards for producing blocks are small, and the demand for mortgage coins is huge.
If miners stop losses in time at this moment, it means that the previous investment will be in vain. There is not only a loss of funds, but also the pressure to protect rights from customers who buy mining machines or computing power.
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The official game between miners and Filecoin
Behind the aforementioned filecoin dilemma is actually the result of an unfavorable game between miners and the Filecoin project party. In an economic model, whoever contributes the most must gain the most.
However, Filecoin's economic model does not seem to be designed this way.
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The price trend of Fil reproduces the scene of IEO in those years
After FIL was listed on the exchange, due to the huge market enthusiasm in the early stage of the project, many investors in the secondary market saw the opportunity to make investment profits. A few minutes before Fil was listed on Huobi, the price rose all the way to $220. Subsequently, Fil continued to flow into the exchange for cash, causing the price ratio to drop all the way to $40 (up to 80%).
Miners, early investors, and the Filecoin Foundation are the main players in the game. Who benefits in this process? Whose interests are harmed?
The ones who make the most profits must be those who hold a part of Fil in their hands. The Fil locked by early investors and project parties of Filecoin is released linearly every day. After the mainnet goes live, an average of 530,000 Fil will be released every day. At the current price of Fil, which is about 40-50 US dollars, investors will make about 100 times the profit. The currency in the hands of the project party can also be said to be 0 cost.
At the same time, a bunch of miners are paying the custody fee, waiting for the mortgage coins to increase their computing power and produce blocks. Faced with the initial high currency price, miners don't have the courage and financial strength to collect coins at a high price?
Now, the fil mortgage coin bought for $50 will be released after the sector life is over in about 1 year and 24 weeks. Who can predict the price of Fil in one year?
Therefore, the result of this game is: some miners turn off most of the machines to reduce the growth rate of computing power, and some miners grit their teeth and collect coins for mortgage. Investors continue to cash out the released Fil and leave the market at a profit.
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Where is the future of Filecoin?
The core of the game is the uneven distribution of benefits, and finding a way out from the core reason is the most efficient. Can the Filecoin project party actively listen to the demands of all parties, adjust the economic model in a timely manner, and maintain the balance of interests of all parties?
It is reported that the proposal to adjust the block reward release rules to protect the interests of miners has been passed. Change the original 100% of the 180-day linear release of block rewards to 25% immediate release, and the remaining 75% will be released in 180-day linear release. At the same time, the number of mortgage coins in a single sector is gradually decreasing.
A change in specification means a reallocation of the cake. The new mechanism can greatly ease the pressure on miners to acquire mortgage coins and reduce the amount of FIL that miners receive in the secondary market. However, in the case of a fixed daily release of FIL, miners' demand for purchasing FIL for collateral weakens, and the price trend of Fil in the secondary market is bound to continue to decline, which also means that investors' profits will gradually decrease.
Investors are bound to have objections, but does their objection matter? From the perspective of the long-term development of filecoin in the future, it is not important.
In the long run, the new adjustment plan can solve the current contradiction, but cannot solve the future dilemma of Filecoin.
At present, the computing power of the entire network is close to 600PB (computing power is storage space), which is mainly some useless data, which cannot bring value to the Filecoin network.
The inflow of real and useful data can bring value inflow, which can inject blood into the Filecoin network.
How to promote more effective data flow to the Filecoin network? How to attract users to adopt Filecoin storage services determines the space and time for Filecoin's ecological development.
And these are inseparable from the development of Filecoin application ecology and the improvement of technical perfection. Promoting these is not only the important task of the Filecoin project party, but also what all miners must promote if they want to recover their initial investment in hardware purchases.
